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Filed by The Toronto-Dominion Bank |
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Pursuant to Rule 425 under the Securities Act of 1933 |
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and deemed filed pursuant to Rule 14a-12 under the |
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Securities Exchange Act of 1934 |
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Subject Company: The South Financial Group, Inc. |
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Commission File No.: 0-15083 |
This filing, which includes a communication sent to employees of TD Bank, Americas Most
Convenient Bank and The Toronto-Dominion Bank on June 21, 2010, may contain forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995 and
comparable safe harbour provisions of applicable Canadian legislation, including, but not limited
to, statements relating to anticipated financial and operating results, the companies plans,
objectives, expectations and intentions, cost savings and other statements, including words such as
anticipate, believe, plan, estimate, expect, intend, will, should, may, and other
similar expressions. Such statements are based upon the current beliefs and expectations of our
management and involve a number of significant risks and uncertainties. Actual results may differ
materially from the results anticipated in these forward-looking statements. The following
factors, among others, could cause or contribute to such material differences: the ability to
obtain the approval of the transaction by The South Financial Group, Inc. shareholders; the ability
to realize the expected synergies resulting from the transaction in the amounts or in the timeframe
anticipated; the ability to integrate The South Financial Group, Inc.s businesses into those of
The Toronto-Dominion Bank in a timely and cost-efficient manner; and the ability to obtain
governmental approvals of the transaction or to satisfy other conditions to the transaction on the
proposed terms and timeframe. Additional factors that could cause The Toronto-Dominion Banks and
The South Financial Group, Inc.s results to differ materially from those described in the
forward-looking statements can be found in the 2009 Annual Report on Form 40-F for The
Toronto-Dominion Bank and the 2009 Annual Report on Form 10-K of The South Financial Group, Inc.
filed with the Securities and Exchange Commission and available at the Securities and Exchange
Commissions Internet site (http://www.sec.gov).
The proposed merger transaction involving The Toronto-Dominion Bank and The South Financial
Group, Inc. will be submitted to The South Financial Group, Inc.s shareholders for their
consideration. The Toronto-Dominion Bank and The South Financial Group, Inc. have filed with the
SEC a Registration Statement on Form F-4 containing a preliminary proxy statement/prospectus and
each of the companies plans to file with the SEC other documents regarding the proposed
transaction. Shareholders are encouraged to read the preliminary proxy statement/prospectus
regarding the proposed transaction and the definitive proxy statement/prospectus when it becomes
available, as well as other documents filed with the SEC because they contain important
information. Shareholders may obtain a free copy of the preliminary proxy statement/prospectus,
and will be able to obtain a free copy of the definitive proxy statement/prospectus when it becomes
available, as well as other filings containing information about The Toronto-Dominion Bank and The
South Financial Group, Inc., without charge, at the SECs Internet site (http://www.sec.gov).
Copies of the definitive proxy statement/prospectus and the filings with the SEC that will be
incorporated by reference in the definitive proxy statement/prospectus can also be obtained, when
available, without charge, by directing a request to TD Bank Financial Group, 66 Wellington Street
West, Toronto, ON M5K 1A2, Attention: Investor Relations, 1-866-756-8936, or to The South Financial
Group, Inc., Investor Relations, 104 South Main Street, Poinsett Plaza, 6th Floor, Greenville,
South Carolina 29601, 1-888-592-3001.
The Toronto-Dominion Bank, The South Financial Group, Inc., their respective directors and
executive officers and other persons may be deemed to be participants in the solicitation of
proxies in respect of the proposed transaction. Information regarding The Toronto-Dominion Banks
directors and executive officers is available in its Annual Report on Form 40-F for the year ended
October 31, 2009, which was filed with the Securities and Exchange Commission on December 03, 2009,
its notice of annual meeting and proxy circular for its 2010 annual meeting, which was filed with
the Securities and Exchange Commission on February 25, 2010, and the above-referenced Registration
Statement on Form F-4, which was filed with the SEC on June 10, 2010. Information regarding The
South Financial Group, Inc.s directors and executive officers is available in The South Financial
Group, Inc.s proxy statement for its 2010 annual meeting, which was filed with the Securities and
Exchange Commission on April 07, 2010. Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect interests, by security holdings or
otherwise, is contained in the above-referenced Registration Statement on Form F-4, which was filed
with the SEC on June 10, 2010, and other relevant
materials to be filed with the SEC when they become available.
THE
FOLLOWING IS A COMMUNICATION SENT TO EMPLOYEES OF TD BANK, AMERICAS MOST CONVENIENT BANK AND THE
TORONTO-DOMINION BANK ON JUNE 21, 2010
Daily News Brief
June 21, 2010
Compiled by Jimmy A. Hernandez, Corporate and Public Affairs
TD BANK NEWS
1. |
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TD Cooks Up Burger Joint Plan for New U.S. Outlets The Globe and Mail |
Bank expansion will turn old fast food operations into new branches.
Toronto-Dominion Bank has a plan to keep costs in check as it expands across the eastern United
States by turning old burger joints and chicken outlets into bank branches. [TD Banks Fred
Gaziamo and Bharat Masrani are quoted.]
2. |
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Bank Bids Heat Up Gulf Coast Business Review (FL) |
In the battle for the assets and deposits of Naples-based Bank of Floridas three failed
subsidiaries last month, federal regulators received a total of 16 bids from five undisclosed
bidders. [TD Bank is mentioned.]
3. |
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Fourth of the TD Bank Dozen Laptops Placed in Brewster Cape Cod Today (MA) |
Fourth laptop will benefit Brewster family with three elementary school-aged children. The Laptops
for KidZ project of the Masonic Angel Foundation has placed the fourth of the dozen IBM ThinkPads
donated by TD Bank. [TD Banks Larry Squire is mentioned.]
4. |
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Good Works: Citizens gives $10,000 to Rutlands Paramount. Montgomery Society Receives TD
Bank Gift Burlington Free Press (VT) |
The Montgomery Historical Society recently received a check from TD Bank for $7,852.51 for its
participation in the banks Affinity Program.
5. |
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Champions Set to Defend at Beach to Beacon New England Runner |
The 2010 TD Bank Beach to Beacon 10K will feature both reigning champions, Kenyans Ed Muge and
Irene Limika, against a strong field of world class athletes, race officials have announced.
6. |
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Banks Luring You Into Signing Back Up For High Overdraft Fees The Consumerist |
Banks are mad they cant just automatically charge you a $35 overdraft anymore if you happen to try
to buy a candy bar without enough cash in your account. Newly enacted
Page 1 of 17
legislation says they have to
get you to opt-in to such overdraft programs. So, what theyre doing is renaming the overdraft
programs something else, making them sound awesome, and then blitzing your mailbox and inbox with
up-sells.
INDUSTRY NEWS
1. |
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The Dollars Strong (But Not the One You Think) CNN Money |
There has been a lot of talk lately about how strong the dollar is. But if youre looking for a
real strong dollar, just gaze north. [TD Bank Financial Group is mentioned.]
2. |
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End of Overdraft Fees a Double-Edged Sword The Washington Post |
Bank of America is still suffering the wrath of Washington resident Philip Becnel. Banks have long
walked a thin line on overdrafts. They are a sore point for many consumers, but the fees generate
billions of dollars of revenue each year. Now the Federal Reserve has stepped in to craft new
regulations aimed at preventing complaints like Becnels.
3. |
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Wells Fargo to End Free-Checking Offers July 1: Wachovia Will Continue its Policy Until
Fall 2011 The Winston-Salem Journal (NC) |
The phasing out of the free checking account is accelerating, with Wells Fargo & Co. leading the
movement within its existing brand network but not yet in the Carolinas.
TD BANK NEWS
1. |
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TD Cooks Up Burger Joint Plan for New U.S. Outlets
By Grant Robertson
June 18, 2010 The Globe and Mail |
Bank expansion will turn old fast food operations into new branches.
Toronto-Dominion Bank has a plan to keep costs in check as it expands across the eastern United
States by turning old burger joints and chicken outlets into bank branches.
Embarking on a major push south of the border, TD told analysts Wednesday it is looking to more
than double U.S. profits to $1.6-billion (U.S.) over the next three years. During that time,
Canadas second-largest bank will also open 200 new U.S. branches.
Rather than build from scratch, though, TD is looking to renovate, since fast food restaurants come
with a few key ingredients the bank finds attractive.
The parking is there, the access is there, [and] most of these fast food restaurants already have
a drive-through, so its a perfect fit for us, said Fred Graziano, head of TDs retail banking
division.
The plan is us thinking a little bit outside the box, he told an investor presentation in New
York.
TD is betting big on the U.S., where it has expanded aggressively in the past several years,
amassing a network of nearly 1,200 branches in 15 states, roughly the same number it has in Canada.
Page 2 of 17
The bank told analysts that it plans to boost profit from its U.S. operations through acquisitions,
new branch expansion and fewer loan losses. Most of its new branches will come in key markets such
as Florida and New England, where TD has a significant presence.
Boosting its U.S. profit to $1.6-billion would be a significant jump from the $781-million profit
the U.S. operations reported on Oct. 31, at the end of the last fiscal year.
However, Bharat Masrani, TDs head of U.S. consumer banking, said the bank expects to benefit from
an improving economy and lower loan losses in the years ahead.
TD expects a $300-million earnings lift in the U.S. over the next three years from fewer loan
losses, as customers are better able to keep up with payments in an improving economy.
We are extremely well-positioned along the Eastern Seaboard, and have a strong platform from which
to accelerate our growth, Mr. Masrani told analysts.
TDs retail footprint covers much of the coast from Maine to Florida. In May, the bank bought South
Financial Group Inc. for about $192-million in cash and stock, giving it branches in Florida and
the Carolinas.
In April, it acquired three Florida banks placed in receivership by U.S. regulators. The purchase
of Riverside National Bank of Florida, First Federal Bank of North Florida and AmericanFirst Bank,
gave TD 69 new U.S. branches, and a platform from which it hopes to build.
Prior to the deals, TD had about 30 locations in Florida, which the bank told analysts is among the
most deposit-rich states in the U.S., and one of the wealthiest. Florida is the latest frontier in
TDs $15-billion string of U.S. acquisitions over the past five years that has seen it expand
branches from Boston to New York.
The struggling banks TD bought in Florida were purchased through deals struck with the U.S. Federal
Deposit Insurance Corp. Under the deal, the bank paid face value for the assets, but the FDIC
agreed to pick up at least half of the losses from future failed loans, if they occur.
Top
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Bank Bids Heat Up
By Jean Gruss
June 18, 2010 Gulf Coast Business Review (FL) |
In the battle for the assets and deposits of Naples-based Bank of Floridas three failed
subsidiaries last month, federal regulators received a total of 16 bids from five undisclosed
bidders.
The environment was more competitive, noted EverBank Chairman and CEO Robert Clements, the
eventual winner.
The bidding for Florida banks has gotten so intense that private-equity financier Wilbur Ross Jr.
told American Banker hes looking to buy bank assets in Michigan instead. In Florida,
Page 3 of 17
the pricing
for a bank, even a failed bank, has gone up enormously, he told the trade publication recently.
It is a very different market from what we encountered a year ago.
Ross spearheaded a group of investors in failed BankUnited in Coral Gables in May 2009. When we
bid for BankUnited one year ago, there were three bidders. Now a typical bank failure can have
dozens of interested parties, says John Kanas, chairman, president and CEO of BankUnited, in
response to emailed questions.
David Call, South Florida president and CEO of Fifth Third Bank, speculated that more investors
might buy struggling Florida banks without assistance from the Federal Deposit Insurance Corp. For
example, in May TD Bank acquired The South Financial Group for 28 cents per share, parent company
of Mercantile Bank in Florida. TD says the unassisted acquisition will be slightly accretive to
earnings.
But theres a potential showstopper lurking offshore: the oil spill.
The challenge with the spill is that if oil washes up on more Florida shores or appears to be
threatening much of the coastline coastal real estate values will likely take another hit. That
makes banks with coastal real estate collateral less valuable.
In addition, bankers are worried about exposure to the hospitality industry because tourists will
likely cancel Florida vacations because of tarred beaches.
For example, a half dozen real estate transactions on Sanibel Island in Lee County have been put on
hold because of the uncertainty over the oil spill, says Kevin Hale, a veteran Florida banker and
executive vice president and director of community banking with Mutual of Omaha Bank.
Mutual of Omaha Bank acquired the assets and deposits of Marco Community Bank from the FDIC in
February and is opening branches in the Tampa Bay region. Weve been very active with residential
lending but were starting to see buyers delay closings or back away, waiting to see what happens
with oil spills, Hale says. As every day passes, it becomes a hotter topic in our state.
Jerry Campbell, chairman, president and CEO of Tampa-based HomeBancorp Inc., calls the spill a
potentially big problem for the industry.
The banks are like a mutual fund of economic activity for our area, because they get direct
impacts and reflect indirect ones, says Campbell, whose young bank recently bought two former
Encore Bank branches in Pinellas County.
The impact could include loss of value for beach front real estate properties, plus negative
impact on local fisherman and other commercial activity on the Gulf, he says. The indirect impact
could include tourism declines, with associated loss of retail and hospitality businesses.
Investors already have started to worry about the impact of the oil spill on banks with a
significant presence in the Florida Panhandle. Bloomberg recently reported that stocks of publicly
traded bank companies such as Regions Financial Corp. and Synovus Financial Corp. have suffered
bigger drops relative to the broad KBW Bank Index.
Page 4 of 17
Foresight Analytics, a California-based research firm, projects another 17 banks in Florida will
close this year. But Matthew Anderson, Foresights managing director, says that list could grow if
the oil spill becomes a major catastrophe.
Potential bidders could be scared away until they have better clarity on where things might end
up, he says.
Questionable value
Estimating the present value of Florida banks was already a difficult task before the oil spill,
but the uncertainty about pollution creates another layer of complexity.
Were still faced with the nagging question of what is the true value of the real estate
portfolio, says Hale. Not only are we concerned about the real estate values, but one of our
primary sources of revenues, tourism and fishing, is in question.
Even before the spill, bankers started to worry that the bidding was getting overheated.
I can tell you from experience that there are great pockets of opportunity in the state, but
things have definitely not come all the way back, says Kanas, who expects another 100 banks in
Florida will either merge or close through this cycle. Florida is at the point in the recovery we
expected it to be when we came here, but a full recovery is still a few years away.
The bigger the bank, the more bids its likely to get, says Brian Davis, the chief accounting
officer for Arkansas-based Home BancShares. His company was one of the bidders for the assets and
deposits of Naples-based Orion Bank and Sarasota-based Century Bank in November, ultimately won by
Louisiana-based IberiaBank. Home BancShares recently acquired the assets and deposits of failed Old
Southern Bank in Orlando and Key West Bank.
Davis says his company scouted the Bank of Florida subsidiaries that failed May 28. We looked at
those, but the bank that got it bid pretty dadgum aggressive, Davis says.
Ultimately, investors arent particularly interested in the assets and deposits of failed
institutions, which explains why the FDIC has subsidized most deals. Rather, theyre strategically
seeking branches in regions where they foresee future growth, says Anderson.
Youre not buying todays conditions, youre thinking about the future, he says. Traditional
growth areas like Florida and Georgia have attracted attention longer term because its a safe
assumption that growth will resume.
Thinning out bidders
Uncertainty over the oil spill may temper the number of bidders and the prices investors are
willing to pay, but it probably wont put a halt to acquisitions and consolidations.
Well continue to see FDIC assisted deals in the state of Florida for the next 12 to 18 months,
Hale says.
Meanwhile, struggling banks may worry that the already bad situation could get worse. A number of
smaller banks are looking for partners and what we have noticed is that the directors and
shareholders have become a little more realistic in their price expectations, Hale says.
Page 5 of 17
The Tampa market is especially important to our future goals, says Kanas. We are currently
evaluating a number of branch locations in the region. BankUnited recently hired Harlan Parrish, a
well-known Fort Myers banker formerly with Colonial Bank and later with BB&T, to lead the banks
retail network.
There is definitely capital on the sidelines, but the terms of the deal have to be right, Kanas
says.
While the oil spill may scare away potential investors, it could bring others back who believe
todays deals are becoming too rich. That could have the reverse effect on some acquirers,
Anderson says.
For some acquirers whose strategy of expanding in Florida remains intact despite the oil-spill
threat, the net effect could mean less competition and better terms from the FDIC.
In fact, like a hurricane, the oil spill could have some positive impact on economies of the Gulf
Coast if oil companies and the government spend billions of dollars on the cleanup. Thats where
it gets harder to sort out the economic impacts, Anderson says.
Top
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Fourth of the TD Bank Dozen Laptops Placed in Brewster
June 18, 2010 Cape Cod Today (MA) |
Fourth laptop will benefit Brewster family with three elementary school-aged children.
The Laptops for KidZ project of the Masonic Angel Foundation has placed the fourth of the dozen IBM
ThinkPads donated by TD Bank. This article is the fourth in an exclusive Cape Cod Today series
that follows each of the TD Bank Dozen laptops.
Christine Sieger at the Nauset Youth Alliance/Brewster After School Child Care (BACC) program is a
very active partner of the Masonic Angel Fund. MAF has served the children of BACC for twelve
years. On Tuesday, June 8th the Laptops for KidZ program delivered a total of five IBM ThinkPads
to the Brewster After School Child Care office at the Stony Brook School. This and future articles
will track the deployment of those machines.
TD Bank Laptop #4 was provided for family with three children of elementary school age. The
children are enrolled in both the after school program as well as BACCs summer programs. This
permits their hard-working single mother to maintain uninterrupted full-time employment. The
laptop will be used by all three children to build their computer skills as well as to complete
academic work that they have been assigned.
The kids teachers loaded the computer with whatever software each child needed to work with to
complete their educational program. This can include basic application software, such as the Open
Office package that LFK pre-installs on all of its computers, or task-specific educational software
designed to build a students skills in a particular area.
LFK volunteer project director Mario Meré remarked, We are happy to see one of our computers
helping out an entire family of children. BACCs hand-in-hand approach with their clients
teachers means that everyone involved in a childs academic success can play a part in making this
computer a most valuable learning tool.
Page 6 of 17
This laptop was placed in Brewster by the LFK volunteer staff on behalf of Universal Masonic Angel
Fund chapter that serves children in Orleans, Brewster and Eastham. MAF co-founder Fellows, LFK
project director Mario Meré, and Universal MAF volunteer Michael Leighton delivered the five
computers to NYA/BACC Executive Director Christine Sieger and bookkeeper Susan ONeill.
Universal Masonic Angel Fund has served Brewsters children since 1998. Universal Lodge of Orleans
established the very first Masonic Angel Fund back in 1998. Appropriately, the very first MAF
benevolence was done at the Stony Brook School in 1998 to provide emergency assistance to a family
that lost everything in a fire. Today there are 142 Masonic Angel Fund chapters in twelve states.
Established in March, Laptops for KidZ (LFK) places laptop computers with local schools to be sent
home with children who would not otherwise have computer access outside school hours. LFK tries to
focus on situations where there is a demonstrated educational need for which the school has a plan
that involves use of a computer to address that need.
Were quite impressed by the care the school professionals take in selecting the best software for
the children to use on these computers. Certainly there are some kids that simply need a laptop
for routine tasks such as web-based learning programs or basic word processing, but were also
seeing many more cases where the school sets the bar higher. The teachers provide specialized
software to help the child address a particular challenge theyre trying to overcome, Fellows
reflected.
TD Banks Larry Squire, who arranged the banks donation, was introduced to the Laptops for KidZ
program by Cape and Islands United Way president Richard Brothers.
As with all activities of the Masonic Angel Foundation, the programs volunteers never know the
identity of a recipient child. All transactions are conducted at arms length with the school
professionals working as a go-between to preserve privacy. LFK does not accept direct requests from
potential recipients. All requests must come through a school or other partner agency. LFK
computers are configured in English and are only available to legal residents of the United States.
The TD Bank laptops are eligible to be placed between Plymouth and Provincetown through local
Masonic Angel Fund chapters.
LFK accepts donations of functional Windows-based notebook computers. Functional means that the
laptop will power up and is accompanied by its proper AC adapter. LFK generally does not accept
donations of desktops or monitors. Donations to the 501(c)(3) Masonic Angel Foundation, Inc. are
tax deductible.
Top
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Good Works: Citizens gives $10,000 to Rutlands Paramount. Montgomery Society Receives TD
Bank Gift |
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June 21, 2010 Burlington Free Press (VT) |
The Montgomery Historical Society recently received a check from TD Bank for $7,852.51 for its
participation in the banks Affinity Program.
TD Banks Affinity Program helps nonprofit organizations raise money by receiving an annual cash
contribution from TD Bank, based upon the average deposit balance held by the organizations
participating members.
Page 7 of 17
The Montgomery Historical Society has 71 participating members/households, and plans to use
the money for repairs and restoration of its principal artifact, a former Episcopal church built in
1835 and for other preservation and outreach activities.
The Montgomery Historical Society was formed in 1974 to save the former St. Bartholomews Church
which had been condemned and was to be torn down. It purchased the landmark for $1 and has been
managing the repairs and restoration ever since, including eight beautiful stained glass windows
and a tower clock. Now on the National Register of Historic Places, the building has been evaluated
and found to need substantial structural attention.
Society Chairman, Scott Perry, credits the generosity of its members and the community. We are
very grateful to our members who have embraced this program and to TD Bank for making the Affinity
Program available. This donation will have a major impact on our work. The Society was the only
organization in Vermont to receive a donation from this program.
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Champions Set to Defend at Beach to Beacon. Top International Field Expected at Prestigious
Cape Elizabeth, Maine Road Race |
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June 17, 2010 New England Runner |
The 2010 TD Bank Beach to Beacon 10K will feature both reigning champions, Kenyans Ed Muge and
Irene Limika, against a strong field of world class athletes, race officials have announced.
The TD Bank Beach to Beacon 10K, set for Saturday, August 7 in Cape Elizabeth, Maine, is again
attracting some of the worlds top elite runners to Maines scenic coastline for the 13th edition
of the race founded by 1984 Olympic champion Joan Benoit Samuelson, a Maine native and running
icon.
Its good to have both Ed Muge and Irene Limika coming back to defend, said Larry Barthlow, the
TD Bank Beach to Beacon 10Ks elite athlete coordinator. Ed will be gunning for his third straight
title, which would tie a mens record, and if Irene thought she had it tough with running legend
Berhane Adere of Ethiopia in the field last year, shes going to find the going even more difficult
this time around. Were going to have really competitive fields in both races.
Last year at TD Bank Beach to Beacon, Limika, 30, ran a personal-best of 32 minutes, 6 seconds to
cruise to victory. Her biggest challenger this year may come from Emily Chebet of Kenya, who just
happens to be Muges wife.
Relative unknown Chebet, 24, made a big splash on the world stage in March with a sprint finish to
win the senior race at the 2010 IAAF World Cross Country Championships in Poland. She followed up
earlier this month by setting a course record 15:12 at the Freihofers Run for Women 5K in Albany,
N.Y.
Also in the field is Edna Kipligat, 30, of Kenya, who finished second behind Chebet at Freihofers
and won the 2010 Los Angeles Marathon in her second marathon ever. Not to be
Page 8 of 17
outdone, Lineth Chepkurui, 22, of Kenya set a world record 38:07 in winning the 2010 Bay to
Breakers 12K.
Wude Ayalew Yimer, 23, of Ethiopia, returns to the TD Bank Beach to Beacon 10K for the first time
since 2007, when she came in as a race favorite but got tangled with another runner early in the
race, never recovered and finished a disappointing fourth. Her career has continued to elevate
since then. She took home the 10,000m bronze medal at the 2009 World Championships in Berlin, and
set a new course record (31:58) to win the 2010 World 10K Run in Bangalore, India, beating the
defending champ in the homestretch.
Barthlow said he expects to add a few Eastern European runners and a few more Americans to go along
with Rebecca Donaghue, 33, one of the top U.S. distance runners.
I like what we have going in the womens race with some of the hottest runners out there entered,
he said. I think there are four or five women with a legitimate shot to win, and you never know
who else might pop in there.
On the mens side, Barthlow is working to secure the entry of Martin Lel of Kenya, who is one of
the worlds top marathoners with three Flora London Marathon and two ING New York City Marathon
titles. Lel, who finished fifth in the marathon at the 2008 Olympics, won the Mardi Gras Half
Marathon earlier this year but pulled out the London Marathon in April due to injury.
Ridouane Harroufi, 29, of Morocco is expected to give Muge a strong challenge after finishing sixth
(28:32) at the 2009 TD Bank Beach to Beacon. Harroufi has already recorded a sub-28 (27:51) in
2010 March, which placed him second at the Cooper River Bridge Run in Charleston, S.C.
The field also includes Simon Bairu, 26, who set the Canadian record at 10,000m (27:53.63) earlier
this year; Andrew Lemoncello, 27, a British Olympian who took eighth in his marathon debut last
April at the London Marathon, the first European to finish and Shadrack Biwott of Kenya, a former
University of Oregon All-American and rising star on the U.S. road race circuit.
Barthlow said he expects to round out the mens field in the coming weeks with two or three more
strong international runners and other top American runners once the USA Outdoor Track & Field
Championships conclude.
The group of 30 or so elite athletes will be joined in Cape Elizabeth by the best in Maine and New
England and thousands of recreational runners. Last year, a record 5,624 runners from 16 countries
and 43 U.S. states finished the winding, ocean-hugging, 6.2-mile course.
The TD Bank Beach to Beacon 10K begins at Crescent Beach along Route 77 in Cape Elizabeth and ends
in Fort Williams Park at Portland Head, the most photographed lighthouse in the world.
Prize money for the winner of the mens and womens races is $10,000. In all, nearly $60,000 in
prize money will be awarded to the top finishers and place winners in the various categories for
men and women. A $2500 bonus also is available for any runner who breaks an Open course record.
The beneficiary of this years race is Junior Achievement of Maine, Inc. (JA), a non-profit
organization providing economic education programs that help inspire Maine children to
Page 9 of 17
develop the skills, attitudes and behaviors of success in a global economy. Offered in more than
100 schools across the state, JA programs reached almost 9,000 Maine students in 2009.
The TD Charitable Foundation, the charitable giving arm of TD Bank, will award a cash donation of
$30,000 to JA of Maine. The organization also will benefit from fundraising activities and
publicity through its association with one of Maines premiere sporting events.
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Banks Luring You Into Signing Back Up For High Overdraft Fees |
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By Ben Popken |
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June 18, 2010 The Consumerist |
Banks are mad they cant just automatically charge you a $35 overdraft anymore if you happen to try
to buy a candy bar without enough cash in your account. Newly enacted legislation says they have to
get you to opt-in to such overdraft programs. So, what theyre doing is renaming the overdraft
programs something else, making them sound awesome, and then blitzing your mailbox and inbox with
up-sells. Some banks are even calling people up!
Debit Card Advance is what TD Bank is calling the favor of charging you $35 for an over-drafted
can of soda.
We offer this service as a convenience, and as a safety net, to you, our valued customer, reads
the letter.
The bank sent out new debit cards to customers and said that if they wanted to keep this service
that they needed to call in or visit a bank.
Respond today! Youll lose this important feature on your personal checking account if we dont
hear from you before August 14, 2010.
For some mysterious reason, these new TD Bank debit cards are also totally flat with no raised
numbers. Maybe now that theyve lost some of their bullshit fee streams they cant afford raised
numbers anymore?
Instead of couching it like some kind of cool exclusive program, Chase has taken an empowered
consumer approach.
YOU DECIDE, yells the starburst. Is Chase Debit Card Overdraft Coverage (sm) right for you? Our
bankers can help you make an informed decision.
The letter and flyer encourage customers to call the bank, visit the bank, or read the banks
website to learn about the coverage program. So that you understand its monumental importance, the
letter makes liberal use of bolding, underlining, and capital letters.
It reeks of desperation.
It seems like they are trying to trick clients into thinking that there is a serious problem
unless they get the chase overdraft protection, writes Consumerist reader Cody after
Page 10 of 17
getting an email from Chase. Just the way they word the email isnt right as they are trying to
up-sell that we need to purchase this protection that will inevitably cause more harm than good.
Commenter evnmorlo says that every time they go to their banks website, they force a pop-up to
try to get you to sign up for the $35 overdraft fee. Annath says that hes seen signs saying Have
YOU opted in yet? As though its something everyone NEEDS to do, he writes.
Helix Queen says that her bank called her up and tried to pitch it as a perk. However, she has a
friend who actually likes overdraft protection. Talking to her recently, Helix Queens friend, got
sooo defensive, even expressing her gratitude to the bank for letting her know about having to
opt-in... She said something like Theyre always looking out for me. She couldnt wait to
opt-in...and seemed pissed at the government for taking automatic ODP away.
They didnt take it away, honey child, they took away being forced to automatically be signed up
for it. If you still want the beatings, call them up and theyll only be too happy to oblige.
Top
INDUSTRY NEWS
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The Dollars Strong (But Not the One You Think) |
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By Paul R. La Monica |
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June 18, 2010 CNN Money |
There has been a lot of talk lately about how strong the dollar is. But if youre looking for a
real strong dollar, just gaze north.
Sure, the greenback has done great against the euro. But thats not saying much. The U.S. dollar is
still a proverbial 97-pound weakling compared to the Canadian dollar.
Canadas dollar, commonly referred to as the loonie since the coin features an image of a loon on
the back, has been trouncing its counterpart below the 49th parallel. Its up 3% against the
greenback so far this year and 10% over the past 12 months.
With that in mind, some experts say that investors looking for safe havens should buy Canadian.
That makes sense. After all, Canadas economy is in healthier shape than the U.S. right now. Its
unemployment rate is 8.1% compared to 9.7% in the U.S. Canadas gross domestic product rose at a
6.1% annualized rate in the first quarter compared to a 3% increase in GDP for the U.S.
Canada is in much better shape than other countries around the world. Its not just a recovery,
but an expansion, said Pierre Lapointe, global macro strategist with Brockhouse Cooper, a
brokerage firm in Montreal.
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Lapointe said that part of that has to do with the booming commodities market. Canada has ample
gold reserves and also exposure to oil in the tar sands in Alberta.
He noted that many of the companies listed on Canadas benchmark TSX index are tied to the gold
mining and oil industries.
With gold at record highs and oil starting to creep back towards $80 a barrel, Canadas stock
market has held up much better than others during the euro-induced volatility of the past few
months.
The TSX is down just 1.7% since the start of May while the S&P 500 has fallen nearly 6%, for
example.
But Canada also avoided many of the nasty real estate problems that dragged the U.S. into
recession.
The five largest Canada banks Royal Bank of Canada (RY), Bank of Nova Scotia (BNS), Toronto
Dominion (TD), Bank of Montreal (BMO) and Canadian Imperial Bank of Commerce (CM) are widely
regarded as being in much better position than the top banks in the U.S..
The recession was milder since Canadas banking system is fairly healthy, said Paul Ashworth,
senior economist with Capital Economics, a research firm based in Toronto. Canada never had a
housing downturn that was anything like what happened in the U.S.
Some Canadian companies have even tried to capitalize on this image of financial strength in their
ad campaigns. Toronto-based insurer Sun Life Financial (SLF), which has a big presence in the U.S.
and even has the naming rights for the Miami stadium where the Dolphins and Marlins play, boasts in
commercials that it didnt take any government bailout money.
Thats all well and good. But will Canada keep attracting strong investor interest or is the fact
that Canada isnt the U.S. already priced into their currency, stocks and bonds?
Ashworth said that the rise in gold, which is partly a fear trade, has certainly helped Canada. So
if gold prices cool, that could hurt the Canadian dollar.
But he said that if gold falls on hopes that the global economy is going to avoid another major
meltdown, the trade-off would probably be higher oil prices. That could offset any weakness in
gold.
The bottom line is that the loonie is still a petro currency, he said.
So as long as the Canadian economy holds up, there is a good chance that Canadian assets could
continue to perform well. After all, Canadas central bank took the first step towards bringing
interest rates back to normal earlier this month.
The Bank of Canada boosted rates by a quarter-of-a-point to 0.5%. That makes Canada the first of
the so-called G-7 group of industrial nations to raise rates since the onset of the global
financial crisis in 2008.
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Stefane Marion, chief economist and strategist with National Bank Financial Group in Montreal,
points out that the Bank of Canada is likely to raise rates again next month. And thats lifting
bond rates in Canada.
The difference between the yield on 2-year Canadian bonds and the 2-year U.S. note is about a full
percentage point. In other words, investors believe theyll be able to get a better rate of return
in Canada because the economic fundamentals look stronger.
Gone are the days when foreign investors thought of North America as only the U.S., Marion said.
People are discriminating between Canada and the U.S. Theres probably limited downside for the
Canadian dollar and other assets unless theres a major global economic relapse.
Reader comment of the week. To quote Hannibal from The A-Team (and did they really need to make a
movie of the TV show?), I love it when a plan comes together. This weeks best reader retort fits
perfectly with the theme of todays column.
I wrote on Monday about how Brazilian oil company Petrobras could benefit from the BP fiasco in the
Gulf of Mexico. Paul Dupuis took issue with that.
Why would you suggest Brazil when there is over a trillion barrels in oil reserves in Alberta???
No drilling in water here and we are already are the largest supplier of oil to the U.S., he
wrote.
Well said.
Top
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End of Overdraft Fees a Double-Edged Sword. Consumer-Friendly Law Takes Effect July 1, but
Expect to Pay New Charges for Other Bank Services |
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By Ylan Q. Mui |
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June 20, 2010 The Washington Post |
Bank of America is still suffering the wrath of Washington resident Philip Becnel.
More than a decade ago, when he was a student at Virginias George Mason University, Becnel
overdrew his Bank of America checking account when he bought a cup of coffee, resulting in a
penalty of about $40.
Unaware that he was out of money, he kept using his debit card and getting whacked with penalties,
racking up hundreds of dollars in overdraft charges.
Becnel paid the fines, closed his account and switched banks. To this day, he refuses to do
business with Bank of America, even though his new bank is farther from home.
That was kind of the final straw for me, said Becnel, now a private investigator. The
compounding of fees, its almost criminal.
Banks have long walked a thin line on overdrafts. They are a sore point for many consumers, but the
fees generate billions of dollars of revenue each year. Now the Federal
Page 13 of 17
Reserve has stepped in to craft new regulations aimed at preventing complaints like Becnels.
Starting July 1, the rules will prohibit banks from automatically charging overdraft fees. Instead,
consumers can decide whether they want to use an overdraft service or would rather simply have
their debit cards declined. In addition, some banks have stopped charging overdraft fees if the
account is a few dollars in the hole eliminating the infamous $40 cup of coffee and are
capping the number of charges each day.
According to market research firm Mintel, about 25 percent of consumers it surveyed this spring
indicated they would enroll in overdraft services. About 15 percent said they did not want to sign
up, and the rest were either unsure or were not aware of the changes.
Banking experts and even industry groups have warned that banks will need to replace the revenue
they have long collected in overdraft fees. That means people might find that the fees have
disappeared, only to resurface elsewhere in the form of a maintenance fee on their checking
accounts, for example.
The whole banking system is in a state of flux, said Brian Riley, research director at
TowerGroup, a market research firm.
Consumers have to really read the fine print on this stuff and not go into the banks for the
reward programs and the free toaster.
The new overdraft rules come as banks grapple with tighter regulations on credit card interest
rates and penalty fees mandated by Congress last year. The financial crisis ignited a populist
movement to strengthen consumer protections from Washington, and Congress continues to debate the
creation of an agency devoted to the issue.
The Fed began drafting its new overdraft regulations last fall as lawmakers prepared bills with
similar restrictions in case the Fed did not act.
Meanwhile, numerous banks braced themselves for what many saw as inevitable. According to a survey
by research firm Moebs Services, nearly 14 percent of 2,000 bank and credit unions reported
eliminating their overdraft programs altogether. Bank of America ended its program in March after
extensive interviews with its customers.
We
heard time and time again, Dont let me spend money that I
dont have, said David Owen,
head of the banks payments business.
Washington resident Charlie Meisch said he didnt even realize he had overdraft service on his
account until his bank, Chevy Chase, informed him of changes in the federal regulations. He said he
has never used overdraft programs and would not sign up for the service. But what would entice him
are services or notices that help customers avoid overdrafts in the first place, such as text
alerts when account balances run low.
Banks will set themselves apart the more they can work with you to avoid this stuff, he said.
Some banks that do not charge overdraft fees are promoting their stance as proof they are more
customer-friendly. ING Direct, which hasnt charged overdraft fees since launching its checking
accounts in 2006, created an overdraft calculator for consumers to see how much they can save with
the online bank.
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The checking account should work for you, not against you, said Todd Sandler, head of product
strategy for ING Direct. We feel like weve taken a much smarter approach in this category.
People can still elect an overdraft line of credit, however. In those cases, ING essentially lends
customers the money they are missing at what Sandler said is a competitive rate, rather than charge
a flat penalty fee. Other banks have been touting the ability to tap into savings accounts or
credit cards when a checking account is overdrawn.
But the Moebs survey also showed that about 11 percent of banks and credit unions actually created
overdraft programs, an acknowledgment that the service is important for some customers.
The Feds rules also attempt to recognize that the overdraft service can be a useful tool: The
rules do not apply to checks or recurring automatic payments. Officials said such payments are
often applied to bills, such as rent or car insurance, and consumers indicated that they would
rather pay an overdraft charge than have them denied. Several banks also said they will continue to
allow overdrafts at ATMs but will notify customers that their balances are insufficient.
What we wanted to do was to give customers lots of choices, said Pete Jones, Mid-Atlantic
regional president for Wachovia, which has kept its overdraft service. I dont think we want to do
away with any opportunity.
Still, Wachovias parent company, Wells Fargo, expects that revenue from overdraft fees will fall
by $500 million this fiscal year. Bank of America has estimated its losses at $160 million a
quarter. Moebs estimates that total bank revenue from overdrafts will drop about $2 billion this
year to $35.2 billion, the first decline in at least a decade.
Industry groups have said banks will hunt for ways to recoup those losses. Banks could decide to
charge customers a fee unless they sign up for multiple accounts, rather than just a checking
account, or fail to maintain a certain balance. They might also charge for certain services, such
as writing multiple checks.
We expect that free checking will go very far away, Riley said.
Top
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Wells Fargo to End Free-Checking Offers July 1: Wachovia Will Continue its Policy Until Fall
2011 |
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By Richard Craver |
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June 19, 2010 The Winston-Salem Journal (NC) |
The phasing out of the free checking account is accelerating, with Wells Fargo & Co. leading the
movement within its existing brand network but not yet in the Carolinas.
Wells Fargo, which took over Wachovia in 2008, said yesterday that it will stop offering free
checking accounts as they currently exist to new customers on July 1. It will continue to honor
existing free-checking accounts of Wells Fargo customers, spokesman John Dunn said.
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Existing Wachovia stores will offer the accounts to new customers until conversion takes place in
their area, Dunn said. Branch, brand and software conversions are scheduled to occur in the
Carolinas in the fall of 2011.
Like existing Wells Fargo customers, existing Wachovia free-checking accounts will continue to be
honored, Dunn said.
Dunn said that after July 1, new Wells Fargo customers will have the ability to have some
checking-account fees waived by agreeing to certain products and requirements, such as automatic
deposits and minimum account balances.
Most banks are exploring new revenue sources as they face additional financial regulations, which,
for example, limit overdraft fees on debit cards.
Bank of America Corp. said this week that it is considering charging some checking customers
additional fees, starting in 2011, as it tries to offset the cost of complying with new financial
rules.
Bank of America officials said they still are testing various pricing models around the country. So
far, they said, they have ruled out charging all checking account customers a blanket fee, and are
opting instead to offer a menu of account options.
The bank could waive fees for customers who: use less expensive self-service options such as online
banking, or ATMs rather than tellers; regularly use debit and credit cards; or agree to do business
with the bank in other ways.
You should expect that customers will have a choice of banking more efficiently, bringing more
relationships to us, or paying a maintenance fee, Neil Cotty, the chief accounting officer of Bank
of America, told Wall Street analysts in April.
Tony Plath, a finance professor at UNC Charlotte, said he thinks that some form of free checking
will exist at most banks and credit unions because of public demand and expectation.
Youll see minimum- balance requirements that pay a very low rate of interest so that lost
customer interest can subsidize the delivery of a free checking account, Plath said. It will
depend on the depth of the relationship the bank maintains with the customer.
Cameron Jordan, a spokeswoman for BB&T, said that the bank constantly reviews its product mix and
makes enhancements from time to time.
Scott Bauer, the chairman and chief executive of Southern Community Financial Corp., said he
believes that the decision
to reduce or end free-checking accounts will be made on a case-by-case basis.
Our feeling is that some of the income loss, such as nonsufficient-fund fees, may be temporary,
Bauer said. We just do not know yet what the real impact will be and will wait on actual results.
Greg McBride, a senior financial analyst at Bankrate.com, said that free checking will certainly
become less prevalent.
Page 16 of 17
However, it probably wont become extinct, with credit unions, community banks and online banks
remaining viable alternatives. Consumers will continue to have some options, but it will entail an
assessment of your financial lifestyle and shopping around to find the best deal for you.
Top
The Daily News Brief is published exclusively for the Employees of TD Bank; please do not
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Page 17 of 17