TD Bank Group (TD.TO) has appointed Ray Chun as the new head of its Canadian personal banking business, following the unexpected departure of Michael Rhodes, who had been seen as a potential CEO candidate for the bank.
Rhodes, a veteran of the industry, has taken on the role of CEO at Discover Financial Services (DFS.N), replacing interim CEO John Owen, who stepped in after Roger Hochschild’s departure in August.
Rhodes had spent 12 years at TD and was considered a possible successor to current CEO Bharat Masrani, who has been in the top position for nearly a decade.
This departure surprised many in the investment community who believed Rhodes was destined for bigger roles within the bank.
Ray Chun, an insider who has been with TD since 1992, is now tasked with leading TD’s largest division in terms of revenue and net income, serving approximately 13 million customers.
He assumes this role at a time when higher interest rates have led to a slowdown in credit growth, and TD, like other financial institutions, is preparing for an increase in bad debts.
Previously, Chun oversaw the bank’s wealth management and insurance unit, which will now be led by Tim Wiggan, who joined TD in 2000 through the acquisition of Newcrest Capital and later moved to TD Securities in 2017.
Bharat Masrani, TD’s CEO, expressed confidence in Chun’s abilities, highlighting his deep market knowledge and unwavering customer focus.
The appointment comes as TD makes changes in its global financial institutions investment banking team, with new co-leads and six new bankers joining the team.
TD has experienced a turbulent year, canceling its proposed $13.4 billion takeover of U.S.-based First Horizon in May and revealing a U.S. Justice Department investigation into its anti-money laundering practices.
To cope with the challenges and slowdown, TD recently announced plans to reduce its workforce by approximately 3%, cutting around 3,000 jobs, the most significant workforce reduction among Canada’s top six banks this year.
TD has shifted its focus to organic growth in its U.S. business, opening several new offices.
However, the bank missed fourth-quarter profit estimates as it set aside more funds than expected to cover potential loan losses.
TD’s stock has faced challenges this year, declining by 6.7%, in contrast to a 4.8% increase in the benchmark Canadian share index.