NASDAQ'S UP JUST OVER 14%, TORONTO UP JUST OVER 5%. WELCOME BACK TO TRADING DAY. WE KNOW THAT TD STOCK HAS BEEN SUFFERING AS IT DEALS WITH ONGOING COMPLICATIONS FROM THIS ANTI-MONEY LAUNDERING PRIMARILY IN THE UNITED STATES. OUR GUEST SAYS THERE IS A RISK THAT TD FACES A HEADS UP AS MUCH AS 4 BILLION DOLLARS HERE. AND OF COURSE, THERE IS A NEW PROPOSED SHAREHOLDER CLASS ACTION LAWSUIT FROM LAWYERS TEND TO COME OUT FROM THE WOODWORK WHEN STOCKS DROP. OUR GUEST HAS ALL GONE TD AND HE SAYS THESE RISKS ARE A BIG OVERHANG FROM THE BANK. WE'RE DELIGHTED TO WELCOME BACK JON AIKEN, DIRECTOR RESEARCH AT SENIOR ANALYST ON THE CANADIAN FINANCIAL SECTOR. IT'S GREAT TO SEE YOU, NGUYEN TITLE. I THINK THIS IS YOUR IS IT YOUR FIRST IN ORDER ROLL IN ON A NEW JEFFERIES RISES YOUR WITH OUR CASE FOR QUITE A WHILE. JUST. >> TD TELUS. I MEAN, YOU SAID THE DAMAGE HERE COULD BE 4 BILLION DOLLARS US. I KNOW YOU ACKNOWLEDGE THAT IMPOSSIBLE TO BE PRECISE KNOW, EXACTING. RIGHT NOW THE MARKET IS TALKING ABOUT 2 BILLION DOLLARS. AND BASICALLY, THIS IS SIMPLE MATH BASED ON THE 450 MILLION DOLLARS US THAT THEY TOOK WITH ONE REGULATORS PROVISION THEY TOOK LAST QUARTER. THEY'RE STILL DEALING WITH 2 OTHER REGULATORS IN THE DEPARTMENT OF JUSTICE. SO YOU JUST YOU OUT, YOU MULTIPLY THAT BY 4 2 BILLION. THE PROBLEM IS ALL THIS CAME OUT AND WE HAD ACTUALLY A 3RD, A REPORTED INCIDENT WITH AML ISSUES WITH TD IN THE U.S. AND SO EVERY TIME INCIDENT COMES UP LIKE THIS, WE SUSPECT THAT THE, THE FINE GOING TO COME OR MORE INFLATED. >> SO AS A SAFETY CHECK, WE WE RAN THROUGH SOME OF THE NUMBERS AND TOOK A LOOK AT WHAT TD CAN ACTUALLY WITHSTAND BEFORE WE, WE WROTE A CAPITAL TO A CRITICAL LEVEL. AND UNFORTUNATELY ON TV ABOUT A YEAR AGO WAS STANDING HEAD AND SHOULDERS ABOVE THE REST OF THE CANADIAN GROUP IN TERMS EXCESS CAPITAL LEVELS. BUT THEY'VE BEEN AGGRESSIVELY BUYING BACK SHARES AFTER THE AFTER THE FIRST HORIZON ACQUISITION FELL THROUGH. BASICALLY BRING DOWN CAPITAL LEVEL, IMPROVE THEIR PROFITABILITY. BUT NOW THEY'RE AT A LEVEL OF 4 BILLION DOLLARS. US IS WHAT THEY HAVE IS ACCESS THAT'S IF THAT'S WHAT THE FINE IS, THEN, YOU KNOW, BASICALLY THEY'RE RUNNING OUT A LEVEL THAT THE MARKET WILL BE JUST COMFORTABLE WITH NOT HAPPY. HAPPENS IF YOUR EXCESS CAPITAL, THE ROADS HE OUT TO DO IN EQUITY ISSUE OF INTER PRESS PRICE. PRESUMABLY US NOW WHEN WE WHEN WE COUNTED ACCESS, WE'RE STILL TALKING ONE FULL 0.200 BASIS POINTS ABOVE THE REGULATORY MINIMUM BASE, WHICH IS AT 11 AND A HALF PERCENT RIGHT NOW. BUT BASICALLY THE MARKET HAS SHOWN THAT THEY WANT TO BUFFER ABOVE THAT, OBVIOUSLY. AND BASICALLY ONCE WHEN THAT LEVEL, THAT WHEN THAT LEVEL HAS BEEN BREACHED, THEN THERE'S DISCUSSIONS ABOUT WHETHER OR NOT THE BANK WILL HAVE TO RAISE EQUITY. WE DON'T THINK THAT HE WILL EVEN EVEN THERE'S A FINE OF BOTH 4 BILLION DOLLARS US, ONLY BECAUSE THERE'S STILL SOME TIME FOR THEM TO CAPITAL BECAUSE WE DON'T KNOW WHEN THE INVESTIGATION IS GOING AND WE DON'T KNOW WHEN THESE FINDS ARE GOING TO BE IMPOSED. SO TD, I MEAN, FRUSTRATING FOR THEM. I MEAN, PERSONALLY, THEY WEREN'T COMPLACENT ABOUT HEAD OFFICE, BUT THIS STUFF HAPPENED UNDER THEIR WATCH ARE NO ABSOLUTE. BASICALLY TAKE TAKE A LOOK AT WHAT HE'S BEEN SAYING TO THE MARKET. THEY HAVE ACTIVELY BE VERY AGGRESSIVELY TRYING TO CHANGE THEIR POLICIES AND PROCEDURES AS SOON AS THIS IS, CAME TO LIGHT FOR THEM. THE PROBLEM THAT WE HAVE, THOUGH, IS THAT IT'S NOT JUST ONE INCIDENT ISOLATED. LIKE I SAID, IT'S THE 3 NOW. AND I ABSOLUTELY UNDERSTAND TEASE FRUSTRATION. I UNDERSTAND INVESTORS FRUSTRATIONS BECAUSE THIS IS SOMETHING THAT MAY NOT NECESSARILY HAVE BE NEAR THEIR FAULT, BUT WE'RE DEALING WITH THE RAMIFICATIONS OF THIS. AND NOW AS WE SIT HERE TODAY, WE HAVE TO FIGURE OUT, OKAY, WHAT IS THE DAMAGE IN TERMS OF THE FINES IN TERMS OF EVER CONSENT. WE'RE MEETING RESTRICTIONS ON WHAT THEY CAN AND CANNOT DO THAT PLACE. HOW LONG THAT IS GOING TO TAKE WHAT THE COSTS OF THE REMEDIATION EFFORTS ARE GOING TO BE OVER AND ABOVE THE FINES. AND WITH ALL THIS UNCERTAINTY, AS YOU SAID, THE THAT WE JUST VIEW THIS IS AN OVERHANG THAT'S GOING TO BE IN PLACE FOR SOME TIME. >> I KNOW THE DIVIDEND YIELD IS JUST ONE METRIC, BUT IT'S GONE ABOVE THAT WELL ABOVE 5% ON TD RIGHT NOW. FIRST, I MEAN, IS THAT YOU HAVE A WHOLE, BUT COULD COULD THAT BE A BUY SIGNAL FOR SOMEBODY WILLING TO WRITE THIS? DO ABSOLUTELY. IF OR IF WE'RE GOING TO LOOK FAR ENOUGH THAT WE DO THINK THAT THIS IS A DEPRESSED VALUATION FOR TV. >> THE PROBLEM IS TERMS OF WINS, WE'VE GONE BACK AND LOOKED AT ALL OF MONEY LAUNDERING ISSUES IN THE U.S.. WHAT HAS HAPPENED. I THREW BASICALLY THE BEST CASE SCENARIO IS A BIT THREE-YEAR TIMEFRAME WHEN INVESTIGATION. AND SO IF YOU'RE LOOKING 5 YEARS, ABSOLUTELY IF YOU'RE LOOKING FOR A BOUNCE THE NEXT 12 MONTHS, WE'VE, WE ACTUALLY DON'T THINK IT'S GOING TO HAPPEN. >> THINK ABOUT WELLS THAT WAS THAT I LEDGE ABOUT TREATMENT OF CONSUMERS ABOUT HUNG OVER THE BANK FOR NO, ABSOLUTELY. AND THE CONVERSATIONS THAT WE'RE HAVING INVESTORS IS WELL, EVERYTHING IS ON ITS ALL PRICED IN, THIS IS OVER BLANCHE. AND YET WE POINT WELLS FARGO SITUATION TO THEM, THIS THAT'S DIFFERENT. IT, IT IS A VERY DIFFERENT CIRCUMSTANCES. BUT THE END IMPACTING THE REGULATORY OVERSIGHT IS HONESTLY, WE CAN DRAW A LOT. A LOT OF PARALLELS TO. >> YOUR YOUR FAVOURITE STOCKS AND THAT AND THE BANKING SECTOR ARE ROYAL CIBC AND BMO AT ROYAL. WHAT WAS TRACK TO WELL, BASICALLY THE ACQUISITION OF HSBC CANADA IS PROBABLY GOING TO SHOOT THE LIGHTS OUT. AND WE WE RECENTLY UPGRADED WHIRLWIND BECAUSE WE WANTED TO SEE HOW THE CONVERSION WAS, WAS GOING TO HAPPEN. IT'S, IT WAS A VERY AGGRESSIVE, VERY RISKY FROM OPERATIONAL STANDPOINT. BUT FROM OUR CHANNEL CHECKS. WE HAVEN'T HEARD A PEEP IN TERMS OF ANYONE BEING VERY UPSET ABOUT THAT. SO NOW WE TAKE A LOOK AT ROLE BEING THE LARGEST GETTING BIGGER, ALL THE KINDS OF SCALED THEY'RE GOING TO GET OUT OF THAT IN TERMS OF COST SYNERGIES. BUT THE ABILITY TO CROSS-SELL INTO THE FORMER HSBC CANADA CUSTOMERS WE THINK IS ACTUALLY REVENUE UPSIDE AS WELL. THAT'S NOT OUT. WE'VE BEEN PRICED IN THE MARKETPLACE. SO IF YOU'RE LOOKING FOR MOVING THE NEXT 12 MONTHS, WE THINK WORLD'S DEFINITELY PLACE FOR THAT WAS A RISKY THAT JUST MARRYING THE 2 HSBC CANADA ROYALS AND THE CULTURES WOULD BE DIFFERENT WHEN HE JUST B.C. WANTED IN TERMS OF THE AGREEMENT WAS BASICALLY AS SOON AS WAS DONE. THE CUSTOMERS ARE IN YOUR PLATFORM. THERE'S NO TALK, NO TIMELINE IN TERMS OF HAVING THEM MOVE WE'RE SLOWLY. AND KEEP IN MIND ACQUISITION IN CANADA HASN'T HAPPENED. WORLD HAS NEVER DONE THIS. >> AND I SO THIS WAS VERY THEY NORMALLY BE TAKING MONTHS TO TRY TO TRANSITION OVER YOU DO A BATCH CUSTOMERS, MAKE SURE THAT THING WAS FINE. THEY DID EVERYTHING IN 2 DAYS, VERY IMPRESSIVE. YOU KNOW, IT'S PROBABLY ONE OF THOSE THINGS IS A LOT HARDER THAN IT I WAS HAPPY, I DIDN'T HAVE TO DO ANYTHING AT YOUR NET. YOU DO FAVOURS CIBC WANTED, THEY GOT GOING FOR WHEN YOU WHEN YOU LOOK AT THE CURRENT ENVIRONMENT BANKS ARE FACING AS REVENUES ARE VERY CHALLENGES BECAUSE THE ECONOMIC HEADWINDS FACING. SO WHEN WE'RE LOOKING AT WHO'S GOING TO PERFORM ITS THOSE BANKS THAT HAVE THE OPPORTUNITY TO TO CUT COSTS TO GREATER DEGREE. OBVIOUSLY, ROYAL BANK OF MONTREAL WITH THEIR INTEGRATIONS ARE IN PLACE. BUT CIBC ACTUALLY SAW THE WRITING ON THE WALL SOONER THAN THAN THE PEER GROUP. THEY HAD STARTED TO VERY AGGRESSIVELY TO 3 YEARS AGO. START MANAGING THE COST WHERE SHE STARTING TO SEE THE FRUITION OF THAT. AND TAKE A LOOK AT THE FIRST TO PORTERS. THEY'VE REPORTED THIS YEAR, THEY HAVE DONE VERY GOOD JOB IN TERMS OF EFFICIENCY. THE PROBLEM IS THAT THE RELATIVE PERFORMANCE IN REVENUE CHALLENGE ENVIRONMENTS, IT DOESN'T STAND UP TO SAME DEGREE. BUT THE MARKET IS STARTING TO RECOGNIZE THAT WE ACTUALLY DO THINK THE CBC'S RELATIVE VALUATION MULTIPLE SHOULD INCREASE OVER TIME. I'M SORRY, BUDDY GOT ABOUT 15 SECONDS, BUT BMO BE MOST HAD A COUPLE OF DISAPPOINTING QUARTERS. BUT YOU THINK THERE'S PROMISE HERE ON THE