Canada's Toronto-Dominion Bank (TD) plans to sell its entire investment in U.S. financial services firm Charles Schwab (SCHW) that’s currently worth $15.36 billion U.S.
TD Bank, as the lender is commonly known, owns 184.7 million shares of Schwab's common stock, and says it plans to offload the entire stake.
Shares of Charles Schwab declined 4% on news of the large equity stake sale. The sale comes after TD previously warned of a challenging 2025.
TD is also in the process of paying hefty fines in the U.S. after being found guilty of money laundering at its American operations.
Last fall, TD became the largest bank in U.S. history to plead guilty to violating a federal law aimed at preventing money laundering and agreed to pay more than $3 billion U.S. in penalties.
TD is Schwab's largest shareholder, holding a 10.1% stake, which it acquired through the financial services firm's $26 billion U.S. purchase of TD Ameritrade back in 2020.
The sale is likely to depress Charles Schwab’s stock price in the near-term, say analysts.
Prior to today (Feb. 10), Charles Schwab’s stock had risen nearly 30% over the past 12 months to trade at $83.18 U.S. per share.
TD’s stock has gained 4% in the last year to trade at $82.81 a share.
