TD Bank has shrunk its U.S. business by $48 billion since it was hit with an asset cap last October, as the Canadian megabank makes room on its balance sheet for growth in more promising lines of business. The Toronto-based TD has completed its planned sell-off of $25 billion worth of securities, and it has run off about half of the roughly $35 billion of U.S. loans it has slated to shed. The efforts have taken the bank’s stateside assets down to $386 billion. TD had previously said that it was aiming to shrink assets by 10%, a benchmark it passed during its third quarter, which ended July 31. The contraction efforts began when American regulators told TD that it would have to limit its stateside size to $434 billion after the bank pleaded guilty to fumbling its anti-money-laundering controls. The bank has been selling or winding down “non-scalable and non-core” U.S. loan portfolios, such as point-of-sale financing, correspondent lending, export and import lending, and a commercial auto dealer portfolio, it said Thursday in a quarterly earnings release. Leo Salom, president and CEO of TD’s unit south of the border, said the bank moved out of areas that weren’t as accretive to its return on equity, or where the bulk of its loans were from standalone relationships. Offloading a chunk of U.S. loans creates space for growth in other businesses, like credit cards, home equity lines of credit, and loans to middle-market companies and small businesses, Salom said. “With this asset reduction, the U.S. retail segment could grow core loans at a rate consistent with our historical performance through the medium term without breaching the asset limitation,” he said on TD’s Thursday earnings call. The bank won’t hit an inflection point for U.S. loan growth for at least another year, as it expects to spend most of 2026 trying “to get to the fighting weight size for the U.S. business,” Salom said. TD’s U.S. balance-sheet restructuring efforts since October have resulted in after-tax losses of $1.4 million. Total losses from the strategy should eventually land around $1.5 billion, the bank said, but the restructuring should also benefit TD’s net interest income and return on equity in the long term. Salom declined to give projections for U.S. return on equity until the bank’s investor day at the end of September. But CEO Raymond Chun pointed to “momentum” in the unit.cTD’s U.S. business logged $695 million in quarterly net income after excluding the balance-sheet restructuring efforts. The results were based primarily on overall operating results, not the benefits of fixing up its securities portfolio, Salom said. John Aiken, an analyst at Jefferies, wrote in a note that TD’s third quarter was “arguably not as impressive as some of its peers,” but the bank has had a strong year-to-date run, and “additional upside is still available.” He added that the bank’s results from the U.S. are encouraging, despite a heavy lift ahead.