Short sellers have increased their bets against Toronto-Dominion Bank (TD).
Bearish bets of $3.7B have made the Canadian institution the biggest short in the global banking industry.
- Bets
against TD have surpassed the value of shorts made against larger
global institutions, including Bank of America Corp. and France's BNP
Paribas.
- TD holds a 10% stake in Charles Schwab Corp., a Texas-based financial company that saw its market capitalization plunge by $47B in March.
- The Canadian firm plans to renegotiate or walk away
from a $13.4B deal to buy Tennessee-based regional bank First Horizon
Corp., which saw its value drop to almost 40% below what TD agreed to
pay.
- Investors are not only concerned about TD's exposure to
the turbulent U.S. financial market but also about its vulnerability
to Canada's housing slowdown.
- “TD sits uniquely in the middle of two broad headwinds,” said Daneshvar Rohinton, a portfolio manager at Industrial Alliance.
