C H A I R M A N ' S     R E P O R T

This past year proved excellent for financial markets and for TD Securities. Strong economies and stable inflation created excellent conditions for the financing activities of our clients. The new issue market was almost ideal, with clients finding reliable and sustained demand for debt and equity issues. Secondary market activity was equally strong due to the depth of liquidity, as well as the steady development of innovative products and structures to meet the needs of investors, issuers and borrowers.

These favourable market conditions were present in all the markets where TD Securities operates: Canada, the US, Europe, Asia and Australia. Our own financial performance reflected these favourable markets and our ability to meet the needs of our clients creatively, aggressively and professionally. To put our performance in context, TD Securities - the wholesale operations of the TD Bank Financial Group - ranked third in revenues among the "big five" Canadian bank-owned dealers and second in terms of profitability. Our Return on Equity, one of the most important measures of investment banking success, was a very impressive 19.3% for 1999, exceeding the already strong 16.6% ROE in 1998.

Rapid advances in technology and communications have contributed to this robust business environment. The massive shifts in how our existing and emerging clients do business have, in turn, changed their financing needs. In the year ahead, TD Securities will focus aggressively on technology, with the ultimate goal of emerging as an industry leader in e-commerce transactions and applications for our global client base. With our acknowledged leadership in technology, media and telecommunications, TD Securities is building on a strong platform.

Many of our clients are "new economy" companies involved in exciting new ventures and resulting financial transactions. A number of these deals are highlighted in this Review. We look at how communications clients like GlobeNet and Tritel, for instance, are seizing new opportunities for their businesses.

The highlighted transactions illustrate some of the more significant trends in financing and point to our commitment of bringing integrated financing products, insight, credibility and strong execution to the table. The transactions for software company Open Text, for wireless communications leader Clearnet, and for television network CTV also illustrate the importance we place on innovation, agility and capital in meeting the financing objectives of our clients.

Industry knowledge and capital markets experience are also critical when it comes to advising on an important transaction involving a company like Bell Mobility, or doing a complex financing with a derivative component for a European cable operator such as United Pan-Europe Communications.

The mark of TD Securities' success has always been our clients' success. The result of this approach has not gone unnoticed in the industry. In new debt issues in Canada and Europe, we have achieved top industry rankings. In preferred share financings in Canada, we are the acknowledged market leader. And when it comes to leveraged lending and High Yield in New York, we are recognized as the top Canadian dealer.

In 1999, TD Bank completed its historic integration with CT Financial Services Inc. TD Securities' clients will now have access to the most powerful retail network in Canada for product distribution and market liquidity. As well, TD Canada Trust's retail customer base will have access to the many products that TD Securities structures, such as money market instruments, commercial paper, foreign exchange, debt products, preferred shares and equity issues.

We look forward to serving our clients in the coming year with the same commitment and capability that has driven their success - and ours.

Donald A. Wright
Chairman & Chief Executive Officer

MANAGEMENT TEAM

TD Securities' Management Team provides the strategic leadership that delivers consistent value to our clients by providing them with fully integrated products and services and focusing on meeting their financial needs.

Andrea Rosen Institutional Equities Mark Faircloth Debt Capital Markets - Fixed Income Mark Wheaton Investment Banking - Canada Peter Bethlenfalvy High Yield Martine Irman Foreign Exchange, Funding and Money Market

John MacIntyre Corporate Development Richard McCoy Investment Banking - Canada Michael Mueller Investment Banking Michael MacBain Debt Capital Markets Natalie Townsend Merchant Banking Lance Uggla Debt Capital Markets