TORONTO -- The Directors of TD Bank today announced an increase in the quarterly common share dividend from $0.34 to $0.38. This increase will bring the indicated annual common share dividend rate to $1.52 per common share.

The Directors also declared a stock dividend of one common share on each of the issued and outstanding common shares of the Bank. The effect of this one-for-one stock dividend is the same as a two-for-one split of the common shares.

The cash dividend is effective prior to the stock dividend.

"TD's Directors view these initiatives as a reflection of their confidence in the Bank's strategy and progress," said A. Charles Baillie, Chairman and Chief Executive Officer. "We expect these actions will be beneficial to our shareholders and for the Bank itself. We also expect this will help ensure that the Bank's stock is more accessible to retail investors."

There are no unfavourable Canadian or U.S. tax consequences and shareholders' equity will not be diluted in any way by the stock dividend. The aggregate cash dividend payable to a shareholder will not be affected.

The increased quarterly dividend and the stock dividend will be payable on and after July 31, 1999 to shareholders of record at the close of business on July 8, 1999. New shares may be traded on a "when issued" basis on North American stock exchanges from July 6, 1999 until the stock dividend payment date and thereafter on a regular settlement basis. Existing shares will continue to trade on a regular settlement basis but commencing July 6, 1999, they will trade without this quarter's cash dividend and their price will reflect the stock dividend.

Questions and Answers

Q: Why is TD proceeding with this one-for-one stock dividend?
A:

• This demonstrates the Board's confidence in TD's progress and strategy.
• It is also an opportunity for TD to ensure that its stock is more accessible to retail investors. As a stock's share price increases, it can render the stock inaccessible to some retail investors. This one-for-one stock dividend is essentially the same as a two-for-one stock split of the common shares.

Q: How will this affect TD's stock price?
A:

• On July 6, 1999, two business days prior to the record date of July 8, 1999, the trading price of TD's common stock is expected to be approximately one-half of the trading price on the previous trading day.

Q: How does the stock dividend work?
A:

• The stock dividend will be paid with the Bank's quarterly cash dividend on July 31, 1999. The stock dividend is one common share for each outstanding common share held.
• This has the same effect as a two-for-one stock split; after the stock dividend is paid, each shareholder will have twice the number of shares as before.

Q: Why not just split the stock?
A:

• This one-for-one stock dividend is essentially the same as a two-for-one stock split of the common shares; it can be implemented more quickly and at lower cost to the Bank and its shareholders. The one-for-one stock dividend has no unfavourable Canadian or U.S. tax consequences for our shareholders.

Q: What are the tax implications?
A:

• Shareholders who are Canadian residents should not include the stock dividend in their income for tax purposes.
• For Canadian capital gains purposes, the number of stock dividend shares received should be added to the shareholders' post-1971 pool of shares. The stock dividend shares have an adjusted cost base of nil, resulting in no addition to the cost base of the post-1971 pool. The stock dividend does not alter the number or adjusted cost base of any pre-1972 pool of shares held, if any, and the valuation day value of these shares remains $5.
• Non-residents of Canada will not be subject to Canadian withholding tax on the stock dividend. Shareholders who are not residents of Canada or the United States should consult their own tax advisors regarding the tax implications of the stock dividend in their own country.
• Shareholders who are residents of the United States will not include the stock dividend in their income for United States federal income tax purposes. Such shareholders will generally be required to allocate the tax basis of the stock with respect to which the stock dividend was distributed proportionately between such stock and the stock dividend based on the total number of shares. If the stock with respect to which stock dividend was distributed was purchased at various times and at different prices, the allocation described in the preceding sentence must be made lot-by-lot. The holding period of the stock received as a dividend will include the period for which the shareholder held the stock with respect to which the stock dividend was distributed.

Q: Who is eligible for the stock and cash dividend?
A:

• The record date for the stock and cash dividend is the close of business on July 8, 1999. Shareholders as of that time will receive this stock and cash dividend based on shares held at that time.

Q: How will shareholders receive the stock and cash dividend?
A:

• The quarterly cash dividend will be paid in the usual manner, according to the past instructions of each shareholder. The cash dividend of $0.38 per share will be paid for the number of shares held on July 8, 1999, the record date. The new shares are not eligible for the cash dividend this quarter. Quarterly dividends payable after July 31, 1999 will reflect the stock dividend so that in the absence of any further change to the dividend rate, the dividend for future quarters will be $0.19 per share.
• Most holders of common shares do not need to take any steps to receive their stock dividend. Share certificates for the new shares will be mailed to registered owners at their registered address.
• The only exception is for holders of certificates dated prior to the Bank's July 28, 1983, 3-for-1 common share split. Because of some uncertainty in current addresses for these shareholders, new certificates will not be mailed to them at this time. They will be requested to contact the Shareholder Relations Department for further advice.

Q: How does this affect trading in TD shares in July?
A:

• For normal settlement transactions, the ex-dividend date is the opening of the stock exchanges on July 6, 1999 (July 2, 1999 on the London Stock Exchange). Trades made before this time will result in changes to the shareholder register by the record date and the shareholder will receive the stock and cash dividend. Purchases on or after the applicable ex-dividend date, which are not settled by the record date, will not result in the changes to the shareholder register by the record date and the shareholder will not receive the stock and cash dividend.
• Commencing July 6, 1999 (July 2, 1999 on the London Stock Exchange), common share purchasers will not be entitled to either the cash or the stock dividend and the trading price of TD's common stock on and after that day will reflect this. The trading price is expected to be approximately one-half of the trading price on the previous trading day (Monday, July 5, 1999 in Canada and Tokyo; Friday July 2, 1999 in the United States and Thursday, July 1, 1999 in London, England).
• Shareholders who wish to sell their common shares between the applicable ex-dividend date and receipt of the stock dividend shares on July 31, 1999 should contact their stock broker for information on selling their stock dividend shares during this period and before receipt of their new shares.

Shareholders who need further information may contact TD's Shareholder Relations Department, at (416) 944-5743 (collect, if necessary).