The Canadian lender will pay more than US$3 billion in financial penalties to U.S. agencies. The Office of the Comptroller of the Currency also announced an asset cap that will prevent its American retail division from adding new loans. (The Logic)

Talking point: A U.S. asset cap will be a significant drag on TD’s earnings at a time when the bank is already struggling to turn around its long-underperforming share price. TD’s U.S. retail banking unit is responsible for about a third of the bank’s total earnings, Gabriel Dechaine, an analyst with National Bank Financial, told the Wall Street Journal. A similar growth cap on Wells Fargo, which came in response to a 2018 scandal in which its bankers opened fake accounts for clients, led to years of cost-cutting and massive spending to improve compliance. TD’s risk management failures are “egregious and unacceptable,” acting comptroller of the currency Michael J. Hsu said in a statement. TD CEO Bharat Masrani announced his retirement last month, saying he takes “full responsibility” for the debacle.