09:11 AM EST, 01/17/2025 (MT Newswires) -- TD Bank Group on Friday said Chief Operating Officer Raymond Chun will be appointed president and chief executive effective Feb. 1 instead of the previously announced date of April 10.

The company said Bharat Masrani, the current CEO, will remain available to TD Bank in an advisory capacity until July 31, and will provide continuity on TD's critical anti-money laundering (AML) remediation effort during the transition.

This comes after TD in October pleaded guilty to conspiracy to commit money laundering, leading to US$3 billion in fines and non-monetary penalties from U.S. regulators and the Department of Justice. As part of the penalties, the U.S. Federal Reserve forced the bank conduct an independent review of its board of directors and management.

TD Bank's board approved amendments to its corporate governance guidelines to reduce the discretionary director term extension from five years to two years after an initial 10-year term. As a result, Amy Brinkley, Colleen Goggins and Karen Maidment will retire from the board at the 2025 annual shareholders' meeting scheduled for April 10.

The company said that Claude Mongeau and Brian Ferguson have elected not to seek an extension under the new policy and will also retire at the shareholders' meeting. Board Chair Alan MacGibbon will step down as chair and retire as a director by Dec. 31.

The company also said Elio Luongo, Nathalie Palladitcheff, Frank Pearn and Paul C. Wirth will stand for election at the TD's upcoming shareholder meeting.

TD Bank has adjusted executive compensation to reflect the seriousness of the U.S. AML failures, the associated costs to the Bank and the limitations imposed on the U.S. retail business. Masrani's 2024 total direct compensation was reduced by 89%, from $13.3 million in 2023 to $1.5 million in 2024. There was also a $1 million reduction made in 2023.

In light of the AML matter and TD's overall financial performance, variable compensation for 2024 was reduced by at least 25% from target for all other members of the senior executive team, the company said in a statement.

U.S.-listed shares of TD were last up $0.40, or 0.7%, at $55.72 in pre-market trading. Shares of the company closed up $0.29 to $79.60 on Thursday on the Toronto Stock Exchange.