UPDATE 1-Canada's TD Bank sets aside $450 mln for US anti-money laundering probe fine

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April 30 (Reuters) - Canada's TD Bank said on Tuesday it had taken an initial provision of $450 million in relation to ongoing discussions with a U.S. regulator over an anti-money laundering probe and any penalties it might be slapped with.

The lender

disclosed

last year that it was cooperating with authorities in an investigation into its AML compliance program by the U.S. Department of Justice.

TD Bank said its discussions with three United States regulators and the DOJ were ongoing and that it anticipates additional monetary penalties.

The bank said the provision does not reflect the final aggregate amount of potential monetary penalties, or any non-monetary penalties "which are unknown and not reliably estimable at this time".

"TD's AML program was insufficient to effectively monitor, detect, report, and respond to suspicious activity. Work has been underway to remedy these deficiencies," the company said in a statement.

Analysts expected the fine to be anywhere between $500 million and $1 billion - a sum the lender can comfortably afford, given its strong capital position.

Earlier this month, TD CEO Bharat Masrani

acknowledged

that the lender's AML compliance program was not up to the mark and that it was working on strengthening it.

Its $13.4 billion acquisition of U.S. regional lender First Horizon was also called off last year, shortly before it disclosed the AML probe, citing delays in regulatory approvals. (Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Anil D'Silva and Pooja Desai)