An influential voice leaves Bay St.

FINANCIAL SERVICES REPORTER

When Don Drummond left the federal civil service in 2000 to become the chief economist of Toronto-Dominion Bank, he didn't really understand the job description. So he looked to Ed Clark, then TD's president and heir apparent, for advice.

"He said, 'I'm going to give you the same answer that my boss at Merrill Lynch gave me when I left the public service: here's your office, it's your job to figure out what you do - but whatever it is, you better make the company a lot of money,' " Mr. Drummond recalled.

He put that tip to good use, quickly building up a profile as one of Bay Street's most influential voices, a sought-after public speaker and a draw for TD's corporate clients.

Soon that voice will fade, as Mr. Drummond announced yesterday he will retire in June from the bank to pursue a career in academia.

During the decade he has spent at TD, Mr. Drummond, 56, helped change the definition of what a bank economist does - partly by heading up government relations for TD, a highly unusual move.

He has also managed to wield impressive influence in political circles: his fingerprints are on everything from Ontario's fiscal plans to tax rules in British Columbia and monetary policy in Ottawa.

Public relations officials at other banks admire what he has done for TD's brand, while simultaneously cringing at the thought that their economists might take the sort of chances Mr. Drummond did of angering government officials when speaking out about controversial policies.

About 7.2 million Canadians are exposed to Mr. Drummond each month, on average, through his appearances on television, on the radio, and in newspapers, magazines and websites, according to data from a research firm, giving him one of the highest profiles of his peers on Bay Street.

As a result of Mr. Drummond's willingness to speak his mind, officials at rival banks who do not want to comment publicly on a topic have often suggested to reporters that they instead call him.

But the high profile comes at a cost. His schedule has him crisscrossing the country most days of the week - he's done about 170 presentations in the last year. "The travel's brutal," he said, which is part of the reason he's looking forward to spending time with his wife and two grown daughters and working on his long neglected golf and tennis games.

After rising through the ranks of the federal bureaucracy, Mr. Drummond's last three roles at the federal Finance department were assistant deputy minister of fiscal policy and economic analysis; assistant deputy minister of tax policy and legislation; and associate deputy minister.

What's likely to pull him away from the golf course is one of the many job offers he said he already has in hand from universities.

"I'm not looking for another full-time career," he said. "This is more a cruel desire to inflict myself on some young students and do some research in the public policy area."

TD will be splitting the government relations and chief economist roles. Mr. Drummond's replacement as head of government relations is yet to be announced. His successor in the economics department is Craig Alexander, TD's deputy chief economist, who said he intends to pick his predecessor's brain as he takes up the challenge of continuing the bank's high-profile public policy role.

Mr. Alexander, 42, said he was confident he had secured the job after being promoted last year, but TD put him through a tough process to ensure he could handle it.

"For an economist, it's the pinnacle of a career path," he said yesterday. "I'm a current affairs junkie, so I'm getting paid to do what I love."

Mr. Alexander's career path included stints at Statistics Canada and in the brokerage arms of rival banks. He said his two main tasks in the new job will be keeping up the momentum on TD's public policy research and building support for the bank's U.S. operations.

More than any other Canadian bank, TD is staking its future growth strategy on the United States, where it now has roughly as many branches as it has in Canada. "The bank's strategic emphasis on expansion in the U.S. means TD Economics will be building up the capacity to do more research on U.S. issues," Mr. Alexander said. "And maybe even take on some public policy issues in the U.S. as well."

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DRUMMOND'S BEST CALL: "[It]started with my final act at Finance. That was to start the ball rolling on lowering Canada's excessive taxation of capital. The 2000 budget started the corporate income tax reductions. That was the last budget I co-ordinated. There has been a virtual revolution in capital taxation since. All governments have participated - Liberal, Conservative, federal and provincial."

HIS WORST: "Calling the economic weakness too early from the mess in U.S. housing. I had observed in the past that U.S. consumers pulled back on consumption within six months of housing prices declining. But I underestimated their desire to spend their brains out. And I overestimated the size of U.S. bankers' brains. ... So we missed the extent of the recession when it finally came."