TD Bank Mulls Hedging Data Center Debt With Rare SRT Deal (1)

Toronto-Dominion Bank is weighing a rare type of significant risk transfer to hedge current and future data center exposure as tech companies ramp up artificial intelligence investment.

The initial size of the reference portfolio is around $1 billion, according to people familiar with the matter. The potential transaction would include a forward-flow arrangement, which allows the bank to increase the size of the SRT over time, said the people, who asked not to be identified because the matter is private.

The bank would be able to include data center debt it originates over a set period, rather than in ...