The head of Toronto-Dominion Bank is satisfied the lender has a more than adequate capital buffer in place to weather any future economic storms.

In an interview Friday, TD Group President and Chief Executive Officer Bharat Masrani said given expectations that consumer spending will be unleashed once pandemic restrictions are eased and eliminated, the subsequent surge in economic activity will make it highly unlikely the bank needs to set aside more money for potentially sour loans.

“We see great signs in the economy; in North America things are opening up, vaccinations are flowing out, and whenever we’ve seen a reopening of some kind, we see very good growth and good activity levels, and we are seeing that in the footprints we operate in,” he said.

“Based on that, we feel the provisions needed to come down, and that’s what we did. And frankly, if you look at our coverages going forward, they’re more than healthy. I feel based on what we’re seeing in the economy, see the level of activity, that’s an appropriate level to have.”

Provisions for credit losses (PCL) at TD Bank peaked at $3.218 billion in the second quarter of 2020, during the worst of the uncertainty around the impact of the pandemic. The bank reversed course in its most recent fiscal quarter, releasing $377 million from its provisions, which has the effect of moving those funds back into its profit stream.

Masrani said he’s heartened that the ballooning household savings rate will boost overall output through the second half of the year, as consumers who built up their household balance sheets during pandemic restrictions are able to deploy some of that cash at newly-reopened businesses.

“There’s a huge amount of pent-up demand. If you look at economic growth forecasts, if you look at activities, you would expect that the economy will be quite buoyant,” he said.

“And that should bode well for jobs, and hence for growth in the economy.”