TCF Reports 2010 Earnings Increase of 68.3% – Earns $146.6 Million, $1.05 Per Share

2010 HIGHLIGHTS

  • Diluted earnings per common share of $1.05, up 94.4 percent
  • Net income of $146.6 million, up 68.3 percent
  • Net interest margin of 4.14 percent
  • Increased total equity by $300.4 million, Tier 1 common capital increased 27 percent to 9.71 percent
  • Specialty Finance loans and leases up $406.6 million, or 11.5 percent
  • Total revenues of $1.2 billion, up 6.8 percent

FOURTH QUARTER HIGHLIGHTS

  • Diluted earnings per common share of 22 cents, up 46.7 percent, from the fourth quarter of 2009
  • Net income of $30.7 million, up 57.9 percent, from the fourth quarter of 2009
  • Net interest margin of 4.04 percent
  • Total non-performing assets down $19.6 million, or 3.9 percent, from September 30, 2010
  • Announced quarterly cash dividend of five cents per common share, payable February 28, 2011

WAYZATA, Minn.--()--TCF Financial Corporation (NYSE: TCB):

     
Earnings Summary   Table 1
($ in thousands, except per-share data)       Percent Change  
4Q 3Q   4Q 4Q10 vs   4Q10 vs YTD   YTD   Percent
2010   2010   2009   3Q10   4Q09   2010   2009   Change
Net income $ 30,725 $ 36,893 $ 19,456 (16.7 )% 57.9 % $ 146,564 $ 87,097 68.3 %
Diluted earnings per common share(1) .22 .26 .15 (15.4 ) 46.7 1.05 .54 94.4
 

Financial Ratios(2)

Return on average assets .68 % .84 % .43 % .82 % .49 %
Return on average common equity(1) 8.25 9.95 6.57 10.36 5.95
Net interest margin 4.04 4.12 4.07 4.14 3.87
Net charge-offs as a percentage of 1.75 1.58 1.35 1.47 1.34
average loans and leases
 
(1) Includes a non-cash deemed preferred stock dividend of $12,025 recorded during the year ended December 31, 2009. Excluding this amount, diluted earnings per common share was $.64 and the return on average common equity was 8.57% for the year ended December 31, 2009.

(2) Annualized.

 

TCF Financial Corporation (“TCF”) (NYSE: TCB) today reported diluted earnings per common share of 22 cents for the fourth quarter of 2010, compared with 15 cents in the fourth quarter of 2009, an increase of 46.7 percent. Net income for the fourth quarter of 2010 was $30.7 million, compared with $19.5 million in the fourth quarter of 2009, an increase of 57.9 percent.

Diluted earnings per common share for the year ended December 31, 2010 was $1.05, compared with 54 cents for the same 2009 period, an increase of 94.4 percent. Net income for the year ended December 31, 2010 was $146.6 million, compared with $87.1 million for the same 2009 period, an increase of 68.3 percent.

TCF declared a quarterly cash dividend of five cents per common share payable on February 28, 2011 to stockholders of record at the close of business on January 28, 2011.

Chairman’s Statement

“Despite a troubled economy and numerous legislative and regulatory burdens, TCF is reporting its 63rd consecutive quarter of profitability and a record high level of capital,” said William A. Cooper, TCF Chairman and CEO. “We continue to focus on our conservative banking philosophy, which has proven its sustainability throughout the current economic cycle. We are seeing encouraging signs on the credit front, such as a decrease of nearly $20 million in non-performing assets from the third quarter (the first decrease in non-performing assets in 18 quarters). Throughout 2010, we have demonstrated an ability to meet our challenges head-on. This proactive approach has proven to be the right thing to do for our customers and stockholders.”

       
Total Revenue     Table 2
    Percent Change        
($ in thousands)   4Q   3Q   4Q 4Q10 vs   4Q10 vs YTD YTD Percent
2010   2010   2009     3Q10   4Q09     2010   2009   Change
Net interest income $ 174,286     $ 173,755     $ 169,641   .3 % 2.7 % $ 699,202     $ 633,006   10.5 %
Fees and other revenue:
Fees and service charges 61,480 67,684 74,875 (9.2 ) (17.9 ) 273,181 286,908 (4.8 )
Card revenue 27,625 27,779 26,813 (.6 ) 3.0 111,067 104,770 6.0
ATM revenue   6,985       7,985       7,006   (12.5 ) (.3 )   29,836       30,438   (2.0 )
Total banking fees 96,090 103,448 108,694 (7.1 ) (11.6 ) 414,084 422,116 (1.9 )
Leasing and equipment 23,402 24,912 24,408 (6.1 ) (4.1 ) 89,194 69,113 29.1
finance
Other   817       1,077       2,764   (24.1 ) (70.4 )   5,584       5,239   6.6
Total fees and other revenue 120,309 129,437 135,866 (7.1 ) (11.5 ) 508,862 496,468 2.5
Gains on securities, net   21,185       8,505       7,283   149.1 190.9   29,123       29,387   (.9 )
Total non-interest income   141,494       137,942       143,149   2.6 (1.2 )   537,985       525,855   2.3
Total revenue $ 315,780     $ 311,697     $ 312,790   1.3 1.0 $ 1,237,187     $ 1,158,861   6.8
 
Net interest margin(1) 4.04 % 4.12 % 4.07 % 4.14 % 3.87 %
Fees and other revenue as
a % of total revenue 38.10 41.53 43.44 41.13 42.84
 
N.M. = Not meaningful.
(1) Annualized.                                    
 

Net Interest Income

  • Net interest income increased $4.6 million, or 2.7 percent, from the fourth quarter of 2009 and was up slightly from the third quarter of 2010. The increase in net interest income from the fourth quarter of 2009 was primarily due to decreased rates paid on deposits and increases in Specialty Finance loans and leases, partially offset by the impact of increased asset liquidity and decreased income from consumer loans.
  • Net interest margin in the fourth quarter of 2010 was 4.04 percent, compared with 4.07 percent in the fourth quarter of 2009 and 4.12 percent in the third quarter of 2010. The decrease in net interest margin from the fourth quarter of 2009 was primarily due to increased asset liquidity and lower asset yields as a result of the lower interest rate environment, the mix of fixed- and variable-rate loans and leases and higher average balances of non-accrual loans and leases, partially offset by lower average rates on deposits. The decrease from the third quarter of 2010 was primarily due to increased asset liquidity and lower yields on loans and leases primarily due to the impact of Specialty Finance acquisitions late in the third quarter of 2010, partially offset by slightly lower average rates on deposits and the impact of lower average borrowing costs. Since the end of 2009, TCF has been repositioning its balance sheet for an eventual increase in interest rates. While this has negatively impacted the net interest margin rate in the short term, the balance sheet composition, based on TCF’s interest rate gap assumptions, has shifted to an asset sensitive position of 2.8 percent as of December 31, 2010, from a liability sensitive position of 6.6 percent at December 31, 2009.
  • During the fourth quarter of 2010, TCF continued to increase its asset-based liquidity position by increasing the average balance of its interest-bearing deposits held at the Federal Reserve by $211.8 million from the fourth quarter of 2009 and $82.6 million, or 56.2 percent, from the third quarter of 2010.

Non-interest Income

  • Banking fees and service charges in the fourth quarter of 2010 were $61.5 million, down $13.4 million, or 17.9 percent, from the fourth quarter of 2009 and down $6.2 million, or 9.2 percent, from the third quarter of 2010. The decrease in banking fees and service charges from the fourth quarter of 2009 was primarily due to a decrease in activity-based fee revenue as a result of the implementation of recent overdraft fee regulations and changes in customer banking and spending behavior, partially offset by increased monthly maintenance fee income. The decrease in banking fees and service charges from the third quarter of 2010 was primarily due to a full quarter effect of the overdraft fee regulations implemented in August 2010 and lower monthly maintenance fees as more customers qualify for fee waivers.
  • Card revenues were $27.6 million in the fourth quarter of 2010, up $812 thousand, or 3 percent, from the fourth quarter of 2009 and relatively flat from the third quarter of 2010. The increase from the fourth quarter of 2009 was primarily the result of an increase in average spending per active account, partially offset by a decrease in active accounts. Card revenues were flat from the third quarter of 2010 due primarily to increases in average spending per account, offset by decreases in active accounts and in the average interchange rate.
  • Leasing and equipment finance revenues were $23.4 million in the fourth quarter of 2010, down $1 million, or 4.1 percent, from the fourth quarter of 2009 and down $1.5 million, or 6.1 percent, from the third quarter of 2010. The decrease from the fourth quarter of 2009 was primarily due to decreased operating lease revenue as a result of operating lease runoff from the Fidelity National Capital, Inc. acquisition that occurred during the third quarter of 2009, which was partially offset by a corresponding decrease in operating lease depreciation. The decrease in leasing revenues from the third quarter of 2010 was primarily due to decreased sales-type lease activity, due mainly to a high level of customer buyout activity during the third quarter of 2010 and other customer-driven factors not within TCF’s control.

Securities Available for Sale

           
Average Securities Available for Sale     Table 3
          Yield         Yield
($ in thousands) 4Q 3Q 4Q   YTD YTD YTD  

YTD

2010   2010   2009     4Q10   4Q09     2010   2009   2010  

2009

U.S. Government sponsored entities:
Mortgage-backed securities $ 1,729,928 $ 1,796,348 $ 1,497,672 4.16 % 4.73 % $ 1,817,413 $ 1,645,544 4.42 % 4.92 %
Debentures - - 413,647 - 2.23 - 389,245 - 2.18
U.S. Treasury Bills 198,895 69,705 67,932 .13 .07 71,233 17,123 .13 .07
Other securities   2,945     3,473     540 .54 4.42   3,963     508 .50 5.12
Total $ 1,931,768   $ 1,869,526   $ 1,979,791 3.74 4.05 $ 1,892,609   $ 2,052,420 4.25 4.36
                                                           
  • At December 31, 2010, net unrealized losses in the available for sale security portfolio were $25.8 million.
  • During the fourth quarter of 2010, TCF recognized net gains of $21.9 million on the sale of $408.4 million of mortgage-backed securities in the available for sale securities portfolio.
  • At December 31, 2010, TCF held $1.9 billion of mortgage-backed securities and $25 million of U.S. Treasury Bills.
   

Loans and Leases

       
Average Loans and Leases     Table 4
      Percent Change        
($ in thousands) 4Q 3Q 4Q 4Q10 vs   4Q10 vs YTD YTD Percent
2010   2010   2009     3Q10   4Q09     2010   2009   Change
Consumer real estate
First mortgage lien $ 4,924,399 $ 4,935,583 $ 4,954,306 (.2 ) % (.6 )% $ 4,934,257 $ 4,932,315 - %
Junior lien   2,272,857     2,297,433     2,321,045 (1.1 ) (2.1 )   2,296,400     2,351,033 (2.3 )
Total 7,197,256 7,233,016 7,275,351 (.5 ) (1.1 ) 7,230,657 7,283,348 (.7 )
Consumer other   23,283     25,130     32,676 (7.3 ) (28.7 )   26,577     35,849 (25.9 )
Total consumer 7,220,539 7,258,146 7,308,027 (.5 ) (1.2 ) 7,257,234 7,319,197 (.8 )
Commercial real estate 3,322,619 3,327,417 3,241,269 (.1 ) 2.5 3,311,634 3,136,699 5.6
Commercial business   328,287     346,431     443,013 (5.2 ) (25.9 )   375,390     475,674 (21.1 )
Total commercial 3,650,906 3,673,848 3,684,282 (.6 ) (.9 ) 3,687,024 3,612,373 2.1
Leasing and
equipment finance 3,155,472 3,002,714 3,049,093 5.1 3.5 3,056,006 2,826,835 8.1
Inventory finance   803,157     655,485     383,291 22.5 109.5   677,214     179,990

N.M. 

Total $ 14,830,074   $ 14,590,193   $ 14,424,693 1.6 2.8 $ 14,677,478   $ 13,938,395 5.3
 
N.M. = Not meaningful.                  
 
  • Average consumer real estate loan balances decreased $78.1 million, or 1.1 percent, from the fourth quarter of 2009 and declined slightly compared with balances in the third quarter of 2010. This reflects low consumer demand for financing due in part to declines in home values and reduced levels of consumer spending in the weak economy.
  • Variable-rate consumer real estate loans increased $407.9 million from the fourth quarter of 2009 and increased $109.5 million from the third quarter of 2010, while fixed-rate consumer real estate loans decreased $486 million from the fourth quarter of 2009 and decreased $145.3 million from the third quarter of 2010. Variable-rate loans comprised 33 percent of total consumer real estate loans at December 31, 2010, up from 26.8 percent at December 31, 2009 and 31.6 percent at September 30, 2010.
  • As of December 31, 2010, 74.9 percent of TCF’s consumer real estate lending portfolio consisted of closed-end loans with amortizing principal payments, while 25.1 percent were lines of credit.
  • Average commercial loan balances in the fourth quarter of 2010 declined slightly compared with balances in the fourth quarter of 2009 and the third quarter of 2010. Excluding declines in loans in Michigan, the commercial portfolio grew 1.7 percent from the fourth quarter of 2009 and was flat from the third quarter of 2010. Average commercial real estate balances increased $81.4 million or 2.5 percent from the fourth quarter of 2009 and were flat from the third quarter of 2010. Average commercial business balances decreased $114.7 million from the fourth quarter of 2009 and $18.1 million from the third quarter of 2010 due primarily to decreases in demand for commercial business loans due to the continued weakened economy.
  • Average leasing and equipment finance balances increased $106.4 million, or 3.5 percent, from the fourth quarter of 2009 and $152.8 million, or 5.1 percent, from the third quarter of 2010. Average leasing and equipment finance balances in 2010 increased $229.2 million, or 8.1 percent, from 2009. These increases were primarily due to portfolio acquisitions near the end of the third quarter of 2010 and the acquisition of Fidelity National Capital, Inc., which occurred late in the third quarter of 2009.
  • Average inventory finance loans increased $419.9 million, or 109.5 percent, from the fourth quarter of 2009 and $147.7 million, or 22.5 percent, from the third quarter of 2010. The increase from the fourth quarter of 2009 was primarily due to growth in lawn and garden programs and TCF’s entrance in the power sports industry in the third quarter of 2010. The increase from the third quarter of 2010 was primarily due to TCF’s entrance into the power sports industry with the acquisition of $125.8 million in loans from Arctic Cat Sales Inc. late in the third quarter of 2010. This acquisition contributed $175.3 million to the increase in year-over-year average balances and $144.1 million to the increase in average balances from the third quarter of 2010.

Credit Quality

The following table summarizes TCF’s loan and lease portfolio based on the most important credit quality data components that should be used to understand the overall conditions of the portfolio.

     
Credit Quality Summary of Performing and Underperforming Loans and Leases   Table 5
         

December 31, 2010:

Performing Loans and Leases

60+ Days
Delinquent and
Accruing(2)

Accruing
TDRs

Non-accrual
loans and
leases

Total Loans
and Leases

(In thousands) Non-classified   Classified(1)   Total        
Consumer real estate and other $ 6,613,610   $ —   $ 6,613,610 $ 76,711 $ 337,401 $ 167,547 $ 7,195,269
Commercial real estate and commercial business 3,091,911 354,185 3,446,096 9,021 48,838 142,248 3,646,203
Leasing and equipment finance 3,073,347 35,695 3,109,042 11,029 — 34,407 3,154,478
Inventory finance   785,245       5,710       790,955       344       —       1,055       792,354  
Total loans and leases $ 13,564,113     $ 395,590     $ 13,959,703     $ 97,105     $ 386,239     $ 345,257     $ 14,788,304  
Percent of total loans and leases 91.7 % 2.7 % 94.4 % .7 % 2.6 % 2.3 % 100.0 %
                             
 

September 30, 2010:

Performing Loans and Leases

60+ Days
Delinquent and
Accruing(2)

Accruing
TDRs

Non-accrual
loans and
leases

Total Loans
and Leases

Non-classified   Classified(1)   Total        
Consumer real estate and other $ 6,714,413 $ — $ 6,714,413 $ 83,856 $ 315,588 $ 166,597 $ 7,280,454
Commercial real estate and commercial business 3,115,812 378,624 3,494,436 1,260 5,468 161,889 3,663,053
Leasing and equipment finance 3,074,445 32,616 3,107,061 9,956 — 40,455 3,157,472
Inventory finance   788,084       6,403       794,487       264       —       871       795,622  
Total loans and leases $ 13,692,754     $ 417,643     $ 14,110,397     $ 95,336     $ 321,056     $ 369,812     $ 14,896,601  
Percent of total loans and leases 91.9 % 2.8 % 94.7 % .6 % 2.2 % 2.5 % 100.0 %
     
 

December 31, 2009:

Performing Loans and Leases

60+ Days
Delinquent and
Accruing(2)

Accruing
TDRs

Non-accrual
loans and
leases

Total Loans
and Leases

Non-classified   Classified(1)   Total        
Consumer real estate and other $ 6,863,222 $ — $ 6,863,222 $ 76,959 $ 252,510 $ 139,300 $ 7,331,991
Commercial real estate and commercial business 3,280,957 331,298 3,612,255 68 — 106,196 3,718,519
Leasing and equipment finance 2,967,540 31,767 2,999,307 22,114 — 50,008 3,071,429
Inventory finance   467,319       —       467,319       715       —       771       468,805  
Total loans and leases $ 13,579,038     $ 363,065     $ 13,942,103     $ 99,856     $ 252,510     $ 296,275     $ 14,590,744  
Percent of total loans and leases 93.1 % 2.5 % 95.6 % .7 % 1.7 % 2.0 % 100.0 %
 

(1) Excludes classified loans and leases that are 60+ days delinquent or accruing TDRs.

(2) Excludes accruing TDRs that are 60+ delinquent.

 
  • Within the current performing loans and leases, TCF classifies customers within regulatory classification guidelines. Loans and leases that are “classified” mean that management has concerns regarding the ability of the borrowers to meet existing loan terms but may never become non-performing or result in a loss.
  • Performing loans that are 60+ days delinquent have a higher potential to become non-performing and generally are a leading indicator for future charge-off trends.
  • Accruing troubled debt restructurings (“TDRs”) are loans to borrowers that have been modified such that TCF has granted a concession in terms to improve the likelihood of collection of all principal owed.
  • Non-accrual loans and leases generally have been charged down to the estimated fair value of the collateral less selling costs or reserved for expected loss upon workout.

When classified loans and leases become 60 or more days delinquent, they are included within “60+ days delinquent and accruing” in the previous table. Accruing TDRs, regardless of classification or delinquency status, are included within “accruing TDRs” in the previous table.

At December 31, 2010:

  • Over 60-day delinquency rate was .79 percent, up from .69 percent at December 31, 2009 and flat compared with .78 percent at September 30, 2010. The increase from the fourth quarter of 2009 was primarily due to increases in commercial real estate and consumer real estate, partially offset by decreases in equipment finance and inventory finance loan delinquencies. The delinquency rate increased from the third quarter of 2010 as increases in commercial real estate loans and leasing and equipment finance delinquencies were offset by decreases in consumer real estate.
  • Total accruing consumer real estate TDRs were $337.4 million, up $84.9 million, or 33.6 percent, from December 31, 2009 and up $21.8 million, or 6.9 percent, from September 30, 2010. The allowance for loan losses on accruing consumer real estate TDRs was $36.8 million, or 10.9 percent of the outstanding balance, at December 31, 2010. The over 60-day delinquencies included in accruing consumer real estate TDRs were $17.9 million, or 5.3 percent, at December 31, 2010, compared with $17.4 million, or 5.5 percent, at September 30, 2010.
  • Total accruing commercial real estate TDRs were $48.8 million at December 31, 2010, compared with $5.5 million at September 30, 2010, as TCF continues to work with financially stressed commercial customers to reduce the likelihood of default and potential charge-offs. These loans have been reviewed for impairment on an individual basis. The allowance for loan losses on accruing commercial real estate TDRs was $695 thousand, or just 1.4 percent of the outstanding balance at December 31, 2010, due to the secured nature of these loans. None of the accruing commercial TDRs were over 60-days delinquent.
  • Non-accrual loans and leases increased $49 million, or 16.5 percent, from December 31, 2009 and decreased $24.6 million, or 6.6 percent, from September 30, 2010. The increase from the fourth quarter of 2009 was primarily due to increases in non-accrual consumer real estate and commercial loans, partially offset by decreases in non-accrual equipment finance loans and leases. The decrease from the third quarter of 2010 was primarily due to a $51.7 million decrease in new non-accrual loans, primarily in commercial loans.
 

Allowance for Loan and Lease Losses

           
Allowance for Loan and Lease Losses   Table 6
        Percent Change        
($ in thousands) 4Q 3Q 4Q 4Q10 vs   4Q10 vs YTD YTD Percent
2010   2010   2009     3Q10   4Q09     2010   2009   Change
Allowance for Loan and Lease Losses
Balance at beginning of period $ 253,120 $ 251,643 $ 215,732 .6 % 17.3 % $ 244,471 $ 172,442 41.8 %
Charge-offs (69,913 ) (62,945 ) (52,841 ) 11.1 32.3 (237,063 ) (202,398 ) 17.1
Recoveries   4,966       5,135       4,191   3.3 (18.5 )   21,974       15,891   (38.3 )
Net charge-offs (64,947 ) (57,810 ) (48,650 ) 12.3 33.5 (215,089 ) (186,507 ) 15.3
Provision for credit losses   77,646       59,287       77,389   31.0 .3   236,437       258,536   (8.5 )
Balance at end of period $ 265,819     $ 253,120     $ 244,471   5.0 8.7 $ 265,819     $ 244,471   8.7
 
Net Charge-Offs (Recoveries) as a Percentage of Average Loans and Leases
Consumer real estate and other:
First mortgage lien 1.88 % 1.63 % 1.34 %

25

 bps

54

 bps

1.55 % 1.11 %

44

 bps

Junior lien 2.37 2.50 2.54 (13 ) (17 ) 2.33 2.21 12
Total consumer real estate 2.04 1.91 1.73 13 31 1.80 1.46 34
Consumer other

N.M. 

N.M. 

N.M. 

- -

N.M. 

N.M. 

-
Total consumer real estate and other 2.10 2.00 1.84 10 26 1.86 1.56 30
Commercial real estate 2.08 1.56 .69 52 139 1.36 1.13 23
Commercial business 1.58 (.16 ) 1.51 174 7 .92 1.92 (100 )
Total commercial real estate and commercial business 2.04 1.40 .79 64 125 1.31 1.24 7
Leasing and equipment finance .99 1.16 1.01 (17 ) (2 ) 1.00 .97 3
Inventory finance .28 .05 .09 23 19 .17 .10 7
Total 1.75 1.58 1.35 17 40 1.47 1.34 13
 
Allowance as a percentage of period 1.80 % 1.70 % 1.68 % 1.80 % 1.68 %
end loans and leases
Ratio of allowance to net charge-offs(1) 1.0 X 1.1 X 1.3 X 1.2 X 1.3 X
 
Credit Loss Reserves
Allowance for loan and lease losses $ 265,819 $ 253,120 $ 244,471 5.0 8.7
Reserves for unfunded commitments   2,353       2,696       3,850   (12.7 ) (38.9 )
Total credit loss reserves $ 268,172     $ 255,816     $ 248,321   4.8 8.0
 
N.M. = Not meaningful.
(1) Annualized.      
 

At December 31, 2010:

  • Allowance for loan and lease losses was $265.8 million, or 1.80 percent of loans and leases, compared with $244.5 million, or 1.68 percent, at December 31, 2009 and $253.1 million, or 1.70 percent, at September 30, 2010.

For the quarter ended December 31, 2010:

  • Provision for credit losses was $77.6 million, flat from $77.4 million in the fourth quarter of 2009 and up from $59.3 million recorded in the third quarter of 2010. The increase from the third quarter of 2010 was primarily due to increased reserves and charge-offs in the commercial real estate portfolio.
  • Net loan and lease charge-offs were $64.9 million, or 1.75 percent, annualized, of average loans and leases, up from $48.7 million, or 1.35 percent, annualized, in the fourth quarter of 2009 and up from $57.8 million, or 1.58 percent, annualized, in the third quarter of 2010. Increases over the fourth quarter of 2009 were primarily due to increases in commercial real estate and consumer real estate net charge-offs, with increased consumer real estate net charge-offs occurring primarily in Illinois, partially offset by lower net charge-offs in Minnesota and Michigan. The increase from the third quarter of 2010 was primarily the result of increases in commercial real estate, consumer real estate and commercial business net charge-offs. Leasing and equipment finance net charge-offs were $7.8 million, or .99 percent annualized, of average loans and leases, down from $8.7 million, or 1.16 percent annualized, of average loans and leases in the third quarter of 2010, primarily due to charge-offs of previously reserved non-accrual loans and leases, which resulted in a decrease in the non-accrual balances in the leasing and equipment finance portfolio.
 

Deposits

     
Average Deposits   Table 7
        Percent Change        
($ in thousands) 4Q 3Q 4Q   4Q10 vs   4Q10 vs   YTD YTD Percent
2010   2010   2009     3Q10   4Q09     2010   2009   Change
 
Checking $ 4,358,771 $ 4,341,803 $ 4,116,290 .4 % 5.9 % $ 4,408,853 $ 4,038,964 9.2 %
Savings 5,412,094 5,446,852 5,231,159 (.6 ) 3.5 5,429,416 4,748,774 14.3
Money market   643,801       654,030       671,755   (1.6 ) (4.2 )   656,691       683,030   (3.9 )
Subtotal 10,414,666 10,442,685 10,019,204 (.3 ) 3.9 10,494,960 9,470,768 10.8
Certificates   1,040,348       1,006,685       1,366,871   3.3 (23.9 )   1,054,179       1,915,467   (45.0 )
Total deposits $ 11,455,014     $ 11,449,370     $ 11,386,075   - .6 $ 11,549,139     $ 11,386,235   1.4
 
Average interest rate on deposits     .46 %     .48 %     .74 %                 .53 %     1.07 %    
 
  • Total average deposits increased $68.9 million, or .6 percent, from the fourth quarter of 2009 and were flat with the third quarter of 2010. Total average deposits in 2010 increased $162.9 million, or 1.4 percent, from 2009. The increase from the fourth quarter of 2009 and from the full year of 2009 was primarily due to increases in core deposits, partially offset by decreases in average certificates of deposit resulting from pricing strategies to reduce higher cost funds.
  • The average interest cost of deposits in the fourth quarter of 2010 was .46 percent, down 28 basis points from the fourth quarter of 2009 and down slightly from the third quarter of 2010. The average interest cost of deposits during 2010 was .53 percent, down 54 basis points from 2009. Declines in the average interest cost of deposits were primarily due to pricing strategies on certain deposit products, mix changes and lower market interest rates. The weighted average interest cost of deposits on December 31, 2010 was .41 percent, compared with .48 percent on September 30, 2010 and .65 percent on December 31, 2009.
   

Non-interest Expense

       
Non-interest Expense     Table 8
        Percent Change        
($ in thousands) 4Q 3Q 4Q 4Q10 vs   4Q10 vs   YTD YTD Percent
2010   2010   2009     3Q10   4Q09     2010   2009   Change
Compensation and
employee benefits $ 87,371 $ 90,282 $ 89,374 (3.2 )% (2.2 )% $ 352,861 $ 356,996 (1.2 )%
Occupancy and equipment 30,968 32,091 31,099 (3.5 ) (.4 ) 126,551 126,292 .2
FDIC insurance 7,398 5,486 5,288 34.9 39.9 23,584 19,109 23.4
Deposit account premiums 1,688 3,340 9,347 (49.5 ) (81.9 ) 17,304 30,682 (43.6 )
Advertising and marketing 3,154 3,354 3,789 (6.0 ) (16.8 ) 13,062 17,134 (23.8 )
Other   37,309     39,481       40,193 (5.5 ) (7.2 )   146,253     142,818 2.4
Core operating expenses 167,888 174,034 179,090 (3.5 ) (6.3 ) 679,615 693,031 (1.9 )
Foreclosed real estate and
repossessed assets, net 12,781 9,588 12,537 33.3 1.9 40,385 31,886 26.7
Operating lease depreciation 8,289 8,965 10,750 (7.5 ) (22.9 ) 37,106 22,368 65.9
Other credit costs, net 1,542 (834 ) 4,386 N.M. (64.8 ) 6,018 12,137 (50.4 )
FDIC special assessment   -     -       - - -   -     8,362 (100.0 )
Total non-interest expense $ 190,500   $ 191,753     $ 206,763 (.7 ) (7.9 ) $ 763,124   $ 767,784 (.6 )
 
N.M. = Not meaningful.                                    
 
  • Core operating expenses decreased $11.2 million, or 6.3 percent, from the fourth quarter of 2009, $6.1 million, or 3.5 percent from the third quarter of 2010 and $13.4 million, or 1.9 percent, from the full year of 2010 from 2009. The decrease in all periods was primarily attributable to decreases in deposit account premiums and compensation and employee benefits costs.
  • Compensation and employee benefits costs decreased $2 million, or 2.2 percent, from the fourth quarter of 2009 and $2.9 million, or 3.2 percent from the third quarter of 2010. Compensation and employee benefits costs declined $4.1 million, or 1.2 percent, for the full year of 2010 from 2009. The decreases in all periods were primarily due to headcount reductions and decreased employee medical plan expenses, partially offset by increased costs in the Specialty Finance businesses as a result of expansion and growth.
  • FDIC insurance increased $2.1 million, or 39.9 percent, from the fourth quarter of 2009 and $1.9 million, or 34.9 percent, from the third quarter of 2010. FDIC insurance increased $4.5 million, or 23.4 percent, for the full year of 2010 from 2009. The increases in all periods were primarily due to higher deposit insurance rates. The Dodd-Frank Act requires changes to a number of components of the FDIC insurance assessment, with an expected implementation date by the FDIC of April 1, 2011. The changes amend the current methodology used to determine the assessments paid by institutions with assets greater than $10 billion, including changing the assessment base from deposits to total average assets less tier one capital. Additionally, the FDIC has developed a scorecard approach to determine a separate assessment rate for each institution with assets greater than $10 billion. As a result of these changes, TCF’s FDIC insurance may increase significantly in 2011.
  • Deposit account premiums decreased $7.7 million, or 81.9 percent, from the fourth quarter of 2009 and $1.7 million, or 49.5 percent, from the third quarter of 2010. Deposit account premiums decreased $13.4 million, or 43.6 percent, for the full year of 2010 from 2009. The decreases in deposit account premiums were due to revised marketing strategies and lower checking account production.
  • Advertising and marketing expenses decreased $635 thousand, or 16.8 percent, from the fourth quarter of 2009 and $200 thousand, or 6 percent, from the third quarter of 2010. Advertising and marketing expenses decreased $4.1 million, or 23.8 percent, for the full year of 2010 from 2009. The decrease in all periods was primarily the result of retail banking product strategies and a related decrease in spending on media advertisements.
  • Other non-interest expense decreased $2.9 million, or 7.2 percent, from the fourth quarter of 2009 and $2.2 million, or 5.5 percent, from the third quarter of 2010. Other non-interest expense increased $3.4 million, or 2.4 percent, for the full year of 2010 from 2009. The decrease from the fourth quarter of 2009 was primarily due to a decrease in severance costs, as a result of the reorganization of the company’s structure and business segments in the fourth quarter of 2009. The decrease from the third quarter of 2010 was due in part to decreased deposit losses. In addition, during the fourth quarter of 2010 TCF, based on information made public by Visa U.S.A. Inc. (“Visa”), reduced the contingency obligation related to the Visa indemnification for certain covered litigation matters by $1 million, further contributing to the decrease in other non-interest expense from the fourth quarter of 2009 and the third quarter of 2010. The increase for 2010 compared with 2009 was primarily attributable to increased consulting costs related to administration of the company’s Bank Secrecy Act program and, to a lesser extent, other legal costs including the challenge of the Durbin Amendment of the Dodd-Frank Act, partially offset by lower severance costs.
  • Foreclosed real estate and repossessed asset expenses increased $244 thousand, or 1.9 percent, from the fourth quarter of 2009 and $3.2 million, or 33.3 percent, from the third quarter of 2010. Foreclosed real estate and repossessed asset expenses increased $8.5 million, or 26.7 percent, for the full year of 2010 from 2009. The increase from the fourth quarter of 2009 and the third quarter of 2010 was primarily due to increased valuation adjustments and tax expenses, partially offset by increases in the number of sales and the average net gain or loss at sale. The increase in 2010 from 2009 was primarily due to an increase in the number of consumer real estate properties owned and the associated expenses.
  • Other credit costs decreased $2.8 million, or 64.8 percent, from the fourth quarter of 2009 and increased $2.4 million from the third quarter of 2010. Other credit costs decreased $6.1 million, or 50.4 percent, for the full year of 2010 from 2009. The decrease from the fourth quarter of 2009 and from the full year of 2009 was primarily attributable to the reversal of reserves on several unfunded commitments that were closed and lower costs related to consumer real estate loan pool insurance. The increase from the third quarter of 2010 was primarily due to a decrease in reserves on commercial letters of credit due to the elimination of an exposure on an impaired loan in Michigan during the third quarter of 2010.

Income Taxes

  • Income tax expense was $16 million for the fourth quarter of 2010, or 33.6 percent of pre-tax income, compared with $9.4 million, or 32.8 percent of pre-tax income, for the comparable 2009 period and $22.9 million, or 37.7 percent of pre-tax income, for the third quarter of 2010. The effective tax rate for the fourth quarter of both 2010 and 2009 included the effects of year-to-date changes in the estimated annual effective tax rate of approximately $1 million.
  • Income tax expense was $87.8 million for 2010, or 36.9 percent of pre-tax income, compared with $45.9 million, or 34.6 percent of pre-tax income, for 2009. Income tax expense for 2009 included a $4.2 million decrease in income tax expense related to favorable developments in uncertain tax positions, partially offset by a slight increase in the effective income tax rate.
                     

Capital and Borrowing Capacity

                               
Capital Information                             Table 9
At period end

($ in thousands, except per-share data)

4Q
2010

4Q
2009

 

Total equity $ 1,480,163 $ 1,179,755
Total equity to total assets 8.02 % 6.60 %
Book value per common share $ 10.30 $ 9.10
Tangible realized common equity to tangible assets(1) 7.37 % 5.86 %
 
 
Risk-based capital
Tier 1 $ 1,475,525 10.59 % $ 1,161,750 8.52 %
Total 1,808,412 12.98 1,514,940 11.12
Excess over stated “10% well-capitalized” requirement 415,502 2.98 152,153 1.12
 
Tier 1 common capital(2) $ 1,352,025 9.71 % $ 1,042,357 7.65 %
 
(1) Excludes the impact of goodwill, other intangibles and accumulated other comprehensive income (loss) (see “Reconciliation of GAAP to Non-GAAP Measures” table).
(2) Excludes the effect of qualifying trust preferred securities and qualifying non-controlling interest in subsidiaries (see “Reconciliation of GAAP to Non-GAAP Measures” table).
  • Total risk-based capital at December 31, 2010 of $1.8 billion, or 12.98 percent of risk-weighted assets, was $415.5 million in excess of the stated “10 percent well-capitalized” requirement.
  • On January 18, 2011, the Board of Directors of TCF declared a regular quarterly cash dividend of five cents per common share payable on February 28, 2011 to stockholders of record at the close of business on January 28, 2011.
  • At December 31, 2010, TCF had $1.7 billion in unused, secured borrowing capacity at the FHLB of Des Moines and $529 million in unused, secured borrowing capacity at the Federal Reserve Discount Window.

Website Information

A live webcast of TCF’s conference call to discuss fourth quarter earnings will be hosted at TCF’s website, ir.tcfbank.com, on January 20, 2011 at 10:00 a.m., CT. Additionally, the webcast is available for replay at TCF’s website after the conference call. The website also includes free access to company news releases, TCF’s annual report, quarterly reports, investor presentations and SEC filings.

 

TCF is a Wayzata, Minnesota-based national bank holding company with $18.5 billion in total assets. TCF has 442 banking offices in Minnesota, Illinois, Michigan, Colorado, Wisconsin, Indiana, Arizona and South Dakota, providing retail and commercial banking services. TCF also conducts commercial leasing and equipment finance business in all 50 states and commercial inventory finance business in the U.S. and Canada. For more information about TCF, please visit www.tcfbank.com.

 

Forward-Looking Information

This earnings release and other reports issued by the Company, including reports filed with the SEC, may contain “forward-looking” statements that deal with future results, plans or performance. In addition, TCF’s management may make such statements orally to the media, or to securities analysts, investors or others. Forward-looking statements deal with matters that do not relate strictly to historical facts. TCF’s future results may differ materially from historical performance and forward-looking statements about TCF’s expected financial results or other plans and are subject to a number of risks and uncertainties. These include, but are not limited to the following:

Adverse Economic or Business Conditions, Credit Risks. Continued or deepening deterioration in general economic and banking industry conditions, or continued increases in unemployment in TCF’s primary banking markets; adverse economic, business and competitive developments such as shrinking interest margins, deposit outflows, deposit account attrition, or an inability to increase the number of deposit accounts; adverse changes in credit and other risks posed by TCF’s loan, lease, investment, and securities available for sale portfolios, including continuing declines in commercial or residential real estate values or changes in the allowance for loan and lease losses dictated by new market conditions or regulatory requirements; interest rate risks resulting from fluctuations in prevailing interest rates or other factors that result in a mismatch between yields earned on TCF’s interest-earning assets and the rates paid on its deposits and borrowings.

Earnings/Capital Constraints, Liquidity Risks. Limitations on TCF’s ability to pay dividends or to increase dividends in the future because of financial performance deterioration, regulatory restrictions or limitations; increased deposit insurance premiums, special assessments or other costs related to adverse conditions in the banking industry, the economic impact on banks of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Act”) and Emergency Economic Stabilization Act of 2008, as amended (“EESA”), and other regulatory reform legislation; the impact of financial regulatory reform, including the phase out of trust preferred securities in Tier 1 capital called for by the Act, or additional capital, leverage, liquidity and risk management requirements or changes in the composition of qualifying regulatory capital; adverse changes in securities markets directly or indirectly affecting TCF’s ability to sell assets or to fund its operations; diminished unsecured borrowing capacity resulting from TCF credit rating downgrades and unfavorable conditions in the credit markets that restrict or limit various funding sources; costs associated with new regulatory requirements or interpretive guidance relating to liquidity.

Legislative and Regulatory Requirements. New consumer protection and supervisory requirements, including the Act’s creation of a new consumer protection bureau and limits on Federal preemption for state laws that could be applied to national banks; the imposition of requirements with an adverse impact relating to TCF’s lending, loan collection and other business activities as a result of the EESA and the Act, or other legislative or regulatory developments such as mortgage foreclosure moratorium laws or imposition of underwriting or other limitations that impact the ability to use certain variable-rate products; reduction of interchange revenue from debit card transactions resulting from the so-called Durbin Amendment to the Act, which limits debit card interchange fees to amounts that will only allow issuers to recover incremental costs of authorization, clearance and settlement of debit card transactions, plus possibly some costs relating to fraud prevention; impact of legislative, regulatory or other changes affecting customer account charges and fee income; changes to bankruptcy laws which would result in the loss of all or part of TCF’s security interest due to collateral value declines (so-called “cramdown” provisions); any material failure of TCF to comply with the terms of its Consent Order with the Office of the Comptroller of the Currency relating to TCF’s Bank Secrecy Act compliance, which may result in regulatory enforcement action including monetary penalties; increased health care costs resulting from recently enacted Federal health care reform legislation; adverse regulatory examinations and resulting enforcement actions or other adverse consequences such as increased capital requirements or higher deposit insurance assessments; heightened regulatory practices, requirements or expectations, including, but not limited to, requirements related to the Bank Secrecy Act and anti-money laundering compliance activity.

Risks Relating to New Product Introduction. TCF has introduced a new anchor retail deposit account product that replaces TCF Totally Free Checking, and that calls for a monthly maintenance fee on accounts not meeting certain specific requirements. TCF has also implemented new regulatory requirements that prohibit financial institutions from charging NSF fees on point-of-sale and ATM transactions unless customers opt-in. Customer acceptance of the new product changes and regulatory requirements cannot be predicted with certainty, and these changes may have an adverse impact on TCF’s ability to generate and retain accounts and on its fee revenue.

Litigation Risks. Results of litigation, including class action litigation concerning TCF’s lending or deposit activities including account servicing processes or fees or charges, or employment practices, and possible increases in indemnification obligations for certain litigation against Visa U.S.A. (“covered litigation”) and potential reductions in card revenues resulting from covered litigation or other litigation against Visa.

Competitive Conditions; Supermarket Branching Risk. Reduced demand for financial services and loan and lease products; adverse developments affecting TCF’s supermarket banking relationships or any of the supermarket chains in which TCF maintains supermarket branches.

Accounting, Audit, Tax and Insurance Matters. Changes in accounting standards or interpretations of existing standards; federal or state monetary, fiscal or tax policies, including adoption of state legislation that would increase state taxes; adverse state or Federal tax assessments or findings in tax audits; lack of or inadequate insurance coverage for claims against TCF.

Technological and Operational Matters. Technological, computer-related or operational difficulties or loss or theft of information and the possibility that deposit account losses (fraudulent checks, etc.) may increase.

Investors should consult TCF’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K for additional important information about the Company.

 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
           
Three Months Ended
December 31, Change
2010 2009 $ %
Interest income:
Loans and leases $ 220,772 $ 222,300 $ (1,528 ) (.7 ) %
Securities available for sale 18,072 20,035 (1,963 ) (9.8 )
Investments and other   1,900   1,160     740   63.8
Total interest income   240,744   243,495     (2,751 ) (1.1 )
Interest expense:
Deposits 13,370 21,171 (7,801 ) (36.8 )
Borrowings   53,088   52,683     405   .8
Total interest expense   66,458   73,854     (7,396 ) (10.0 )
Net interest income 174,286 169,641 4,645 2.7
Provision for credit losses   77,646   77,389     257   .3
Net interest income after provision for
credit losses   96,640   92,252     4,388   4.8
Non-interest income:
Fees and service charges 61,480 74,875 (13,395 ) (17.9 )
Card revenue 27,625 26,813 812 3.0
ATM revenue   6,985   7,006     (21 ) (.3 )
Subtotal 96,090 108,694 (12,604 ) (11.6 )
Leasing and equipment finance 23,402 24,408 (1,006 ) (4.1 )
Other   817   2,764     (1,947 ) (70.4 )
Fees and other revenue 120,309 135,866 (15,557 ) (11.5 )
Gains on securities, net   21,185   7,283     13,902   190.9
Total non-interest income   141,494   143,149     (1,655 ) (1.2 )
Non-interest expense:
Compensation and employee benefits 87,371 89,374 (2,003 ) (2.2 )
Occupancy and equipment 30,968 31,099 (131 ) (.4 )
FDIC insurance 7,398 5,288 2,110 39.9
Deposit account premiums 1,688 9,347 (7,659 ) (81.9 )
Advertising and marketing 3,154 3,789 (635 ) (16.8 )
Other   37,309   40,193     (2,884 ) (7.2 )
Subtotal 167,888 179,090 (11,202 ) (6.3 )
Foreclosed real estate and repossessed assets, net 12,781 12,537 244 1.9
Operating lease depreciation 8,289 10,750 (2,461 ) (22.9 )
Other credit costs, net   1,542   4,386     (2,844 ) (64.8 )
Total non-interest expense   190,500   206,763     (16,263 ) (7.9 )
Income before income tax expense 47,634 28,638 18,996 66.3
Income tax expense   16,011   9,385     6,626   70.6
Income after income tax expense 31,623 19,253 12,370 64.2
Income (loss) attributable to non-controlling interest   898   (203 )   1,101   N.M.
Net income available to common stockholders $ 30,725 $ 19,456   $ 11,269   57.9
 
Net income per common share:
Basic $ .22 $ .15 $ .07 46.7
Diluted .22 .15 .07 46.7
 
Dividends declared per common share $ .05 $ .05 $ - -
 
Average common and common equivalent
shares outstanding (in thousands):
Basic 140,970 127,157 13,813 10.9
Diluted 141,216 127,203 14,013 11.0
 
N.M. Not meaningful.
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
           
 
Year Ended
December 31. Change
2010 2009 $   %
Interest income:
Loans and leases $ 883,923 $ 864,384 $ 19,539 2.3 %
Securities available for sale 80,445 89,427 (8,982 ) (10.0 )
Investments and other   5,509   4,370     1,139   26.1
Total interest income   969,877   958,181     11,696   1.2
Interest expense:
Deposits 61,229 122,112 (60,883 ) (49.9 )
Borrowings   209,446   203,063     6,383   3.1
Total interest expense   270,675   325,175     (54,500 ) (16.8 )
Net interest income 699,202 633,006 66,196 10.5
Provision for credit losses   236,437   258,536     (22,099 ) (8.5 )
Net interest income after provision for
credit losses   462,765   374,470     88,295   23.6
Non-interest income:
Fees and service charges 273,181 286,908 (13,727 ) (4.8 )
Card revenue 111,067 104,770 6,297 6.0
ATM revenue   29,836   30,438     (602 ) (2.0 )
Subtotal 414,084 422,116 (8,032 ) (1.9 )
Leasing and equipment finance 89,194 69,113 20,081 29.1
Other   5,584   5,239     345   6.6
Fees and other revenue 508,862 496,468 12,394 2.5
Gains on securities, net   29,123   29,387     (264 ) (.9 )
Total non-interest income   537,985   525,855     12,130   2.3
Non-interest expense:
Compensation and employee benefits 352,861 356,996 (4,135 ) (1.2 )
Occupancy and equipment 126,551 126,292 259 .2
FDIC insurance 23,584 19,109 4,475 23.4
Deposit account premiums 17,304 30,682 (13,378 ) (43.6 )
Advertising and marketing 13,062 17,134 (4,072 ) (23.8 )
Other   146,253   142,818     3,435   2.4
Subtotal 679,615 693,031 (13,416 ) (1.9 )
Foreclosed real estate and repossessed assets, net 40,385 31,886 8,499 26.7
Operating lease depreciation 37,106 22,368 14,738 65.9
Other credit costs, net 6,018 12,137 (6,119 ) (50.4 )
FDIC special assessment   -   8,362     (8,362 ) (100.0 )
Total non-interest expense   763,124   767,784     (4,660 ) (.6 )
Income before income tax expense 237,626 132,541 105,085 79.3
Income tax expense   87,765   45,854     41,911   91.4
Income after income tax expense 149,861 86,687 63,174 72.9
Income (loss) attributable to non-controlling interest   3,297   (410 )   3,707   N.M.
Net income 146,564 87,097 59,467 68.3
Preferred stock dividends - 6,378 (6,378 ) (100.0 )
Non-cash deemed preferred stock dividend   -   12,025     (12,025 ) (100.0 )
Net income available to common stockholders $ 146,564 $ 68,694   $ 77,870   113.4
 
Net income per common share:
Basic $ 1.05 $ .54 $ .51 94.4
Diluted 1.05 .54 .51 94.4
 
Dividends declared per common share $ .20 $ .40 $ (.20 ) (50.0 )
 
Average common and common equivalent
shares outstanding (in thousands):
Basic 138,617 126,593 12,024 9.5
Diluted 138,813 126,594 12,219 9.7
 
N.M. Not meaningful.
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per-share data)
(Unaudited)
           
 
At At
December 31, December 31, Change
2010 2009 $   %
ASSETS
 
Cash and due from banks

$

663,901 $ 299,127 $ 364,774 121.9 %
Investments 179,768 163,692 16,076 9.8
Securities available for sale 1,931,174 1,910,476 20,698 1.1
Loans and leases:
Consumer real estate and other 7,195,269 7,331,991 (136,722 ) (1.9 )
Commercial real estate 3,328,216 3,269,003 59,213 1.8
Commercial business 317,987 449,516 (131,529 ) (29.3 )
Leasing and equipment finance 3,154,478 3,071,429 83,049 2.7
Inventory finance   792,354     468,805   323,549 69.0
Total loans and leases 14,788,304 14,590,744 197,560 1.4
Allowance for loan and lease losses   (265,819 )   (244,471 ) (21,348 ) 8.7
Net loans and leases 14,522,485 14,346,273 176,212 1.2
Premises and equipment, net 443,768 447,930 (4,162 ) (.9 )
Goodwill 152,599 152,599 - -
Other assets   571,330     565,078   6,252 1.1
Total assets $ 18,465,025   $ 17,885,175   $ 579,850 3.2
 
LIABILITIES AND EQUITY
 
Deposits:
Checking $ 4,530,064 $ 4,400,290 $ 129,774 2.9
Savings 5,390,802 5,339,955 50,847 1.0
Money market   635,922     640,569   (4,647 ) (.7 )
Subtotal 10,556,788 10,380,814 175,974 1.7
Certificates of deposit   1,028,327     1,187,505   (159,178 ) (13.4 )
Total deposits   11,585,115     11,568,319   16,796 .1
Short-term borrowings 126,790 244,604 (117,814 ) (48.2 )
Long-term borrowings   4,858,821     4,510,895   347,926 7.7
Total borrowings 4,985,611 4,755,499 230,112 4.8
Accrued expenses and other liabilities   414,136     381,602   32,534 8.5
Total liabilities   16,984,862     16,705,420   279,442 1.7
Equity:
Preferred stock, par value $.01 per share,
30,000,000 authorized; 0 shares issued - - - -
Common stock, par value $.01 per share,
280,000,000 shares authorized; 142,965,012
and 130,339,500 shares issued 1,430 1,303 127 9.7
Additional paid-in capital 459,884 297,429 162,455 54.6
Retained earnings, subject to certain restrictions 1,064,978 946,002 118,976 12.6
Accumulated other comprehensive loss (31,514 ) (18,545 ) (12,969 ) 69.9
Treasury stock at cost, 51,160 and 1,136,688
shares, and other   (23,115 )   (50,827 ) 27,712 (54.5 )
Total TCF Financial Corp. stockholders' equity   1,471,663     1,175,362   296,301 25.2
Non-controlling interest in subsidiaries   8,500     4,393   4,107 93.5
Total equity   1,480,163     1,179,755   300,408 25.5
Total liabilities and equity $ 18,465,025   $ 17,885,175   $ 579,850 3.2
 
N.M. Not meaningful.
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CREDIT QUALITY DATA
(Dollars in thousands)
(Unaudited)
             
At At At At At Change from
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Dec. 31,
2010 2010 2010 2010 2009 2010 2009

Delinquency Data - Principal Balances (1)

60 days or more:
Consumer real estate
First mortgage lien $ 73,848 $ 80,795 $ 85,581 $ 80,883 $ 65,074 $ (6,947 ) $ 8,774
Junior lien   20,763   20,387   21,152   22,293   17,942   376     2,821  
Total consumer real estate 94,611 101,182 106,733 103,176 83,016 (6,571 ) 11,595
Consumer other   39   61   131   105   215   (22 )   (176 )
Total consumer real estate and other 94,650 101,243 106,864 103,281 83,231 (6,593 ) 11,419
Commercial real estate 8,856 1,260 7,819 - 22 7,596 8,834
Commercial business 165 - 53 - 46 165 119
Leasing and equipment finance 5,054 4,346 5,817 9,869 11,263 708 (6,209 )
Inventory finance   318   255   178   674   705   63     (387 )
Subtotal 109,043 107,104 120,731 113,824 95,267 1,939 13,776
Acquired portfolios   6,000   5,618   8,078   9,185   10,862   382     (4,862 )
Total delinquencies $ 115,043 $ 112,722 $ 128,809 $ 123,009 $ 106,129 $ 2,321   $ 8,914  
 

Delinquency Data - % of Portfolio

60 days or more:
Consumer real estate
First mortgage lien 1.55 % 1.68 % 1.78 % 1.68 % 1.34 % (13 )

bps

21

bps

Junior lien .93 .90 .93 .98 .78 3 15
Total consumer real estate 1.35 1.43 1.51 1.45 1.16 (8 ) 19
Consumer other .10 .14 .27 .22 .42 (4 ) (32 )
Total consumer real estate and other 1.35 1.42 1.50 1.44 1.16 (7 ) 19
Commercial real estate .27 .04 .24 - - 23 27
Commercial business .06 - .02 - .01 6 5
Leasing and equipment finance .19 .17 .23 .39 .44 2 (25 )
Inventory finance .05 .04 .03 .10 .19 1 (14 )
Subtotal .79 .78 .87 .82 .69 1 10
Acquired portfolios 1.00 .79 1.92 2.03 1.93 21 (93 )
Total delinquencies .80 .78 .90 .85 .74 2 6
 

(1) Excludes non-accrual loans and leases.

 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
NON-PERFORMING ASSET DATA
(Dollars in thousands)
(Unaudited)
             
At At At At At Change from
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Dec. 31,
2010 2010 2010 2010 2009 2010 2009

Non-Accrual Loans and Leases

Non-accrual loans and leases:
Consumer real estate
First mortgage lien $ 140,871 $ 140,315 $ 127,966 $ 125,997 $ 118,313 $ 556 $ 22,558
Junior lien   26,626     26,225     23,065     21,874     20,846     401     5,780  
Total consumer real estate 167,497 166,540 151,031 147,871 139,159 957 28,338
Consumer other   50     57     73     177     141     (7 )   (91 )
Total consumer real estate and other 167,547 166,597 151,104 148,048 139,300 950 28,247
Commercial real estate 104,305 120,252 105,782 75,293 77,627 (15,947 ) 26,678
Commercial business 37,943 41,637 23,484 27,075 28,569 (3,694 ) 9,374
Leasing and equipment finance 34,407 40,455 48,777 54,099 50,008 (6,048 ) (15,601 )
Inventory finance   1,055     871     1,035     886     771     184     284  
Total non-accrual loans and leases $ 345,257   $ 369,812   $ 330,182   $ 305,401   $ 296,275   $ (24,555 ) $ 48,982  
 
Non-accrual loans and leases - rollforward
Balance, beginning of period $ 369,812 $ 330,182 $ 305,401 $ 296,275 $ 268,834 $ 39,630 $ 100,978
Additions 92,180 143,929 125,270 84,212 128,054 (51,749 ) (35,874 )
Charge-offs (43,691 ) (35,986 ) (27,926 ) (23,510 ) (24,424 ) (7,705 ) (19,267 )
Transfers to other assets (42,094 ) (39,457 ) (36,936 ) (29,601 ) (44,114 ) (2,637 ) 2,020
Return to accrual status (17,989 ) (15,785 ) (12,593 ) (11,111 ) (15,283 ) (2,204 ) (2,706 )
Payments received (14,002 ) (15,653 ) (17,012 ) (12,671 ) (15,756 ) 1,651 1,754
Other, net   1,041     2,582     (6,022 )   1,807     (1,036 )   (1,541 )   2,077  
Balance, end of period $ 345,257   $ 369,812   $ 330,182   $ 305,401   $ 296,275   $ (24,555 ) $ 48,982  
 
Charge-offs and allowance recorded on
non-accrual loans and leases as a percentage
of contractual balance
Consumer real estate 22.0 % 20.7 % 21.8 % 20.5 % 19.3 % 130 bps 270

bps

Commercial 43.1 28.1 26.8 28.6 25.7 1,500 1,740
Leasing and equipment finance 24.3 28.6 32.0 28.7 29.9 (430 ) (560 )
Inventory finance 17.5 19.5 19.6 2.9 2.9 (200 ) 1,460
Total 31.6 24.7 25.0 24.6 23.2 690 840
 
 

Other Real Estate Owned

Other real estate owned:
Consumer real estate $ 90,115 $ 88,303 $ 81,895 $ 65,301 $ 66,956 $ 1,812 $ 23,159
Commercial real estate   50,950     47,841     36,036     36,135     38,812     3,109     12,138  
Total other real estate owned $ 141,065   $ 136,144   $ 117,931   $ 101,436   $ 105,768   $ 4,921   $ 35,297  
 
Ending number of properties owned
Consumer real estate 813 740 657 569 504 73 309
Commercial real estate   31     33     41     39     42     (2 )   (11 )
Total   844     773     698     608     546     71     298  
 
Other real estate owned - rollforward
Balance, beginning of period $ 136,144 $ 117,931 $ 101,436 $ 105,768 $ 94,167 $ 18,213 $ 41,977
Transferred in 44,948 41,506 37,369 28,209 46,325 3,442 (1,377 )
Sales (34,666 ) (18,674 ) (20,169 ) (25,171 ) (26,956 ) (15,992 ) (7,710 )
Writedowns (6,655 ) (3,779 ) (3,174 ) (4,068 ) (6,077 ) (2,876 ) (578 )
Other, net   1,294     (840 )   2,469     (3,302 )   (1,691 )   2,134     2,985  
Balance, end of period $ 141,065   $ 136,144   $ 117,931   $ 101,436   $ 105,768   $ 4,921   $ 35,297  
 
Charge-offs and writedowns recorded on other real
estate owned as a percentage of contractual
loan balance prior to non-performing status
Consumer 33.0 % 30.9 % 27.3 % 29.9 % 26.7 % 210 bps 630 bps
Commercial 26.6 30.9 34.6 34.2 27.8 (430 ) (120 )
Total 30.8 30.9 29.7 31.5 27.1 (10 ) 370
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
ALLOWANCE FOR LOAN AND LEASE LOSSES DATA
(Dollars in thousands)
(Unaudited)
                       

Allowance for Loan and Lease Losses

At December 31, 2010 At September 30, 2010 At December 31, 2009 Change from
Sep. 30, Dec. 31,
Balance % of Portfolio Balance % of Portfolio Balance % of Portfolio 2010 2009
Consumer real estate $ 172,850 2.42 % $ 169,743 2.35 % $ 164,966 2.27 % 7 bps 15 bps
Consumer other   1,653 4.22   2,069   4.74   2,476 4.82 (52 ) (60 )
Total consumer real estate and other 174,503 2.43 171,812 2.36 167,442 2.28 7 15
Commercial real estate 50,788 1.53 41,248 1.24 37,274 1.14 29 39
Commercial business 11,690 3.68 8,336 2.45 6,230 1.39 123 229
Leasing and equipment finance 26,301 .83 28,974 .92 32,063 1.04 (9 ) (21 )
Inventory finance   2,537 .32   2,750   .35   1,462 .31 (3 ) 1
Total $ 265,819 1.80 $ 253,120   1.70 $ 244,471 1.68 10 12
 
 

Credit Loss Reserves

At December 31, 2010 At September 30, 2010 At December 31, 2009 Change from
Sep. 30, Dec. 31,
Balance % of Portfolio Balance % of Portfolio Balance % of Portfolio 2010 2009
Allowance for loan and lease losses $ 265,819 1.80 % $ 253,120 1.70 % $ 244,471 1.68 % 10 bps 12 bps
Reserves for unfunded commitments   2,353 N.M.   2,696   N.M.   3,850 N.M. N.M. N.M.
Total $ 268,172 1.81 $ 255,816   1.72 $ 248,321 1.70 9 11
 
 

Net Charge-Offs

Change from
Quarter Ended Quarter Ended
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Dec. 31,
2010 2010 2010 2010 2009 2010 2009
Consumer real estate
First mortgage lien $ 23,206 $ 20,119 $ 16,775 $ 16,266 $ 16,646 $ 3,087 $ 6,560
Junior lien   13,450   14,374     12,672   12,996   14,757   (924 )   (1,307 )
Total consumer real estate 36,656 34,493 29,447 29,262 31,403 2,163 5,253
Consumer other   1,316   1,737     1,622   365   2,219   (421 )   (903 )
Total consumer real estate and other 37,972 36,230 31,069 29,627 33,622 1,742 4,350
Commercial real estate 17,295 12,962 8,181 6,521 5,585 4,333 11,710
Commercial business 1,301 (136 ) 962 1,316 1,674 1,437 (373 )
Leasing and equipment finance 7,814 8,674 7,514 6,643 7,681 (860 ) 133
Inventory finance   565   80     74   425   88   485     477  
Total $ 64,947 $ 57,810   $ 47,800 $ 44,532 $ 48,650 $ 7,137   $ 16,297  
 
 

Net Charge-Offs as a Percentage of Average Loans and Leases

Change from
Quarter Ended (1) Quarter Ended
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Dec. 31,
2010 2010 2010 2010 2009 2010 2009
Consumer real estate
First mortgage lien 1.88 % 1.63 % 1.36 % 1.32 % 1.34 % 25 bps 54 bps
Junior lien 2.37 2.50 2.20 2.25 2.54 (13 ) (17 )
Total consumer real estate 2.04 1.91 1.63 1.61 1.73 13 31
Consumer other N.M. N.M. N.M. N.M. N.M. - -
Total consumer real estate and other 2.10 2.00 1.71 1.63 1.84 10 26
Commercial real estate 2.08 1.56 .98 .80 .69 52 139
Commercial business 1.58 (.16 ) .97 1.23 1.51 174 7
Leasing and equipment finance .99 1.16 .99 .87 1.01 (17 ) (2 )
Inventory finance .28 .05 .04 .31 .09 23 19

Total

1.75 1.58 1.30 1.22 1.35 17 40
 
(1) Annualized.
N.M. Not meaningful.
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
             
Three Months Ended December 31,
2010 2009
Average Yields and Average Yields and
Balance Interest Rates (1) Balance Interest Rates (1)
ASSETS:
Investments and other $ 406,351 $ 1,900 1.86 % $ 176,487 $ 1,160 2.62 %
U.S. Government sponsored entities:
Mortgage-backed securities 1,729,928 18,005 4.16 1,497,672 17,707 4.73
Debentures - - - 413,647 2,310 2.23
U.S. Treasury Bills 198,895 63 .13 67,932 12 .07
Other securities   431   4 3.69   483   6 4.94
Total securities available for sale(2) 1,929,254 18,072 3.75 1,979,734 20,035 4.05
Loans and leases:
Consumer real estate:
Fixed-rate 4,874,633 74,961 6.10 5,360,601 84,542 6.26
Variable-rate 2,322,623 30,737 5.25 1,914,750 27,182 5.63
Consumer - other   23,283   537 9.15   32,676   703 8.54
Total consumer real estate and other 7,220,539 106,235 5.84 7,308,027 112,427 6.11
Commercial real estate:
Fixed- and adjustable-rate 2,826,395 42,063 5.90 2,708,597 41,408 6.07
Variable-rate   496,224   5,408 4.32   532,672   5,451 4.06
Total commercial real estate 3,322,619 47,471 5.67 3,241,269 46,859 5.74
Commercial business:
Fixed- and adjustable-rate 120,742 1,551 5.10 152,784 2,189 5.68
Variable-rate   207,545   1,787 3.42   290,229   2,846 3.89
Total commercial business 328,287 3,338 4.03 443,013 5,035 4.51
Leasing and equipment finance 3,155,472 49,174 6.23 3,049,093 50,494 6.62
Inventory finance   803,157   14,554 7.19   383,291   7,485 7.81
Total loans and leases 14,830,074 220,772 5.92 14,424,693 222,300 6.13
Total interest-earning assets   17,165,679   240,744 5.58   16,580,914   243,495 5.84
Other assets   1,443,876   1,194,053
Total assets $ 18,609,555 $ 17,774,967
 
 
LIABILITIES AND EQUITY:
 
Non-interest bearing deposits:
Retail $ 1,366,190 $ 1,355,543
Small business 676,670 611,454
Commercial and custodial   291,295   297,223
Total non-interest bearing deposits 2,334,155 2,264,220
Interest-bearing deposits:
Checking 2,044,060 1,475 .29 1,868,911 1,731 .37
Savings 5,392,650 8,592 .63 5,214,318 12,484 .95
Money market   643,801   1,043 .64   671,755   1,288 .76
Subtotal 8,080,511 11,110 .55 7,754,984 15,503 .79
Certificates of deposit   1,040,348   2,260 .86   1,366,871   5,668 1.64
Total interest-bearing deposits   9,120,859   13,370 .58   9,121,855   21,171 .92
Total deposits   11,455,014   13,370 .46   11,386,075   21,171 .74
Borrowings:
Short-term borrowings 235,219 209 .35 240,981 101 .17
Long-term borrowings   4,746,823   52,879 4.42   4,511,311   52,582 4.63
Total borrowings   4,982,042   53,088 4.23   4,752,292   52,683 4.40
Total interest-bearing liabilities   14,102,901   66,458 1.87   13,874,147   73,854 2.11
Total deposits and borrowings   16,437,056   66,458 1.61   16,138,367   73,854 1.82
Other liabilities   674,827   447,597
Total liabilities   17,111,883   16,585,964
Total TCF Financial Corp. stockholders' equity 1,490,342 1,184,947
Non-controlling interest in subsidiaries   7,330   4,056
Total equity   1,497,672   1,189,003
Total liabilities and equity $ 18,609,555 $ 17,774,967
Net interest income and margin $ 174,286 4.04 % $ 169,641 4.07 %
 
(1) Annualized.
(2) Average balances and yields of securities available for sale are based upon the historical amortized cost and excludes equity securities.
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
             
Year Ended December 31,
2010 2009
Average Yields and Average Yields and
Balance Interest Rates (1) Balance Interest Rates (1)
ASSETS:
Investments and other $ 337,279 $ 5,509 1.63 % $ 375,396 $ 4,370 1.16 %
U.S. Government sponsored entities:
Mortgage-backed securities 1,817,413 80,332 4.42 1,645,544 80,902 4.92
Debentures - - - 389,245 8,487 2.18
U.S. Treasury Bills 71,233 93 .13 17,123 12 .07
Other securities   454   20 4.41   494   26 5.26
Total securities available for sale(2) 1,889,100 80,445 4.26 2,052,406 89,427 4.36
Loans and leases:
Consumer real estate:
Fixed-rate 5,082,487 313,573 6.17 5,421,081 348,400 6.43
Variable-rate 2,148,171 116,437 5.42 1,862,267 106,988 5.75
Consumer - other   26,576   2,303 8.67   35,849   3,061 8.54
Total consumer real estate and other 7,257,234 432,313 5.96 7,319,197 458,449 6.26
Commercial real estate:
Fixed- and adjustable-rate 2,816,201 167,757 5.96 2,574,818 155,812 6.05
Variable-rate   495,433   21,559 4.35   561,881   22,544 4.01
Total commercial real estate 3,311,634 189,316 5.72 3,136,699 178,356 5.69
Commercial business:
Fixed- and adjustable-rate 140,498 7,447 5.30 166,745 9,581 5.75
Variable-rate   234,892   8,521 3.63   308,929   10,644 3.45
Total commercial business 375,390 15,968 4.25 475,674 20,225 4.25
Leasing and equipment finance 3,056,006 196,445 6.43 2,826,835 192,557 6.81
Inventory finance   677,214   49,881 7.37   179,990   14,797 8.22
Total loans and leases 14,677,478 883,923 6.02 13,938,395 864,384 6.20
Total interest-earning assets   16,903,857   969,877 5.74   16,366,197   958,181 5.85
Other assets   1,286,683   1,157,314
Total assets $ 18,190,540 $ 17,523,511
 
 
LIABILITIES AND EQUITY:
 
Non-interest bearing deposits:
Retail $ 1,429,436 $ 1,402,442
Small business 641,412 584,605
Commercial and custodial   284,750   265,681
Total non-interest bearing deposits 2,355,598 2,252,728
Interest-bearing deposits:
Checking 2,071,990 6,466 .31 1,802,694

8,137

.45
Savings 5,410,681 40,023 .74 4,732,316 58,556 1.24
Money market   656,691   4,532 .69   683,030   7,006 1.03
Subtotal 8,139,362 51,021 .63 7,218,040

73,699

1.02
Certificates of deposit   1,054,179   10,208 .97   1,915,467   48,413 2.53
Total interest-bearing deposits   9,193,541   61,229 .67   9,133,507  

122,112

1.34
Total deposits   11,549,139   61,229 .53   11,386,235  

122,112

1.07
Borrowings:
Short-term borrowings 124,891 474 .38 85,228 233 .27
Long-term borrowings   4,580,786   208,972 4.56   4,373,182  

202,830

4.64
Total borrowings   4,705,677   209,446 4.45   4,458,410  

203,063

4.55
Total interest-bearing liabilities   13,899,218   270,675 1.95   13,591,917   325,175 2.39
Total deposits and borrowings   16,254,816   270,675 1.66   15,844,645   325,175 2.05
Other liabilities   511,589   416,555
Total liabilities   16,766,405   16,261,200
Total TCF Financial Corp. stockholders' equity 1,415,161 1,261,219
Non-controlling interest in subsidiaries   8,974   1,092
Total equity   1,424,135   1,262,311
Total liabilities and equity $ 18,190,540 $ 17,523,511
Net interest income and margin $ 699,202 4.14 % $ 633,006 3.87 %
 
(1) Annualized.
(2) Average balances and yields of securities available for sale are based upon the historical amortized cost and excludes equity securities.
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY STATEMENTS OF INCOME AND FINANCIAL RATIOS
(Dollars in thousands, except per-share data)
(Unaudited)
         
At or For the Three Months Ended
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
2010 2010 2010 2010 2009
Interest income:
Loans and leases $ 220,772 $ 219,974 $ 221,913 $ 221,264 $ 222,300
Securities available for sale 18,072 19,901 21,065 21,407 20,035
Investments and other   1,900     1,232     1,236     1,141     1,160  
Total interest income   240,744     241,107     244,214     243,812     243,495  
Interest expense:
Deposits 13,370 13,974 16,281 17,604 21,171
Borrowings   53,088     53,378     51,434     51,546     52,683  
Total interest expense   66,458     67,352     67,715     69,150     73,854  
Net interest income 174,286 173,755 176,499 174,662 169,641
Provision for credit losses   77,646     59,287     49,013     50,491     77,389  
Net interest income after provision for
credit losses   96,640     114,468     127,486     124,171     92,252  
Non-interest income:
Fees and service charges 61,480 67,684 77,845 66,172 74,875
Card revenue 27,625 27,779 28,591 27,072 26,813
ATM revenue   6,985     7,985     7,844     7,022     7,006  
Subtotal 96,090 103,448 114,280 100,266 108,694
Leasing and equipment finance 23,402 24,912 20,528 20,352 24,408
Other   817     1,077     1,235     2,455     2,764  
Fees and other revenue 120,309 129,437 136,043 123,073 135,866
Gains (losses) on securities, net   21,185     8,505     (137 )   (430 )   7,283  
Total non-interest income   141,494     137,942     135,906     122,643     143,149  
Non-interest expense:
Compensation and employee benefits 87,371 90,282 86,983 88,225 89,374
Occupancy and equipment 30,968 32,091 31,311 32,181 31,099
FDIC insurance 7,398 5,486 5,219 5,481 5,288
Deposit account premiums 1,688 3,340 5,478 6,798 9,347
Advertising and marketing 3,154 3,354 3,734 2,820 3,789
Other   37,309     39,481     35,053     34,410     40,193  
Subtotal 167,888 174,034 167,778 169,915 179,090
Foreclosed real estate and repossessed assets, net 12,781 9,588 8,756 9,260 12,537
Operating lease depreciation 8,289 8,965 9,812 10,040 10,750
Other credit costs, net   1,542     (834 )   2,723     2,587     4,386  
Total non-interest expense   190,500     191,753     189,069     191,802     206,763  
Income before income tax expense 47,634 60,657 74,323 55,012 28,638
Income tax expense   16,011     22,852     28,112     20,790     9,385  
Income after income tax expense 31,623 37,805 46,211 34,222 19,253
Income (loss) attributable to non-controlling interest   898     912     1,186     301     (203 )
Net income available to common stockholders $ 30,725   $ 36,893   $ 45,025   $ 33,921   $ 19,456  
 
Net income per common share:
Basic $ .22 $ .26 $ .32 $ .26 $ .15
Diluted .22 .26 .32 .26 .15
 
Dividends declared per common share $ .05 $ .05 $ .05 $ .05 $ .05
 
 

Financial Ratios: (1)

 
Return on average assets .68 % .84 % 1.02 % .76 % .43 %
 
Return on average common equity 8.25 9.95 12.71 10.68 6.57
 
Net interest margin 4.04 4.12 4.18 4.20 4.07
 
(1) Annualized.
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY AVERAGE BALANCE SHEETS
(In thousands)
(Unaudited)
         
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
2010 2010 2010 2010 2009
ASSETS
Cash and due from banks $ 506,244 $ 420,674 $ 458,598 $ 388,969 $ 297,758
Investments 176,795 162,034 158,956 160,630 158,764
U.S. Government sponsored entities:
Mortgage-backed securities 1,907,958 1,767,410 1,860,233 1,885,076 1,497,672
Debentures - - - - 413,647
U.S. Treasury Bills 199,330 69,705 14,167 - 67,932
Other securities   2,945     3,473     4,358     5,105     540  
Total securities available for sale 2,110,233 1,840,588 1,878,758 1,890,181 1,979,791
Loans and leases:
Consumer real estate:
Fixed-rate 4,874,633 5,019,925 5,152,954 5,287,660 5,360,601
Variable-rate 2,322,623 2,213,091 2,081,247 1,971,145 1,914,750
Consumer - other   23,283     25,130     27,584     30,406     32,676  
Total consumer real estate and other 7,220,539 7,258,146 7,261,785 7,289,211 7,308,027
Commercial real estate:
Fixed- and adjustable-rate 2,826,395 2,830,748 2,824,233 2,782,787 2,708,597
Variable-rate   496,224     496,669     498,753     490,006     532,672  
Total commercial real estate 3,322,619 3,327,417 3,322,986 3,272,793 3,241,269
Commercial business:
Fixed- and adjustable-rate 120,742 125,206 152,488 164,204 152,784
Variable-rate   207,545     221,225     246,341     265,238     290,229  
Total commercial business 328,287 346,431 398,829 429,442 443,013
Leasing and equipment finance 3,155,472 3,002,714 3,021,532 3,043,664 3,049,093
Inventory finance   803,157     655,485     692,816     553,095     383,291  
Total loans and leases   14,830,074     14,590,193     14,697,948     14,588,205     14,424,693  
Allowance for loan and lease losses   (251,904 )   (251,603 )   (249,553 )   (245,154 )   (218,967 )
Net loans and leases 14,578,170 14,338,590 14,448,395 14,343,051 14,205,726
Premises and equipment, net 446,527 447,364 444,652 447,765 449,738
Goodwill 152,599 152,599 152,599 152,599 152,599
Other assets   638,987     672,573     592,381     605,355     530,591  
Total assets $ 18,609,555   $ 18,034,422   $ 18,134,339   $ 17,988,550   $ 17,774,967  
 
 
LIABILITIES AND EQUITY
 
Non-interest-bearing deposits:
Retail $ 1,366,190 $ 1,408,984 $ 1,480,896 $ 1,462,962 $ 1,355,543
Small business 676,670 659,165 631,495 597,249 611,454
Commercial and custodial   291,295     279,475     289,384     278,827     297,223  
Total non-interest bearing deposits 2,334,155 2,347,624 2,401,775 2,339,038 2,264,220
Interest-bearing deposits:
Checking 2,044,060 2,014,550 2,145,260 2,085,175 1,868,911
Savings 5,392,650 5,426,481 5,477,044 5,345,862 5,214,318
Money market   643,801     654,030     660,654     668,581     671,755  
Subtotal 8,080,511 8,095,061 8,282,958 8,099,618 7,754,984
Certificates of deposit   1,040,348     1,006,685     1,044,008     1,127,149     1,366,871  
Total interest-bearing deposits   9,120,859     9,101,746     9,326,966     9,226,767     9,121,855  
Total deposits   11,455,014     11,449,370     11,728,741     11,565,805     11,386,075  
Borrowings:
Short-term borrowings 235,219 40,646 26,665 197,319 240,981
Long-term borrowings   4,746,823     4,587,964     4,485,283     4,500,285     4,511,311  
Total borrowings 4,982,042 4,628,610 4,511,948 4,697,604 4,752,292
Accrued expenses and other liabilities   674,827     463,492     464,276     448,233     447,597  
Total liabilities   17,111,883     16,541,472     16,704,965     16,711,642     16,585,964  
Equity:
Preferred stock - - - - -
Common stock 1,428 1,426 1,425 1,353 1,304
Additional paid-in capital 456,760 451,570 451,942 360,517 302,209
Retained earnings, subject to certain restrictions 1,052,092 1,025,631 990,018 957,596 938,504
Accumulated other comprehensive income (loss) 3,089 28,861 3,854 (6,224 ) 1,040
Treasury stock at cost and other   (23,027 )   (23,923 )   (30,219 )   (43,185 )   (58,110 )
Total TCF Financial Corp. stockholders equity 1,490,342 1,483,565 1,417,020 1,270,057 1,184,947
Non-controlling interest in subsidiaries   7,330     9,385     12,354     6,851     4,056  
Total equity   1,497,672     1,492,950     1,429,374     1,276,908  

 

  1,189,003  
Total liabilities and equity $ 18,609,555   $ 18,034,422   $ 18,134,339   $ 17,988,550  

 

$ 17,774,967  
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY YIELDS AND RATES (1)
(Unaudited)
         
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
2010 2010 2010 2010 2009
 
ASSETS
 
Investments and other 1.86 % 1.59 % 1.40 % 1.64 % 2.62 %
U.S. Government sponsored entities:
Mortgage-backed securities 4.16 4.43 4.53 4.54 4.73
Debentures - - - - 2.23
U.S. Treasury Bills .13 .13 .21 - .07
Other securities .54 .57 .46 .47 4.42
Total securities available for sale 3.74 4.26 4.48 4.54 4.05
Loans and leases:
Consumer real estate:
Fixed-rate 6.10 6.16 6.16 6.25 6.26
Variable-rate 5.25 5.36 5.49 5.62 5.63
Consumer - other 9.15 8.92 8.23 8.47 8.54
Total consumer real estate and other 5.84 5.93 5.98 6.09 6.11
Commercial real estate:
Fixed- and adjustable-rate 5.90 5.90 5.96 6.06 6.07
Variable-rate 4.32 4.35 4.34 4.40 4.06
Total commercial real estate 5.67 5.67 5.72 5.81 5.74
Commercial business:
Fixed- and adjustable-rate 5.10 4.73 5.58 5.64 5.68
Variable-rate 3.42 3.48 3.80 3.76 3.89
Total commercial business 4.03 3.93 4.48 4.48 4.51
Leasing and equipment finance 6.23 6.40 6.51 6.57 6.62
Inventory finance 7.19 7.57 7.34 7.33 7.81
Total loans and leases 5.92 5.99 6.05 6.13 6.13
 
Total interest-earning assets 5.58 5.72 5.78 5.87 5.84
 
 
LIABILITIES
 
Interest-bearing deposits:
Checking .29 .29 .32 .35 .37
Savings .63 .66 .79 .87 .95
Money market .64 .65 .71 .76 .76
Subtotal .55 .57 .66 .73 .79
Certificates of deposit .86 .93 .99 1.08 1.64
Total interest-bearing deposits .58 .61 .70 .77 .92
Total deposits .46 .48 .56 .62 .74
Borrowings:
Short-term borrowings .35 .82 1.19 .21 .17
Long-term borrowings 4.42 4.61 4.59 4.63 4.63
Total borrowings 4.23 4.58 4.57 4.44 4.40
 
Total interest-bearing liabilities 1.87 1.95 1.96 2.01 2.11
 
 
Net interest margin 4.04 % 4.12 % 4.18 % 4.20 % 4.07 %
 
(1) Annualized.
 
 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (1)
(Dollars in thousands)
(Unaudited)
   
At Dec. 31, At Dec. 31,
2010 2009
Computation of total equity to total assets:
Total equity $ 1,480,163 $ 1,179,755
Total assets $ 18,465,025 $ 17,885,175
Total equity to total assets 8.02 % 6.60 %
 
Computation of tangible realized common equity to tangible assets:
Total equity $ 1,480,163 $ 1,179,755
Less: Non-controlling interest in subsidiaries   8,500     4,393  
Total TCF Financial Corp. stockholders’ equity 1,471,663 1,175,362
Less:
Goodwill 152,599 152,599
Other intangibles 1,232 1,405
Add:
Accumulated other comprehensive loss   31,514     18,545  
Tangible realized common equity $ 1,349,346   $ 1,039,903  
 
Total assets $ 18,465,025 $ 17,885,175
Less:
Goodwill 152,599 152,599
Other intangibles   1,232     1,405  
Tangible assets $ 18,311,194   $ 17,731,171  
 
Tangible realized common equity to tangible assets 7.37 % 5.86 %
 
 
At Dec. 31, At Dec. 31,
2010 2009
Computation of tier 1 risk-based capital ratio:
Total tier 1 capital $ 1,475,525 $ 1,161,750
Total risk-weighted assets $ 13,929,097 $ 13,627,871
Total tier 1 risk-based capital ratio 10.59 % 8.52 %
 
Computation of tier 1 common capital ratio:
Total tier 1 capital $ 1,475,525 $ 1,161,750
Less:
Qualifying trust preferred securities 115,000 115,000
Qualifying non-controlling interest in subsidiaries   8,500     4,393  
Total tier 1 common capital $ 1,352,025   $ 1,042,357  
 
Total tier 1 common capital ratio 9.71 % 7.65 %
 
(1) In contrast to GAAP-basis and regulatory capital-basis measures, tangible realized common equity excludes the effect of goodwill, other intangibles and accumulated other comprehensive income (loss) and the total tier 1 common capital ratio excludes the effect of qualifying trust preferred securities and qualifying non-controlling interest in subsidiaries. Management reviews these ratios as ongoing measures and has included this information because of current interest in the industry. The methodology for calculating these ratios may vary between companies.

Contacts

TCF Financial Corporation, Wayzata
Jason Korstange, 952-745-2755
www.tcfbank.com

Contacts

TCF Financial Corporation, Wayzata
Jason Korstange, 952-745-2755
www.tcfbank.com