TCF Financial Corporation (NYSE:TCB):
SECOND QUARTER HIGHLIGHTS
- Revenue of $310.1 million, up 2.7 percent from the second quarter of 2013
- Loan and lease originations of $3.5 billion, up 8.6 percent from the second quarter of 2013
- Average deposits of $14.8 billion, up 4.6 percent from the second quarter of 2013
- Provision for credit losses of $9.9 million, down 69.6 percent from the second quarter of 2013
- Non-accrual loans and leases of $260.3 million, down 6.5 percent from the second quarter of 2013
- Return on average assets of 1.17 percent, up 27 basis points from the second quarter of 2013
- Return on average tangible common equity of 12.72 percent, up 282 basis points from the second quarter of 2013
Summary of Financial Results | Table 1 | ||||||||||||||||||||||||||||
(Dollars in thousands, except per-share data) | Percent Change | ||||||||||||||||||||||||||||
2Q | 1Q | 2Q | 2Q14 vs | 2Q14 vs | YTD | YTD | Percent | ||||||||||||||||||||||
2014 | 2014 | 2013 | 1Q14 | 2Q13 | 2014 | 2013 | Change | ||||||||||||||||||||||
Net income attributable to TCF | $ | 53,125 | $ | 44,757 | $ | 38,904 | 18.7 | % | 36.6 | % | $ | 97,882 | $ | 68,878 | 42.1 | % | |||||||||||||
Net interest income | 206,101 | 201,274 | 202,044 | 2.4 | 2.0 | 407,375 | 401,135 | 1.6 | |||||||||||||||||||||
Diluted earnings per common share | .29 | .24 | .21 | 20.8 | 38.1 | .54 | .37 | 45.9 | |||||||||||||||||||||
Financial Ratios (1) | |||||||||||||||||||||||||||||
Pre-tax pre-provision return on average assets (2) | 2.05 | % | 1.88 | % | 2.04 | % | 1.96 | % | 1.98 | % | |||||||||||||||||||
Return on average assets | 1.17 | 1.00 | .90 | 1.09 | .80 | ||||||||||||||||||||||||
Return on average common equity | 10.99 | 9.35 | 8.39 | 10.18 | 7.39 | ||||||||||||||||||||||||
Return on average tangible common equity (3) | 12.72 | 10.89 | 9.90 | 11.82 | 8.76 | ||||||||||||||||||||||||
Net interest margin | 4.65 | 4.66 | 4.72 | 4.66 | 4.72 | ||||||||||||||||||||||||
Net charge-offs as a percentage of average loans and leases | .45 | .43 | .70 | .44 | .88 | ||||||||||||||||||||||||
(1) Annualized. | |||||||||||||||||||||||||||||
(2) Pre-tax pre-provision profit is calculated as total revenues less non-interest expense. | |||||||||||||||||||||||||||||
(3) See "Reconciliation of GAAP to Non-GAAP Financial Measures" table. | |||||||||||||||||||||||||||||
TCF Financial Corporation (“TCF” or the “Company”) (NYSE: TCB) today reported net income of $53.1 million for the second quarter of 2014, compared with net income of $38.9 million for the second quarter of 2013, and net income of $44.8 million for the first quarter of 2014. Diluted earnings per common share was 29 cents for the second quarter of 2014, compared with 21 cents for the second quarter of 2013, and 24 cents for the first quarter of 2014.
TCF reported net income of $97.9 million for the first six months of 2014, compared with net income of $68.9 million for the same period in 2013. Diluted earnings per common share was 54 cents for the first six months of 2014, compared with 37 cents for the same period in 2013.
Chairman’s Statement
“TCF’s financial metrics continued to improve in the second quarter,” said William A. Cooper, Chairman and Chief Executive Officer. “TCF earned 29 cents per common share during the quarter, up 38 percent from a year ago. Return on average assets was 1.17 percent while return on average tangible common equity was 12.72 percent.
“TCF experienced strong loan and lease originations and deposit growth. Our net interest margin was 4.65 percent, relatively flat with the first quarter of 2014. Fee income was strong and overall credit quality showed continued improvement. The efforts of our employees and the support from our Board of Directors have contributed to the transformation of the Company which is reflected in our current performance. TCF’s net income of $53.1 million during the quarter was the highest level since the fourth quarter of 2007.”
Revenue | |||||||||||||||||||||||||||||
Total Revenue | Table 2 | ||||||||||||||||||||||||||||
Percent Change | |||||||||||||||||||||||||||||
(Dollars in thousands) | 2Q | 1Q | 2Q | 2Q14 vs | 2Q14 vs | YTD | YTD | Percent | |||||||||||||||||||||
2014 | 2014 | 2013 | 1Q14 | 2Q13 | 2014 | 2013 | Change | ||||||||||||||||||||||
Net interest income | $ | 206,101 | $ | 201,274 | $ | 202,044 | 2.4 | % | 2.0 | % | $ | 407,375 | $ | 401,135 | 1.6 | % | |||||||||||||
Fees and other revenue: | |||||||||||||||||||||||||||||
Fees and service charges | 38,035 | 36,619 | 41,572 | 3.9 | (8.5) | 74,654 | 80,895 | (7.7) | |||||||||||||||||||||
Card revenue | 13,249 | 12,250 | 13,270 | 8.2 | (.2) | 25,499 | 25,687 | (.7) | |||||||||||||||||||||
ATM revenue | 5,794 | 5,319 | 5,828 | 8.9 | (.6) | 11,113 | 11,333 | (1.9) | |||||||||||||||||||||
Total banking fees | 57,078 | 54,188 | 60,670 | 5.3 | (5.9) | 111,266 | 117,915 | (5.6) | |||||||||||||||||||||
Leasing and equipment finance | 23,069 | 21,980 | 22,609 | 5.0 | 2.0 | 45,049 | 38,813 | 16.1 | |||||||||||||||||||||
Gains on sales of auto loans, net | 7,270 | 8,470 | 8,135 | (14.2) | (10.6) | 15,740 | 15,281 | 3.0 | |||||||||||||||||||||
Gains on sales of consumer real estate loans, net | 8,151 | 11,706 | 4,069 | (30.4) | 100.3 | 19,857 | 12,195 | 62.8 | |||||||||||||||||||||
Servicing fee income | 4,892 | 4,307 | 3,128 | 13.6 | 56.4 | 9,199 | 5,884 | 56.3 | |||||||||||||||||||||
Other | 2,789 | 2,382 | 1,172 | 17.1 | 138.0 | 5,171 | 2,398 | 115.6 | |||||||||||||||||||||
Total fees and other revenue | 103,249 | 103,033 | 99,783 | .2 | 3.5 | 206,282 | 192,486 | 7.2 | |||||||||||||||||||||
Subtotal | 309,350 | 304,307 | 301,827 | 1.7 | 2.5 | 613,657 | 593,621 | 3.4 | |||||||||||||||||||||
Gains on securities, net | 767 | 374 | - | 105.1 | N.M. | 1,141 | - | N.M. | |||||||||||||||||||||
Total revenue | $ | 310,117 | $ | 304,681 | $ | 301,827 | 1.8 | 2.7 | $ | 614,798 | $ | 593,621 | 3.6 | ||||||||||||||||
Net interest margin (1) | 4.65 | % | 4.66 | % | 4.72 | % | 4.66 | % | 4.72 | % | |||||||||||||||||||
Fees and other revenue as a % of total revenue | 33.29 | 33.82 | 33.06 | 33.55 | 32.43 | ||||||||||||||||||||||||
N.M. Not meaningful. | |||||||||||||||||||||||||||||
(1) Annualized. |
Net Interest Income
- Net interest income for the second quarter of 2014 increased $4.1 million, or 2 percent, compared with the second quarter of 2013. The increase from the second quarter of 2013 was driven by higher average loan and lease balances in the auto finance, inventory finance and leasing and equipment finance businesses as well as a reduced cost of borrowings. This increase was partially offset by downward pressure on yields across the lending businesses in this increasingly competitive low interest rate environment as well as lower average balances of consumer real estate and higher yielding commercial fixed-rate loans due to run-off exceeding originations.
- Net interest income for the second quarter of 2014 increased $4.8 million, or 2.4 percent, compared with first quarter of 2014. The increase was primarily due to higher average loan balances in the auto finance portfolio due to continued growth and in the inventory finance portfolio due to seasonality. The increase was partially offset by reduced interest income from lower average balances of consumer real estate loans.
- Net interest margin in the second quarter of 2014 was 4.65 percent, compared with 4.72 percent in the second quarter of 2013 and remained relatively flat compared to the first quarter of 2014. The decrease from the second quarter of 2013 was primarily due to downward pressure on origination yields in consumer real estate due to the increasingly competitive low interest rate environment as well as a shift in commercial real estate from higher yielding fixed-rate loans to lower yielding variable-rate loans due to marketplace demand.
Non-interest Income
- Fees and service charges in the second quarter of 2014 were $38 million, down $3.5 million, or 8.5 percent, from the second quarter of 2013 and up $1.4 million, or 3.9 percent, from the first quarter of 2014. The decrease from the second quarter of 2013 was primarily due to customer behavior changes, as well as higher average checking account balances per customer. The increase from the first quarter of 2014 was primarily due to seasonality resulting in an increase in transaction activity and a decrease in average checking account balances per customer.
- Leasing and equipment finance revenue was $23.1 million during the second quarter of 2014, up $460 thousand, or 2 percent, from the second quarter of 2013 and up $1.1 million, or 5 percent, from the first quarter of 2014. The increases in both periods were primarily due to customer-driven events impacting sales-type lease revenue.
- TCF sold $224.2 million, $139.2 million and $347.4 million of consumer real estate loans during the second quarters of 2014 and 2013, and the first quarter of 2014, respectively, resulting in net gains in the same respective periods.
- TCF sold $220.2 million, $196.9 million and $261.7 million of auto loans during the second quarters of 2014 and 2013, and the first quarter of 2014, respectively, resulting in net gains in the same respective periods.
- Servicing fee income was $4.9 million on $2.6 billion of loans and leases serviced for others during the second quarter of 2014 compared to $3.1 million on $ 1.6 billion of loans and leases serviced for others during the second quarter of 2013 and $4.3 million on $2.4 billion of loans and leases serviced for others during the first quarter of 2014. The increases in servicing fee income in both periods were primarily due to an increase in consumer real estate and auto finance loans serviced for others.
Loans and Leases | ||||||||||||||||||||||||
Period-End and Average Loans and Leases | Table 3 | |||||||||||||||||||||||
Percent Change | ||||||||||||||||||||||||
(Dollars in thousands) | 2Q | 1Q | 2Q | 2Q14 vs | 2Q14 vs | YTD | YTD | Percent | ||||||||||||||||
2014 | 2014 | 2013 | 1Q14 | 2Q13 | 2014 | 2013 | Change | |||||||||||||||||
Period-End: | ||||||||||||||||||||||||
Consumer real estate: | ||||||||||||||||||||||||
First mortgage lien | $ | 3,542,324 | $ | 3,668,245 | $ | 3,982,481 | (3.4) | % | (11.1) | % | ||||||||||||||
Junior lien | 2,480,763 | 2,407,286 | 2,373,945 | 3.1 | 4.5 | |||||||||||||||||||
Total consumer real estate | 6,023,087 | 6,075,531 | 6,356,426 | (.9) | (5.2) | |||||||||||||||||||
Commercial | 3,093,161 | 3,136,421 | 3,350,334 | (1.4) | (7.7) | |||||||||||||||||||
Leasing and equipment finance | 3,526,264 | 3,456,759 | 3,251,703 | 2.0 | 8.4 | |||||||||||||||||||
Inventory finance | 1,880,667 | 2,123,808 | 1,713,528 | (11.4) | 9.8 | |||||||||||||||||||
Auto finance | 1,502,860 | 1,400,527 | 882,202 | 7.3 | 70.4 | |||||||||||||||||||
Other | 24,486 | 22,550 | 25,099 | 8.6 | (2.4) | |||||||||||||||||||
Total | $ | 16,050,525 | $ | 16,215,596 | $ | 15,579,292 | (1.0) | 3.0 | ||||||||||||||||
Average: | ||||||||||||||||||||||||
Consumer real estate: | ||||||||||||||||||||||||
First mortgage lien | $ | 3,606,635 | $ | 3,719,961 | $ | 4,068,020 | (3.0) | % | (11.3) | % | $ | 3,662,985 | $ | 4,127,209 | (11.2) | % | ||||||||
Junior lien | 2,498,151 | 2,607,851 | 2,362,665 | (4.2) | 5.7 | 2,552,698 | 2,365,999 | 7.9 | ||||||||||||||||
Total consumer real estate | 6,104,786 | 6,327,812 | 6,430,685 | (3.5) | (5.1) | 6,215,683 | 6,493,208 | (4.3) | ||||||||||||||||
Commercial | 3,131,320 | 3,122,066 | 3,336,406 | .3 | (6.1) | 3,126,718 | 3,341,067 | (6.4) | ||||||||||||||||
Leasing and equipment finance | 3,500,647 | 3,434,691 | 3,236,799 | 1.9 | 8.2 | 3,467,851 | 3,218,252 | 7.8 | ||||||||||||||||
Inventory finance | 2,061,437 | 1,862,745 | 1,875,810 | 10.7 | 9.9 | 1,968,431 | 1,780,058 | 10.6 | ||||||||||||||||
Auto finance | 1,518,194 | 1,327,232 | 823,102 | 14.4 | 84.4 | 1,423,240 | 747,022 | 90.5 | ||||||||||||||||
Other | 12,040 | 13,273 | 13,060 | (9.3) | (7.8) | 12,654 | 13,348 | (5.2) | ||||||||||||||||
Total | $ | 16,328,424 | $ | 16,087,819 | $ | 15,715,862 | 1.5 | 3.9 | $ | 16,214,577 | $ | 15,592,955 | 4.0 |
- Loans and leases were $16.1 billion at June 30, 2014, an increase of $471.2 million, or 3 percent, compared with June 30, 2013 and a decrease of $165.1 million, or 1 percent, compared with March 31, 2014. Average loans and leases were $16.3 billion for the second quarter of 2014, an increase of $612.6 million, or 3.9 percent, compared with the second quarter of 2013 and an increase of $240.6 million, or 1.5 percent, compared with the first quarter of 2014.
The increase from the second quarter of 2013 for period-end loans and leases and the increase from both periods for average loans and leases were primarily due to the continued growth of the auto finance portfolio as TCF expands the number of active dealers and sales force in its network and further penetrates existing territories, as well as an increase in the leasing and equipment finance portfolio. These increases were partially offset by a decrease in commercial real estate loans, primarily due to run-off exceeding new originations, as well as a decrease in total consumer real estate loans driven by run-off in the first mortgage real estate business and on-going loan sales.
The decrease from the first quarter of 2014 for period-end loans and leases was primarily due to seasonality within the inventory finance business, partially offset by the continued growth of the auto finance portfolio, coupled with assets moved to held for sale at the end of the quarter in anticipation of executing the Company’s inaugural auto loan securitization.
- Loan and lease originations were $3.5 billion for the second quarter of 2014, an increase of $273.8 million, or 8.6 percent, compared with the second quarter of 2013 and an increase of $311.2 million, or 9.9 percent, compared with the first quarter of 2014. The increase from the second quarter of 2013 was primarily due to the continued growth in auto finance and an increase in inventory finance and leasing and equipment finance originations as a result of an improving economic environment, partially offset by a decrease in commercial originations. The increase from the first quarter of 2014 was primarily due to an increase in consumer real estate, auto finance and leasing and equipment finance originations, partially offset by seasonality within the inventory finance business.
Credit Quality
(Table 4 - Credit Trends: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50911437&lang=en)
- Non-accrual loans and leases and other real estate owned totaled $325.4 million at June 30, 2014, a decrease of $19.3 million, or 5.6 percent, from June 30, 2013, and a decrease of $4.8 million, or 1.4 percent, from March 31, 2014. The decrease from June 30, 2013 was primarily due to improving credit quality trends and continued efforts to actively work out problem loans in the commercial portfolio, partially offset by $48.6 million of delinquent loans being transferred to non-accrual status due to a change in the non-accrual policy for consumer real estate loans during the third quarter of 2013. The decrease from March 31, 2014 was driven by improved credit quality in the consumer real estate and commercial portfolios.
- The over 60-day delinquency rate, excluding acquired portfolios and non-accrual loans and leases, was .18 percent at June 30, 2014, down from .52 percent at June 30, 2013, and down slightly from .19 percent at March 31, 2014. The decrease from June 30, 2013 was primarily a result of reduced over 60-day delinquencies in the consumer real estate portfolio due to a change in the non-accrual policy for consumer real estate loans during the third quarter of 2013, which increased non-accrual loans and leases, along with stabilization of our consumer real estate portfolio as property values improved in our markets.
- Net charge-offs were $18.4 million for the second quarter of 2014, a decrease of $9.3 million, or 33.7 percent, from the second quarter of 2013, and an increase of $939 thousand, or 5.4 percent, from the first quarter of 2014. The decrease from the second quarter of 2013 was primarily due to improved credit quality in the consumer real estate portfolio as home values improved and incident rates of default declined. The increase from the first quarter of 2014 was driven by one previously reserved commercial loan charge-off. Consumer real estate net charge-offs decreased for the seventh consecutive quarter.
- Provision for credit losses was $9.9 million for the second quarter of 2014, a decrease of $22.7 million, or 69.6 percent, from the second quarter of 2013, and a decrease of $4.6 million, or 31.6 percent, from the first quarter of 2014. The decrease from the second quarter of 2013 was primarily due to decreased net charge-offs in the consumer real estate portfolio resulting from improved home values and a reduction in incidents of default. The decrease from the first quarter of 2014 was due to reduced reserve requirements in the commercial and consumer real estate portfolios as credit quality in those portfolios improved.
Deposits | ||||||||||||||||||||||||
Average Deposits | Table 5 | |||||||||||||||||||||||
Percent Change | ||||||||||||||||||||||||
(Dollars in thousands) | 2Q | 1Q | 2Q | 2Q14 vs | 2Q14 vs | YTD | YTD | Percent | ||||||||||||||||
2014 | 2014 | 2013 | 1Q14 | 2Q13 | 2014 | 2013 | Change | |||||||||||||||||
Checking | $ | 5,098,650 | $ | 5,016,118 | $ | 4,884,433 | 1.6 | % | 4.4 | % | $ | 5,057,612 | $ | 4,834,964 | 4.6 | % | ||||||||
Savings | 5,908,219 | 6,142,950 | 6,082,200 | (3.8) | (2.9) | 6,024,936 | 6,098,121 | (1.2) | ||||||||||||||||
Money market | 1,019,543 | 819,312 | 791,859 | 24.4 | 28.8 | 919,981 | 803,551 | 14.5 | ||||||||||||||||
Subtotal | 12,026,412 | 11,978,380 | 11,758,492 | .4 | 2.3 | 12,002,529 | 11,736,636 | 2.3 | ||||||||||||||||
Certificates of deposit | 2,742,832 | 2,543,345 | 2,360,881 | 7.8 | 16.2 | 2,643,639 | 2,342,178 | 12.9 | ||||||||||||||||
Total average deposits | $ | 14,769,244 | $ | 14,521,725 | $ | 14,119,373 | 1.7 | 4.6 | $ | 14,646,168 | $ | 14,078,814 | 4.0 | |||||||||||
Average interest rate on deposits (1) | .24% | .22% | .25% | .23% | .27% | |||||||||||||||||||
(1) Annualized. |
- Total average deposits for the second quarter of 2014 increased $649.9 million, or 4.6 percent, from the second quarter of 2013 and increased $247.5 million, or 1.7 percent, from the first quarter of 2014. The increase from the second quarter of 2013 was primarily due to special campaigns for certificates of deposit and money market accounts, as well as higher average checking account balances per customer. The increase from the first quarter of 2014 was primarily due to special campaigns for certificates of deposit and money market accounts, partially offset by a reduction in savings.
- The average interest rate on deposits for the second quarter of 2014 was .24 percent, down one basis point from the second quarter of 2013 and up two basis points from the first quarter of 2014. The decrease from the second quarter of 2013 was primarily due to a reduction in average interest rates on various certificates of deposit, checking, and savings, partially offset by increased average interest rates on various money market accounts. The increase from the first quarter of 2014 was primarily due to increased average interest rates on various money market accounts and certificates of deposit.
Non-interest Expense | ||||||||||||||||||||||||
Non-interest Expense | Table 6 | |||||||||||||||||||||||
Percent Change | ||||||||||||||||||||||||
(Dollars in thousands) | 2Q | 1Q | 2Q | 2Q14 vs | 2Q14 vs | YTD | YTD | Percent | ||||||||||||||||
2014 | 2014 | 2013 | 1Q14 | 2Q13 | 2014 | 2013 | Change | |||||||||||||||||
Compensation and employee benefits | $ | 109,664 | $ | 115,089 | $ | 105,537 | (4.7) | % | 3.9 | % | $ | 224,753 | $ | 209,766 | 7.1 | % | ||||||||
Occupancy and equipment | 34,316 | 34,839 | 33,062 | (1.5) | 3.8 | 69,155 | 65,937 | 4.9 | ||||||||||||||||
FDIC insurance | 7,625 | 7,563 | 8,362 | .8 | (8.8) | 15,188 | 16,072 | (5.5) | ||||||||||||||||
Operating lease depreciation | 6,613 | 6,227 | 6,150 | 6.2 | 7.5 | 12,840 | 11,785 | 9.0 | ||||||||||||||||
Advertising and marketing | 5,862 | 5,478 | 5,532 | 7.0 | 6.0 | 11,340 | 11,264 | .7 | ||||||||||||||||
Deposit account premiums | 383 | 418 | 600 | (8.4) | (36.2) | 801 | 1,202 | (33.4) | ||||||||||||||||
Other | 42,618 | 41,335 | 41,946 | 3.1 | 1.6 | 83,953 | 79,885 | 5.1 | ||||||||||||||||
Subtotal | 207,081 | 210,949 | 201,189 | (1.8) | 2.9 | 418,030 | 395,911 | 5.6 | ||||||||||||||||
Foreclosed real estate and repossessed assets, net | 5,743 | 6,068 | 7,555 | (5.4) | (24.0) | 11,811 | 17,722 | (33.4) | ||||||||||||||||
Other credit costs, net | 371 | 119 | (228) | N.M. | N.M. | 490 | (1,065) | N.M. | ||||||||||||||||
Total non-interest expense | $ | 213,195 | $ | 217,136 | $ | 208,516 | (1.8) | 2.2 | $ | 430,331 | $ | 412,568 | 4.3 | |||||||||||
N.M. Not meaningful. |
- Compensation and employee benefits expense increased $4.1 million, or 3.9 percent, from the second quarter of 2013 and decreased $5.4 million, or 4.7 percent, from the first quarter of 2014. The increase from the second quarter of 2013 was primarily due to increased staff levels to support the growth of auto finance and risk management. The decrease from the first quarter of 2014 was due to the seasonality of payroll taxes and the reduction in personnel expense related to the branch realignment completed during the first quarter of 2014.
- Foreclosed real estate and repossessed assets expense decreased $1.8 million, or 24 percent, from the second quarter of 2013 and decreased $325 thousand, or 5.4 percent compared to the first quarter of 2014. The decreases from both periods were driven by a reduction in write-downs of existing foreclosed properties as a result of improved property values, and improved exit values on commercial properties.
Capital | ||||||||||||||
Capital Information | Table 7 | |||||||||||||
At period end | ||||||||||||||
(Dollars in thousands, except per-share data) | 2Q | 4Q | ||||||||||||
2014 | 2013 | |||||||||||||
Total equity | $ | 2,071,711 | $ | 1,964,759 | ||||||||||
Book value per common share | $ | 10.74 | $ | 10.23 | ||||||||||
Tangible book value per common share (1) | $ | 9.35 | $ | 8.83 | ||||||||||
Tangible common equity to tangible assets (1) | 8.39 | % | 8.03 | % | ||||||||||
Capital accumulation rate (2) | 12.17 | % | 9.72 | % | ||||||||||
Risk-based capital (3) | ||||||||||||||
Tier 1 | $ | 1,859,271 | 11.56 | % | $ | 1,763,682 | 11.41 | % | ||||||
Total | 2,185,783 | 13.59 | 2,107,981 | 13.64 | ||||||||||
Tier 1 leverage capital | $ | 1,859,271 | 9.91 | % | $ | 1,763,682 | 9.71 | % | ||||||
Tier 1 common capital (4) | $ | 1,579,226 | 9.82 | % | $ | 1,488,651 | 9.63 | % | ||||||
(1) Excludes the impact of preferred shares, goodwill and other intangibles (see “Reconciliation of GAAP to Non-GAAP Financial Measures” table). | ||||||||||||||
(2) Calculated as the change in annualized year to date Tier 1 common capital as a percentage of prior period Tier 1 common capital. | ||||||||||||||
(3) The Company's capital ratios continue to be in excess of "well-capitalized" regulatory benchmarks. | ||||||||||||||
(4) Excludes the effect of preferred shares and qualifying non-controlling interest in subsidiaries (see “Reconciliation of GAAP to Non-GAAP Financial Measures” table). |
- Capital ratios continue to improve as the Company accumulates capital through earnings. Total risk-based capital decreased slightly as the Company grows its risk-based assets.
- On July 21, 2014, TCF’s Board of Directors declared a regular quarterly cash dividend of 5 cents per common share, payable on September 2, 2014, to stockholders of record at the close of business on August 15, 2014. TCF also declared dividends on the 7.50% Series A and 6.45% Series B Non-Cumulative Perpetual Preferred Stock, both payable on September 2, 2014, to stockholders of record at the close of business on August 15, 2014.
Webcast Information
A live webcast of TCF’s conference call to discuss the second quarter earnings will be hosted at TCF’s website, http://ir.tcfbank.com, on July 25, 2014 at 8:00 a.m. CDT. A slide presentation for the call will be available on the website prior to the call. Additionally, the webcast will be 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, investor presentations and SEC filings.
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TCF is a Wayzata, Minnesota-based national bank holding company. As of June 30, 2014, TCF had $18.8 billion in total assets and 380 branches in Minnesota, Illinois, Michigan, Colorado, Wisconsin, Indiana, Arizona and South Dakota, providing retail and commercial banking services. TCF, through its subsidiaries, also conducts commercial leasing, equipment finance, and auto finance business in all 50 states and commercial inventory finance business in the U.S. and Canada. For more information about TCF, please visit http://ir.tcfbank.com.
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Cautionary Statements for Purposes of the Safe Harbor Provisions of the Securities Litigation Reform Act
Any statements contained in this earnings release regarding the outlook for the Company’s businesses and their respective markets, such as projections of future performance, guidance, statements of the Company’s plans and objectives, forecasts of market trends and other matters, are forward-looking statements based on the Company’s assumptions and beliefs. Such statements may be identified by such words or phrases as “will likely result,” “are expected to,” “will continue,” “outlook,” “will benefit,” “is anticipated,” “estimate,” “project,” “management believes” or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those discussed in such statements and no assurance can be given that the results in any forward-looking statement will be achieved. For these statements, TCF claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Any forward-looking statement speaks only as of the date on which it is made, and we disclaim any obligation to subsequently revise any forward-looking statement to reflect events or circumstances after such date or to reflect the occurrence of anticipated or unanticipated events.
Certain factors could cause the Company’s future results to differ materially from those expressed or implied in any forward-looking statements contained herein. These factors include the factors discussed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, under the heading “Risk Factors,” the factors discussed below and any other cautionary statements, written or oral, which may be made or referred to in connection with any such forward-looking statements. Since it is not possible to foresee all such factors, these factors should not be considered as complete or exhaustive.
Adverse Economic or Business Conditions; Competitive Conditions; Credit and Other Risks. Deterioration in general economic and banking industry conditions, including those arising from government shutdowns, defaults, anticipated defaults or rating agency downgrades of sovereign debt (including debt of the U.S.), or continued high rates of or increases in unemployment in TCF’s primary banking markets; adverse economic, business and competitive developments such as shrinking interest margins, reduced demand for financial services and loan and lease products, deposit outflows, deposit account attrition or an inability to increase the number of deposit accounts; customers completing financial transactions without using a bank; adverse changes in credit quality and other risks posed by TCF’s loan, lease, investment and securities available for sale portfolios, including declines in commercial or residential real estate values, changes in the allowance for loan and lease losses dictated by new market conditions or regulatory requirements, or the inability of home equity line borrowers to make increased payments caused by increased interest rates or amortization of principal; deviations from estimates of prepayment rates and fluctuations in interest rates that result in decreases in value of assets such as interest-only strips that arise in connection with TCF’s loan sales activity; 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; foreign currency exchange risks; counterparty risk, including the risk of defaults by our counterparties or diminished availability of counterparties who satisfy our credit quality requirements; decreases in demand for the types of equipment that TCF leases or finances; the effect of any negative publicity.
Legislative and Regulatory Requirements.New consumer protection and supervisory requirements and regulations, including those resulting from action by the Consumer Financial Protection Bureau and changes in the scope of Federal preemption of state laws that could be applied to national banks and their subsidiaries; the imposition of requirements that adversely impact TCF’s deposit, lending, loan collection and other business activities as a result of the Dodd-Frank Act, or other legislative or regulatory developments such as mortgage foreclosure moratorium laws, regulation of campus banking programs between colleges or universities and financial institutions, use by municipalities of eminent domain on underwater mortgages, or imposition of underwriting or other limitations that impact the ability to use certain variable-rate products; changes affecting customer account charges and fee income, including changes to interchange rates; changes to bankruptcy laws which would result in the loss of all or part of TCF’s security interest due to collateral value declines; deficiencies in TCF’s compliance under the Bank Secrecy Act in past or future periods, which may result in regulatory enforcement action including monetary penalties; increased health care costs resulting from Federal health care reform legislation; regulatory criticism and resulting enforcement actions or other adverse consequences such as increased capital requirements, higher deposit insurance assessments or monetary damages or penalties; heightened regulatory practices, requirements or expectations, including, but not limited to, requirements related to the Bank Secrecy Act and anti-money laundering compliance activity.
Earnings/Capital Risks and Constraints, Liquidity Risks. Limitations on TCF’s ability to pay dividends or to increase dividends 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 Act and other regulatory reform legislation; the impact of financial regulatory reform, including additional capital, leverage, liquidity and risk management requirements or changes in the composition of qualifying regulatory capital (including those resulting from U.S. implementation of Basel III requirements); 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; regulatory actions or changes in customer opt-in preferences with respect to overdraft, which may have an adverse impact on TCF’s fee revenue; uncertainties relating to future retail deposit account changes, including limitations on TCF’s ability to predict customer behavior and the impact on TCF’s fee revenues.
Branching Risk; Growth Risks. Adverse developments affecting TCF’s supermarket banking relationships or any of the supermarket chains in which TCF maintains supermarket branches; costs related to closing underperforming branches; slower than anticipated growth in existing or acquired businesses; inability to successfully execute on TCF’s growth strategy through acquisitions or cross-selling opportunities; failure to expand or diversify TCF’s balance sheet through programs or new opportunities; failure to successfully attract and retain new customers, including the failure to attract and retain manufacturers and dealers to expand the inventory finance business; failure to effectuate, and risks of claims related to, sales and securitizations of loans; risks related to new product additions and addition of distribution channels (or entry into new markets) for existing products.
Technological and Operational Matters. Technological or operational difficulties, loss or theft of information, cyber-attacks and other security breaches, counterparty failures and the possibility that deposit account losses (fraudulent checks, etc.) may increase; failure to keep pace with technological change.
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; the effect of interchange rate litigation against the Federal Reserve on debit card interchange fees; and possible increases in indemnification obligations for certain litigation against Visa U.S.A. and potential reductions in card revenues resulting from such litigation or other litigation against Visa.
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; ineffective internal controls; adverse federal, state or foreign tax assessments or findings in tax audits; lack of or inadequate insurance coverage for claims against TCF; potential for claims and legal action related to TCF’s fiduciary responsibilities.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | ||||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||
(Dollars in thousands, except per-share data) | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Three Months Ended June 30, | Change | |||||||||||||||||
2014 | 2013 | $ | % | |||||||||||||||
Interest income: | ||||||||||||||||||
Loans and leases | $ | 206,788 | $ | 206,675 | $ | 113 | .1 | % | ||||||||||
Securities available for sale | 2,805 | 4,637 | (1,832 | ) | (39.5 | ) | ||||||||||||
Securities held to maturity | 1,443 | 62 | 1,381 | N.M. | ||||||||||||||
Investments and other | 9,055 | 6,234 | 2,821 | 45.3 | ||||||||||||||
Total interest income | 220,091 | 217,608 | 2,483 | 1.1 | ||||||||||||||
Interest expense: | ||||||||||||||||||
Deposits | 8,877 | 8,851 | 26 | .3 | ||||||||||||||
Borrowings | 5,113 | 6,713 | (1,600 | ) | (23.8 | ) | ||||||||||||
Total interest expense | 13,990 | 15,564 | (1,574 | ) | (10.1 | ) | ||||||||||||
Net interest income | 206,101 | 202,044 | 4,057 | 2.0 | ||||||||||||||
Provision for credit losses | 9,909 | 32,591 | (22,682 | ) | (69.6 | ) | ||||||||||||
Net interest income after provision for credit losses | 196,192 | 169,453 | 26,739 | 15.8 | ||||||||||||||
Non-interest income: | ||||||||||||||||||
Fees and service charges | 38,035 | 41,572 | (3,537 | ) | (8.5 | ) | ||||||||||||
Card revenue | 13,249 | 13,270 | (21 | ) | (.2 | ) | ||||||||||||
ATM revenue | 5,794 | 5,828 | (34 | ) | (.6 | ) | ||||||||||||
Subtotal | 57,078 | 60,670 | (3,592 | ) | (5.9 | ) | ||||||||||||
Leasing and equipment finance | 23,069 | 22,609 | 460 | 2.0 | ||||||||||||||
Gains on sales of auto loans, net | 7,270 | 8,135 | (865 | ) | (10.6 | ) | ||||||||||||
Gains on sales of consumer real estate loans, net | 8,151 | 4,069 | 4,082 | 100.3 | ||||||||||||||
Servicing fee income | 4,892 | 3,128 | 1,764 | 56.4 | ||||||||||||||
Other | 2,789 | 1,172 | 1,617 | 138.0 | ||||||||||||||
Fees and other revenue | 103,249 | 99,783 | 3,466 | 3.5 | ||||||||||||||
Gains on securities, net | 767 | - | 767 | N.M. | ||||||||||||||
Total non-interest income | 104,016 | 99,783 | 4,233 | 4.2 | ||||||||||||||
Non-interest expense: | ||||||||||||||||||
Compensation and employee benefits | 109,664 | 105,537 | 4,127 | 3.9 | ||||||||||||||
Occupancy and equipment | 34,316 | 33,062 | 1,254 | 3.8 | ||||||||||||||
FDIC insurance | 7,625 | 8,362 | (737 | ) | (8.8 | ) | ||||||||||||
Operating lease depreciation | 6,613 | 6,150 | 463 | 7.5 | ||||||||||||||
Advertising and marketing | 5,862 | 5,532 | 330 | 6.0 | ||||||||||||||
Deposit account premiums | 383 | 600 | (217 | ) | (36.2 | ) | ||||||||||||
Other | 42,618 | 41,946 | 672 | 1.6 | ||||||||||||||
Subtotal | 207,081 | 201,189 | 5,892 | 2.9 | ||||||||||||||
Foreclosed real estate and repossessed assets, net | 5,743 | 7,555 | (1,812 | ) | (24.0 | ) | ||||||||||||
Other credit costs, net | 371 | (228 | ) | 599 | N.M. | |||||||||||||
Total non-interest expense | 213,195 | 208,516 | 4,679 | 2.2 | ||||||||||||||
Income before income tax expense | 87,013 | 60,720 | 26,293 | 43.3 | ||||||||||||||
Income tax expense | 31,385 | 19,444 | 11,941 | 61.4 | ||||||||||||||
Income after income tax expense | 55,628 | 41,276 | 14,352 | 34.8 | ||||||||||||||
Income attributable to non-controlling interest | 2,503 | 2,372 | 131 | 5.5 | ||||||||||||||
Net income attributable to TCF Financial Corporation | 53,125 | 38,904 | 14,221 | 36.6 | ||||||||||||||
Preferred stock dividends | 4,847 | 4,847 | - | - | ||||||||||||||
Net income available to common stockholders | $ | 48,278 | $ | 34,057 | $ | 14,221 | 41.8 | |||||||||||
Net income per common share: | ||||||||||||||||||
Basic | $ | .30 | $ | .21 | $ | .09 | 42.9 | % | ||||||||||
Diluted | .29 | .21 | .08 | 38.1 | ||||||||||||||
Dividends declared per common share | $ | .05 | $ | .05 | $ | - | - | % | ||||||||||
Average common and common equivalent | ||||||||||||||||||
shares outstanding (in thousands): | ||||||||||||||||||
Basic | 163,253 | 160,895 | 2,358 | 1.5 | % | |||||||||||||
Diluted | 163,714 | 161,749 | 1,965 | 1.2 | ||||||||||||||
N.M. Not meaningful. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | ||||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||
(Dollars in thousands, except per-share data) | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Six Months Ended June 30, | Change | |||||||||||||||||
2014 | 2013 | $ | % | |||||||||||||||
Interest income: | ||||||||||||||||||
Loans and leases | $ | 409,325 | $ | 411,580 | $ | (2,255 | ) | (.5 | ) | % | ||||||||
Securities available for sale | 5,968 | 9,432 | (3,464 | ) | (36.7 | ) | ||||||||||||
Securities held to maturity | 2,407 | 126 | 2,281 | N.M. | ||||||||||||||
Investments and other | 17,018 | 12,020 | 4,998 | 41.6 | ||||||||||||||
Total interest income | 434,718 | 433,158 | 1,560 | .4 | ||||||||||||||
Interest expense: | ||||||||||||||||||
Deposits | 16,914 | 18,532 | (1,618 | ) | (8.7 | ) | ||||||||||||
Borrowings | 10,429 | 13,491 | (3,062 | ) | (22.7 | ) | ||||||||||||
Total interest expense | 27,343 | 32,023 | (4,680 | ) | (14.6 | ) | ||||||||||||
Net interest income | 407,375 | 401,135 | 6,240 | 1.6 | ||||||||||||||
Provision for credit losses | 24,401 | 70,974 | (46,573 | ) | (65.6 | ) | ||||||||||||
Net interest income after provision for credit losses | 382,974 | 330,161 | 52,813 | 16.0 | ||||||||||||||
Non-interest income: | ||||||||||||||||||
Fees and service charges | 74,654 | 80,895 | (6,241 | ) | (7.7 | ) | ||||||||||||
Card revenue | 25,499 | 25,687 | (188 | ) | (.7 | ) | ||||||||||||
ATM revenue | 11,113 | 11,333 | (220 | ) | (1.9 | ) | ||||||||||||
Subtotal | 111,266 | 117,915 | (6,649 | ) | (5.6 | ) | ||||||||||||
Leasing and equipment finance | 45,049 | 38,813 | 6,236 | 16.1 | ||||||||||||||
Gains on sales of auto loans, net | 15,740 | 15,281 | 459 | 3.0 | ||||||||||||||
Gains on sales of consumer real estate loans, net | 19,857 | 12,195 | 7,662 | 62.8 | ||||||||||||||
Servicing fee income | 9,199 | 5,884 | 3,315 | 56.3 | ||||||||||||||
Other | 5,171 | 2,398 | 2,773 | 115.6 | ||||||||||||||
Fees and other revenue | 206,282 | 192,486 | 13,796 | 7.2 | ||||||||||||||
Gains on securities, net | 1,141 | - | 1,141 | N.M. | ||||||||||||||
Total non-interest income | 207,423 | 192,486 | 14,937 | 7.8 | ||||||||||||||
Non-interest expense: | ||||||||||||||||||
Compensation and employee benefits | 224,753 | 209,766 | 14,987 | 7.1 | ||||||||||||||
Occupancy and equipment | 69,155 | 65,937 | 3,218 | 4.9 | ||||||||||||||
FDIC insurance | 15,188 | 16,072 | (884 | ) | (5.5 | ) | ||||||||||||
Operating lease depreciation | 12,840 | 11,785 | 1,055 | 9.0 | ||||||||||||||
Advertising and marketing | 11,340 | 11,264 | 76 | .7 | ||||||||||||||
Deposit account premiums | 801 | 1,202 | (401 | ) | (33.4 | ) | ||||||||||||
Other | 83,953 | 79,885 | 4,068 | 5.1 | ||||||||||||||
Subtotal | 418,030 | 395,911 | 22,119 | 5.6 | ||||||||||||||
Foreclosed real estate and repossessed assets, net | 11,811 | 17,722 | (5,911 | ) | (33.4 | ) | ||||||||||||
Other credit costs, net | 490 | (1,065 | ) | 1,555 | N.M. | |||||||||||||
Total non-interest expense | 430,331 | 412,568 | 17,763 | 4.3 | ||||||||||||||
Income before income tax expense | 160,066 | 110,079 | 49,987 | 45.4 | ||||||||||||||
Income tax expense | 57,964 | 37,003 | 20,961 | 56.6 | ||||||||||||||
Income after income tax expense | 102,102 | 73,076 | 29,026 | 39.7 | ||||||||||||||
Income attributable to non-controlling interest | 4,220 | 4,198 | 22 | .5 | ||||||||||||||
Net income attributable to TCF Financial Corporation | 97,882 | 68,878 | 29,004 | 42.1 | ||||||||||||||
Preferred stock dividends | 9,694 | 9,371 | 323 | 3.4 | ||||||||||||||
Net income available to common stockholders | $ | 88,188 | $ | 59,507 | $ | 28,681 | 48.2 | |||||||||||
Net income per common share: | ||||||||||||||||||
Basic | $ | .54 | $ | .37 | $ | .17 | 45.9 | % | ||||||||||
Diluted | .54 | .37 | .17 | 45.9 | ||||||||||||||
Dividends declared per common share | $ | .10 | $ | .10 | $ | - | - | % | ||||||||||
Average common and common equivalent | ||||||||||||||||||
shares outstanding (in thousands): | ||||||||||||||||||
Basic | 163,011 | 160,644 | 2,367 | 1.5 | % | |||||||||||||
Diluted | 163,491 | 161,443 | 2,048 | 1.3 | ||||||||||||||
N.M. Not meaningful. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | ||||||||||||||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Three Months Ended June 30, | Change | |||||||||||||||||
2014 | 2013 | $ | % | |||||||||||||||
Net income attributable to TCF Financial Corporation | $ | 53,125 | $ | 38,904 | $ | 14,221 | 36.6 | % | ||||||||||
Other comprehensive income (loss): | ||||||||||||||||||
Securities available for sale: | ||||||||||||||||||
Unrealized gains (losses) arising during the period | 8,648 | (34,420 | ) | 43,068 | N.M. | |||||||||||||
Reclassification of net gains to net income | (452 | ) | - | (452 | ) | N.M. | ||||||||||||
Net investment hedges: | ||||||||||||||||||
Unrealized (losses) gains arising during the period | (1,382 | ) | 874 | (2,256 | ) | N.M. | ||||||||||||
Foreign currency translation adjustment: | ||||||||||||||||||
Unrealized gains (losses) arising during the period | 1,399 | (973 | ) | 2,372 | N.M. | |||||||||||||
Recognized postretirement prior service cost and transition obligation: | ||||||||||||||||||
Net actuarial losses arising during the period | (11 | ) | (12 | ) | 1 | 8.3 | ||||||||||||
Income tax (expense) benefit | (2,561 | ) | 12,662 | (15,223 | ) | N.M. | ||||||||||||
Total other comprehensive income (loss) | 5,641 | (21,869 | ) | 27,510 | N.M. | |||||||||||||
Comprehensive income | $ | 58,766 | $ | 17,035 | $ | 41,731 | N.M. | |||||||||||
Six Months Ended June 30, | Change | |||||||||||||||||
2014 | 2013 | $ | % | |||||||||||||||
Net income attributable to TCF Financial Corporation | $ | 97,882 | $ | 68,878 | $ | 29,004 | 42.1 | % | ||||||||||
Other comprehensive income (loss): | ||||||||||||||||||
Securities available for sale: | ||||||||||||||||||
Unrealized gains (losses) arising during the period | 20,514 | (48,249 | ) | 68,763 | N.M. | |||||||||||||
Reclassification of net gains to net income | (629 | ) | - | (629 | ) | N.M. | ||||||||||||
Net investment hedges: | ||||||||||||||||||
Unrealized (losses) gains arising during the period | (172 | ) | 1,411 | (1,583 | ) | N.M. | ||||||||||||
Foreign currency translation adjustment: | ||||||||||||||||||
Unrealized gains (losses) arising during the period | 23 | (1,595 | ) | 1,618 | N.M. | |||||||||||||
Recognized postretirement prior service cost and transition obligation: | ||||||||||||||||||
Net actuarial losses arising during the period | (23 | ) | (24 | ) | 1 | 4.2 | ||||||||||||
Income tax (expense) benefit | (7,415 | ) | 17,681 | (25,096 | ) | N.M. | ||||||||||||
Total other comprehensive income (loss) | 12,298 | (30,776 | ) | 43,074 | N.M. | |||||||||||||
Comprehensive income | $ | 110,180 | $ | 38,102 | $ | 72,078 | 189.2 | |||||||||||
N.M. Not meaningful. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION | |||||||||||||||||||
(Dollars in thousands, except per-share data) | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
At Jun. 30, | At Dec. 31, | Change | |||||||||||||||||
2014 | 2013 | $ | % | ||||||||||||||||
ASSETS | |||||||||||||||||||
Cash and due from banks | $ | 881,396 | $ | 915,076 | $ | (33,680 | ) | (3.7 | ) | % | |||||||||
Investments | 85,449 | 94,326 | (8,877 | ) | (9.4 | ) | |||||||||||||
Securities held to maturity | 220,801 | 19,912 | 200,889 | N.M. | |||||||||||||||
Securities available for sale | 413,316 | 551,064 | (137,748 | ) | (25.0 | ) | |||||||||||||
Loans and leases held for sale | 314,277 | 79,768 | 234,509 | N.M. | |||||||||||||||
Loans and leases: | |||||||||||||||||||
Consumer real estate: | |||||||||||||||||||
First mortgage lien | 3,542,324 | 3,766,421 | (224,097 | ) | (5.9 | ) | |||||||||||||
Junior lien | 2,480,763 | 2,572,905 | (92,142 | ) | (3.6 | ) | |||||||||||||
Total consumer real estate | 6,023,087 | 6,339,326 | (316,239 | ) | (5.0 | ) | |||||||||||||
Commercial | 3,093,161 | 3,148,352 | (55,191 | ) | (1.8 | ) | |||||||||||||
Leasing and equipment finance | 3,526,264 | 3,428,755 | 97,509 | 2.8 | |||||||||||||||
Inventory finance | 1,880,667 | 1,664,377 | 216,290 | 13.0 | |||||||||||||||
Auto finance | 1,502,860 | 1,239,386 | 263,474 | 21.3 | |||||||||||||||
Other loans and leases | 24,486 | 26,743 | (2,257 | ) | (8.4 | ) | |||||||||||||
Total loans and leases | 16,050,525 | 15,846,939 | 203,586 | 1.3 | |||||||||||||||
Allowance for loan and lease losses | (236,081 | ) | (252,230 | ) | 16,149 | 6.4 | |||||||||||||
Net loans and leases | 15,814,444 | 15,594,709 | 219,735 | 1.4 | |||||||||||||||
Premises and equipment, net | 436,558 | 437,602 | (1,044 | ) | (.2 | ) | |||||||||||||
Goodwill | 225,640 | 225,640 | - | - | |||||||||||||||
Other assets | 445,896 | 461,743 | (15,847 | ) | (3.4 | ) | |||||||||||||
Total assets | $ | 18,837,777 | $ | 18,379,840 | $ | 457,937 | 2.5 | ||||||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Checking | $ | 5,120,671 | $ | 4,980,451 | $ | 140,220 | 2.8 | ||||||||||||
Savings | 5,685,776 | 6,194,003 | (508,227 | ) | (8.2 | ) | |||||||||||||
Money market | 1,284,213 | 831,910 | 452,303 | 54.4 | |||||||||||||||
Subtotal | 12,090,660 | 12,006,364 | 84,296 | .7 | |||||||||||||||
Certificates of deposit | 2,955,492 | 2,426,412 | 529,080 | 21.8 | |||||||||||||||
Total deposits | 15,046,152 | 14,432,776 | 613,376 | 4.2 | |||||||||||||||
Short-term borrowings | 8,263 | 4,918 | 3,345 | 68.0 | |||||||||||||||
Long-term borrowings | 1,221,537 | 1,483,325 | (261,788 | ) | (17.6 | ) | |||||||||||||
Total borrowings | 1,229,800 | 1,488,243 | (258,443 | ) | (17.4 | ) | |||||||||||||
Accrued expenses and other liabilities | 490,114 | 494,062 | (3,948 | ) | (.8 | ) | |||||||||||||
Total liabilities | 16,766,066 | 16,415,081 | 350,985 | 2.1 | |||||||||||||||
Equity: | |||||||||||||||||||
Preferred stock, par value $.01 per share, | |||||||||||||||||||
30,000,000 authorized; and 4,006,900 shares issued | 263,240 | 263,240 | - | - | |||||||||||||||
Common stock, par value $.01 per share, | |||||||||||||||||||
280,000,000 shares authorized; 166,924,026 | |||||||||||||||||||
and 165,164,861 shares issued, respectively | 1,669 | 1,652 | 17 | 1.0 | |||||||||||||||
Additional paid-in capital | 806,645 | 779,641 | 27,004 | 3.5 | |||||||||||||||
Retained earnings, subject to certain restrictions | 1,049,725 | 977,846 | 71,879 | 7.4 | |||||||||||||||
Accumulated other comprehensive loss | (14,915 | ) | (27,213 | ) | 12,298 | 45.2 | |||||||||||||
Treasury stock at cost, 42,566 shares, and other | (51,458 | ) | (42,198 | ) | (9,260 | ) | (21.9 | ) | |||||||||||
Total TCF Financial Corporation stockholders' equity | 2,054,906 | 1,952,968 | 101,938 | 5.2 | |||||||||||||||
Non-controlling interest in subsidiaries | 16,805 | 11,791 | 5,014 | 42.5 | |||||||||||||||
Total equity | 2,071,711 | 1,964,759 | 106,952 | 5.4 | |||||||||||||||
Total liabilities and equity | $ | 18,837,777 | $ | 18,379,840 | $ | 457,937 | 2.5 | ||||||||||||
N.M. Not Meaningful. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||||||||||
SUMMARY OF CREDIT QUALITY DATA | |||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||
At | At | At | At | At | Change from | ||||||||||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | Jun. 30, | |||||||||||||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
Delinquency Data - Principal Balances (1) | |||||||||||||||||||||||||||||||
60 days or more: | |||||||||||||||||||||||||||||||
Consumer real estate | |||||||||||||||||||||||||||||||
First mortgage lien | $ | 20,678 | $ | 20,051 | $ | 20,894 | $ | 23,576 | $ | 66,876 | $ | 627 | $ | (46,198 | ) | ||||||||||||||||
Junior lien | 2,415 | 4,049 | 3,532 | 3,822 | 8,022 | (1,634 | ) | (5,607 | ) | ||||||||||||||||||||||
Total consumer real estate | 23,093 | 24,100 | 24,426 | 27,398 | 74,898 | (1,007 | ) | (51,805 | ) | ||||||||||||||||||||||
Commercial | - | 1,905 | 1,430 | 7,201 | 1,679 | (1,905 | ) | (1,679 | ) | ||||||||||||||||||||||
Leasing and equipment finance | 2,642 | 2,864 | 2,401 | 2,539 | 1,840 | (222 | ) | 802 | |||||||||||||||||||||||
Inventory finance | 204 | 212 | 50 | 71 | 33 | (8 | ) | 171 | |||||||||||||||||||||||
Auto finance | 2,152 | 1,554 | 1,877 | 1,429 | 868 | 598 | 1,284 | ||||||||||||||||||||||||
Other | 2 | 3 | 10 | - | 26 | (1 | ) | (24 | ) | ||||||||||||||||||||||
Subtotal | 28,093 | 30,638 | 30,194 | 38,638 | 79,344 | (2,545 | ) | (51,251 | ) | ||||||||||||||||||||||
Acquired portfolios | 252 | 240 | 458 | 334 | 627 | 12 | (375 | ) | |||||||||||||||||||||||
Total delinquencies | $ | 28,345 | $ | 30,878 | $ | 30,652 | $ | 38,972 | $ | 79,971 | $ | (2,533 | ) | $ | (51,626 | ) | |||||||||||||||
Delinquency Data - % of Portfolio (1) | |||||||||||||||||||||||||||||||
60 days or more: | |||||||||||||||||||||||||||||||
Consumer real estate | |||||||||||||||||||||||||||||||
First mortgage lien | .61 | % | .57 | % | .58 | % | .64 | % | 1.74 | % | 4 | bps | (113 | ) | bps | ||||||||||||||||
Junior lien | .10 | .17 | .14 | .15 | .34 | (7 | ) | (24 | ) | ||||||||||||||||||||||
Total consumer real estate | .40 | .41 | .40 | .44 | 1.21 | (1 | ) | (81 | ) | ||||||||||||||||||||||
Commercial | - | .06 | .05 | .23 | .05 | (6 | ) | (5 | ) | ||||||||||||||||||||||
Leasing and equipment finance | .08 | .08 | .07 | .08 | .06 | - | 2 | ||||||||||||||||||||||||
Inventory finance | .01 | .01 | - | - | - | - | 1 | ||||||||||||||||||||||||
Auto finance | .14 | .11 | .15 | .13 | .10 | 3 | 4 | ||||||||||||||||||||||||
Other | .01 | .01 | .04 | - | .11 | - | (10 | ) | |||||||||||||||||||||||
Subtotal | .18 | .19 | .19 | .25 | .52 | (1 | ) | (34 | ) | ||||||||||||||||||||||
Acquired portfolios | 2.27 | 1.38 | 1.64 | .80 | .99 | 89 | 128 | ||||||||||||||||||||||||
Total delinquencies | .18 | .19 | .20 | .25 | .52 | (1 | ) | (34 | ) | ||||||||||||||||||||||
(1) Excludes non-accrual loans and leases. | |||||||||||||||||||||||||||||||
At | At | At | At | At | Change from | ||||||||||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | Jun. 30, | |||||||||||||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
Non-Accrual Loans and Leases | |||||||||||||||||||||||||||||||
Non-accrual loans and leases: | |||||||||||||||||||||||||||||||
Consumer real estate | |||||||||||||||||||||||||||||||
First mortgage lien | $ | 172,256 | $ | 176,841 | $ | 180,811 | $ | 170,306 | $ | 132,586 | $ | (4,585 | ) | $ | 39,670 | ||||||||||||||||
Junior lien | 38,146 | 39,222 | 38,222 | 35,732 | 30,744 | (1,076 | ) | 7,402 | |||||||||||||||||||||||
Total consumer real estate | 210,402 | 216,063 | 219,033 | 206,038 | 163,330 | (5,661 | ) | 47,072 | |||||||||||||||||||||||
Commercial | 30,051 | 35,209 | 40,539 | 62,273 | 102,103 | (5,158 | ) | (72,052 | ) | ||||||||||||||||||||||
Leasing and equipment finance | 16,093 | 13,908 | 14,041 | 11,820 | 11,103 | 2,185 | 4,990 | ||||||||||||||||||||||||
Inventory finance | 1,988 | 307 | 2,529 | 1,802 | 1,008 | 1,681 | 980 | ||||||||||||||||||||||||
Auto finance | 1,468 | 856 | 470 | 212 | 118 | 612 | 1,350 | ||||||||||||||||||||||||
Other | 292 | 336 | 410 | 728 | 809 | (44 | ) | (517 | ) | ||||||||||||||||||||||
Total non-accrual loans and leases | $ | 260,294 | $ | 266,679 | $ | 277,022 | $ | 282,873 | $ | 278,471 | $ | (6,385 | ) | $ | (18,177 | ) | |||||||||||||||
Non-accrual loans and leases - rollforward: | |||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 266,679 | $ | 277,022 | $ | 282,873 | $ | 278,471 | $ | 343,388 | $ | (10,343 | ) | $ | (76,709 | ) | |||||||||||||||
Additions | 61,242 | 54,432 | 71,513 | 93,337 | 41,549 | 6,810 | 19,693 | ||||||||||||||||||||||||
Charge-offs | (15,135 | ) | (15,323 | ) | (25,195 | ) | (10,225 | ) | (12,780 | ) | 188 | (2,355 | ) | ||||||||||||||||||
Transfers to other assets | (17,994 | ) | (15,609 | ) | (23,085 | ) | (23,810 | ) | (16,014 | ) | (2,385 | ) | (1,980 | ) | |||||||||||||||||
Return to accrual status | (18,224 | ) | (16,334 | ) | (13,085 | ) | (16,218 | ) | (21,360 | ) | (1,890 | ) | 3,136 | ||||||||||||||||||
Payments received | (14,910 | ) | (17,925 | ) | (13,331 | ) | (40,319 | ) | (16,977 | ) | 3,015 | 2,067 | |||||||||||||||||||
Sales | (1,900 | ) | - | (3,602 | ) | - | (40,461 | ) | (1,900 | ) | 38,561 | ||||||||||||||||||||
Other, net | 536 | 416 | 934 | 1,637 | 1,126 | 120 | (590 | ) | |||||||||||||||||||||||
Balance, end of period | $ | 260,294 | $ | 266,679 | $ | 277,022 | $ | 282,873 | $ | 278,471 | $ | (6,385 | ) | $ | (18,177 | ) |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | ||||||||||||||||||||||||||||||
SUMMARY OF CREDIT QUALITY DATA, CONTINUED | ||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||
Change from | ||||||||||||||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | Jun. 30, | ||||||||||||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||
Other Real Estate Owned | ||||||||||||||||||||||||||||||
Other real estate owned: | ||||||||||||||||||||||||||||||
Consumer real estate | $ | 42,745 | $ | 43,149 | $ | 47,637 | $ | 48,910 | $ | 44,759 | $ | (404 | ) | $ | (2,014 | ) | ||||||||||||||
Commercial real estate | 22,335 | 20,299 | 21,237 | 16,669 | 21,473 | 2,036 | 862 | |||||||||||||||||||||||
Total other real estate owned | $ | 65,080 | $ | 63,448 | $ | 68,874 | $ | 65,579 | $ | 66,232 | $ | 1,632 | $ | (1,152 | ) | |||||||||||||||
Other real estate owned - rollforward: | ||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 63,448 | $ | 68,874 | $ | 65,579 | $ | 66,232 | $ | 71,763 | $ | (5,426 | ) | $ | (8,315 | ) | ||||||||||||||
Transferred in | 15,751 | 14,160 | 21,045 | 23,339 | 16,503 | 1,591 | (752 | ) | ||||||||||||||||||||||
Sales | (15,998 | ) | (17,526 | ) | (15,939 | ) | (22,683 | ) | (17,895 | ) | 1,528 | 1,897 | ||||||||||||||||||
Writedowns | (2,782 | ) | (3,147 | ) | (3,496 | ) | (2,197 | ) | (4,270 | ) | 365 | 1,488 | ||||||||||||||||||
Other, net | 4,661 | 1,087 | 1,685 | 888 | 131 | 3,574 | 4,530 | |||||||||||||||||||||||
Balance, end of period | $ | 65,080 | $ | 63,448 | $ | 68,874 | $ | 65,579 | $ | 66,232 | $ | 1,632 | $ | (1,152 | ) | |||||||||||||||
Ending number of properties: (1) | ||||||||||||||||||||||||||||||
Consumer real estate | 396 | 411 | 479 | 511 | 433 | (15 | ) | (37 | ) | |||||||||||||||||||||
Commercial real estate | 14 | 16 | 18 | 18 | 22 | (2 | ) | (8 | ) | |||||||||||||||||||||
Total | 410 | 427 | 497 | 529 | 455 | (17 | ) | (45 | ) | |||||||||||||||||||||
(1) Includes properties owned and foreclosed properties subject to redemption. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||
SUMMARY OF CREDIT QUALITY DATA, CONTINUED | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
Allowance for Loan and Lease Losses | |||||||||||||||||||||||
At June 30, 2014 | At March 31, 2014 | At June 30, 2013 | Change from | ||||||||||||||||||||
% of | % of | % of | Mar. 31, | Jun. 30, | |||||||||||||||||||
Balance | Portfolio | Balance | Portfolio | Balance | Portfolio | 2014 | 2013 | ||||||||||||||||
Consumer real estate | $ | 161,349 | 2.68 | % | $ | 169,367 | 2.79 | % | $ | 181,052 | 2.85 | % | (11) | bps | (17) | bps | |||||||
Commercial | 31,361 | 1.01 | 36,062 | 1.15 | 50,072 | 1.49 | (14) | (48) | |||||||||||||||
Leasing and equipment finance | 19,184 | .54 | 18,623 | .54 | 17,975 | .55 | - | (1) | |||||||||||||||
Inventory finance | 9,539 | .51 | 10,309 | .49 | 8,197 | .48 | 2 | 3 | |||||||||||||||
Auto finance | 13,865 | .92 | 12,062 | .86 | 7,509 | .85 | 6 | 7 | |||||||||||||||
Other | 783 | 3.20 | 623 | 2.76 | 794 | 3.16 | 44 | 4 | |||||||||||||||
Total | $ | 236,081 | 1.47 | $ | 247,046 | 1.52 | $ | 265,599 | 1.70 | (5) | (23) | ||||||||||||
Net Charge-Offs | |||||||||||||||||||||||
Change from | |||||||||||||||||||||||
Quarter Ended | Quarter Ended | ||||||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | Jun. 30, | |||||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 | |||||||||||||||||
Consumer real estate | |||||||||||||||||||||||
First mortgage lien | $ | 7,165 | $ | 9,678 | $ | 10,545 | $ | 12,770 | $ | 15,084 | $ | (2,513) | $ | (7,919) | |||||||||
Junior lien | 4,292 | 3,025 | 5,901 | 5,474 | 8,642 | 1,267 | (4,350) | ||||||||||||||||
Total consumer real estate | 11,457 | 12,703 | 16,446 | 18,244 | 23,726 | (1,246) | (12,269) | ||||||||||||||||
Commercial | 3,477 | 1,510 | 9,363 | 6,513 | 2,449 | 1,967 | 1,028 | ||||||||||||||||
Leasing and equipment finance | 974 | 749 | 1,197 | 658 | 244 | 225 | 730 | ||||||||||||||||
Inventory finance | 107 | (134) | 341 | 86 | (14) | 241 | 121 | ||||||||||||||||
Auto finance | 1,833 | 2,276 | 1,976 | 1,122 | 765 | (443) | 1,068 | ||||||||||||||||
Other | 507 | 312 | 774 | 993 | 524 | 195 | (17) | ||||||||||||||||
Total | $ | 18,355 | $ | 17,416 | $ | 30,097 | $ | 27,616 | $ | 27,694 | $ | 939 | $ | (9,339) | |||||||||
Net Charge-Offs as a Percentage of Average Loans and Leases | |||||||||||||||||||||||
Change from | |||||||||||||||||||||||
Quarter Ended (1) | Quarter Ended | ||||||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | Mar. 31, | Jun. 30, | |||||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 | |||||||||||||||||
Consumer real estate | |||||||||||||||||||||||
First mortgage lien | .79 | % | 1.04 | % | 1.11 | % | 1.30 | % | 1.48 | % | (25) | bps | (69) | bps | |||||||||
Junior lien | .69 | .46 | .91 | .88 | 1.46 | 23 | (77) | ||||||||||||||||
Total consumer real estate | .75 | .80 | 1.03 | 1.14 | 1.48 | (5) | (73) | ||||||||||||||||
Commercial | .44 | .19 | 1.21 | .79 | .29 | 25 | 15 | ||||||||||||||||
Leasing and equipment finance | .11 | .09 | .14 | .08 | .03 | 2 | 8 | ||||||||||||||||
Inventory finance | .02 | (.03) | .08 | .02 | - | 5 | 2 | ||||||||||||||||
Auto finance | .48 | .69 | .68 | .46 | .37 | (21) | 11 | ||||||||||||||||
Other | N.M. | N.M. | N.M. | N.M. | 16.05 | N.M. | N.M. | ||||||||||||||||
Total | .45 | .43 | .76 | .71 | .70 | 2 | (25) | ||||||||||||||||
(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 June 30, | ||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||
Average | Yields and | Average | Yields and | |||||||||||||||||||
Balance | Interest (2) | Rates (1)(2) | Balance | Interest (2) | Rates (1)(2) | |||||||||||||||||
ASSETS: | ||||||||||||||||||||||
Investments and other | $ | 623,721 | $ | 4,054 | 2.61 | % | $ | 729,514 | $ | 3,699 | 2.03 | % | ||||||||||
Securities held to maturity | 217,477 | 1,443 | 2.65 | 5,564 | 62 | 4.47 | ||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||
U.S. Government sponsored entities: | ||||||||||||||||||||||
Mortgage-backed securities, fixed rate | 408,000 | 2,804 | 2.75 | 654,968 | 4,636 | 2.83 | ||||||||||||||||
U.S. Treasury securities | - | - | - | 494 | - | .07 | ||||||||||||||||
Other securities | 75 | 1 | 2.46 | 93 | 1 | 2.54 | ||||||||||||||||
Total securities available for sale (3) | 408,075 | 2,805 | 2.75 | 655,555 | 4,637 | 2.83 | ||||||||||||||||
Loans and leases held for sale | 240,304 | 5,001 | 8.35 | 116,390 | 2,535 | 8.74 | ||||||||||||||||
Loans and leases: | ||||||||||||||||||||||
Consumer real estate: | ||||||||||||||||||||||
Fixed-rate | 3,393,788 | 48,372 | 5.72 | 3,809,066 | 55,977 | 5.89 | ||||||||||||||||
Variable-rate | 2,710,998 | 34,757 | 5.14 | 2,621,619 | 33,545 | 5.13 | ||||||||||||||||
Total consumer real estate | 6,104,786 | 83,129 | 5.46 | 6,430,685 | 89,522 | 5.58 | ||||||||||||||||
Commercial: | ||||||||||||||||||||||
Fixed-rate | 1,515,353 | 19,503 | 5.16 | 1,833,144 | 24,006 | 5.25 | ||||||||||||||||
Variable- and adjustable-rate | 1,615,967 | 16,151 | 4.01 | 1,503,262 | 15,602 | 4.16 | ||||||||||||||||
Total commercial | 3,131,320 | 35,654 | 4.57 | 3,336,406 | 39,608 | 4.76 | ||||||||||||||||
Leasing and equipment finance | 3,500,647 | 41,276 | 4.72 | 3,236,799 | 39,990 | 4.94 | ||||||||||||||||
Inventory finance | 2,061,437 | 30,482 | 5.93 | 1,875,810 | 27,860 | 5.96 | ||||||||||||||||
Auto finance | 1,518,194 | 16,770 | 4.43 | 823,102 | 10,193 | 4.97 | ||||||||||||||||
Other | 12,040 | 230 | 7.63 | 13,060 | 263 | 8.10 | ||||||||||||||||
Total loans and leases (4) | 16,328,424 | 207,541 | 5.10 | 15,715,862 | 207,436 | 5.29 | ||||||||||||||||
Total interest-earning assets | 17,818,001 | 220,844 | 4.97 | 17,222,885 | 218,369 | 5.08 | ||||||||||||||||
Other assets (5) | 1,123,148 | 1,110,213 | ||||||||||||||||||||
Total assets | $ | 18,941,149 | $ | 18,333,098 | ||||||||||||||||||
LIABILITIES AND EQUITY: | ||||||||||||||||||||||
Non-interest bearing deposits: | ||||||||||||||||||||||
Retail | $ | 1,579,528 | $ | 1,476,173 | ||||||||||||||||||
Small business | 788,540 | 752,395 | ||||||||||||||||||||
Commercial and custodial | 388,562 | 326,773 | ||||||||||||||||||||
Total non-interest bearing deposits | 2,756,630 | 2,555,341 | ||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||
Checking | 2,363,106 | 261 | .04 | 2,351,652 | 377 | .06 | ||||||||||||||||
Savings | 5,887,133 | 2,406 | .16 | 6,059,640 | 2,790 | .18 | ||||||||||||||||
Money market | 1,019,543 | 1,098 | .43 | 791,859 | 547 | .28 | ||||||||||||||||
Subtotal | 9,269,782 | 3,765 | .16 | 9,203,151 | 3,714 | .16 | ||||||||||||||||
Certificates of deposit | 2,742,832 | 5,112 | .75 | 2,360,881 | 5,137 | .87 | ||||||||||||||||
Total interest-bearing deposits | 12,012,614 | 8,877 | .30 | 11,564,032 | 8,851 | .31 | ||||||||||||||||
Total deposits | 14,769,244 | 8,877 | .24 | 14,119,373 | 8,851 | .25 | ||||||||||||||||
Borrowings: | ||||||||||||||||||||||
Short-term borrowings | 220,042 | 145 | .26 | 7,314 | 8 | .44 | ||||||||||||||||
Long-term borrowings | 1,368,480 | 4,968 | 1.45 | 1,879,576 | 6,705 | 1.43 | ||||||||||||||||
Total borrowings | 1,588,522 | 5,113 | 1.29 | 1,886,890 | 6,713 | 1.42 | ||||||||||||||||
Total interest-bearing liabilities | 13,601,136 | 13,990 | .41 | 13,450,922 | 15,564 | .46 | ||||||||||||||||
Total deposits and borrowings | 16,357,766 | 13,990 | .34 | 16,006,263 | 15,564 | .39 | ||||||||||||||||
Other liabilities | 541,458 | 420,398 | ||||||||||||||||||||
Total liabilities | 16,899,224 | 16,426,661 | ||||||||||||||||||||
Total TCF Financial Corp. stockholders' equity | 2,020,815 | 1,886,138 | ||||||||||||||||||||
Non-controlling interest in subsidiaries | 21,110 | 20,299 | ||||||||||||||||||||
Total equity | 2,041,925 | 1,906,437 | ||||||||||||||||||||
Total liabilities and equity | $ | 18,941,149 | $ | 18,333,098 | ||||||||||||||||||
Net interest income and margin | $ | 206,854 | 4.65 | $ | 202,805 | 4.72 | ||||||||||||||||
(1) Annualized. | ||||||||||||||||||||||
(2) Interest and yields are presented on a fully tax-equivalent basis. | ||||||||||||||||||||||
(3) Average balances and yields of securities available for sale are based upon historical amortized cost and exclude equity securities. | ||||||||||||||||||||||
(4) Average balances of loans and leases include non-accrual loans and leases, and are presented net of unearned income. | ||||||||||||||||||||||
(5) Includes operating leases. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
Six Months Ended June 30, | |||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||
Average | Yields and | Average | Yields and | ||||||||||||||||||||
Balance | Interest (2) | Rates (1)(2) | Balance | Interest (2) | Rates (1)(2) | ||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Investments and other | $ | 622,277 | $ | 8,039 | 2.60 | % | $ | 769,379 | $ | 6,881 | 1.80 | % | |||||||||||
Securities held to maturity | 179,509 | 2,407 | 2.68 | 5,608 | 126 | 4.50 | |||||||||||||||||
Securities available for sale: | |||||||||||||||||||||||
U.S. Government sponsored entities: | |||||||||||||||||||||||
Mortgage-backed securities, fixed rate | 437,708 | 5,967 | 2.73 | 664,858 | 9,430 | 2.84 | |||||||||||||||||
U.S. Treasury securities | - | - | - | 696 | - | .07 | |||||||||||||||||
Other securities | 78 | 1 | 2.47 | 100 | 2 | 2.52 | |||||||||||||||||
Total securities available for sale (3) | 437,786 | 5,968 | 2.73 | 665,654 | 9,432 | 2.83 | |||||||||||||||||
Loans and leases held for sale | 218,210 | 8,979 | 8.30 | 135,472 | 5,139 | 7.65 | |||||||||||||||||
Loans and leases: | |||||||||||||||||||||||
Consumer real estate: | |||||||||||||||||||||||
Fixed-rate | 3,446,020 | 96,904 | 5.67 | 3,862,590 | 113,035 | 5.90 | |||||||||||||||||
Variable-rate | 2,769,663 | 70,573 | 5.14 | 2,630,618 | 66,627 | 5.11 | |||||||||||||||||
Total consumer real estate | 6,215,683 | 167,477 | 5.43 | 6,493,208 | 179,662 | 5.58 | |||||||||||||||||
Commercial: | |||||||||||||||||||||||
Fixed-rate | 1,537,549 | 38,999 | 5.11 | 1,866,667 | 49,191 | 5.31 | |||||||||||||||||
Variable- and adjustable-rate | 1,589,169 | 32,329 | 4.10 | 1,474,400 | 30,485 | 4.17 | |||||||||||||||||
Total commercial | 3,126,718 | 71,328 | 4.60 | 3,341,067 | 79,676 | 4.81 | |||||||||||||||||
Leasing and equipment finance | 3,467,851 | 82,055 | 4.73 | 3,218,252 | 80,903 | 5.03 | |||||||||||||||||
Inventory finance | 1,968,431 | 57,951 | 5.94 | 1,780,058 | 53,465 | 6.06 | |||||||||||||||||
Auto finance | 1,423,240 | 31,557 | 4.47 | 747,022 | 18,835 | 5.08 | |||||||||||||||||
Other | 12,654 | 472 | 7.52 | 13,348 | 539 | 8.15 | |||||||||||||||||
Total loans and leases (4) | 16,214,577 | 410,840 | 5.10 | 15,592,955 | 413,080 | 5.33 | |||||||||||||||||
Total interest-earning assets | 17,672,359 | 436,233 | 4.97 | 17,169,068 | 434,658 | 5.10 | |||||||||||||||||
Other assets (5) | 1,109,685 | 1,118,397 | |||||||||||||||||||||
Total assets | $ | 18,782,044 | $ | 18,287,465 | |||||||||||||||||||
LIABILITIES AND EQUITY: | |||||||||||||||||||||||
Non-interest bearing deposits: | |||||||||||||||||||||||
Retail | $ | 1,558,414 | $ | 1,451,381 | |||||||||||||||||||
Small business | 780,229 | 748,304 | |||||||||||||||||||||
Commercial and custodial | 387,749 | 328,373 | |||||||||||||||||||||
Total non-interest bearing deposits | 2,726,392 | 2,528,058 | |||||||||||||||||||||
Interest-bearing deposits: | |||||||||||||||||||||||
Checking | 2,353,156 | 522 | .04 | 2,330,078 | 874 | .08 | |||||||||||||||||
Savings | 6,003,000 | 4,935 | .17 | 6,074,949 | 6,159 | .20 | |||||||||||||||||
Money market | 919,981 | 1,673 | .37 | 803,551 | 1,177 | .30 | |||||||||||||||||
Subtotal | 9,276,137 | 7,130 | .15 | 9,208,578 | 8,210 | .18 | |||||||||||||||||
Certificates of deposit | 2,643,639 | 9,784 | .75 | 2,342,178 | 10,322 | .89 | |||||||||||||||||
Total interest-bearing deposits | 11,919,776 | 16,914 | .29 | 11,550,756 | 18,532 | .32 | |||||||||||||||||
Total deposits | 14,646,168 | 16,914 | .23 | 14,078,814 | 18,532 | .27 | |||||||||||||||||
Borrowings: | |||||||||||||||||||||||
Short-term borrowings | 159,401 | 225 | .28 | 7,966 | 16 | .42 | |||||||||||||||||
Long-term borrowings | 1,430,941 | 10,204 | 1.43 | 1,903,227 | 13,475 | 1.42 | |||||||||||||||||
Total borrowings | 1,590,342 | 10,429 | 1.31 | 1,911,193 | 13,491 | 1.42 | |||||||||||||||||
Total interest-bearing liabilities | 13,510,118 | 27,343 | .41 | 13,461,949 | 32,023 | .48 | |||||||||||||||||
Total deposits and borrowings | 16,236,510 | 27,343 | .34 | 15,990,007 | 32,023 | .40 | |||||||||||||||||
Other liabilities | 531,806 | 404,571 | |||||||||||||||||||||
Total liabilities | 16,768,316 | 16,394,578 | |||||||||||||||||||||
Total TCF Financial Corp. stockholders' equity | 1,995,373 | 1,874,348 | |||||||||||||||||||||
Non-controlling interest in subsidiaries | 18,355 | 18,539 | |||||||||||||||||||||
Total equity | 2,013,728 | 1,892,887 | |||||||||||||||||||||
Total liabilities and equity | $ | 18,782,044 | $ | 18,287,465 | |||||||||||||||||||
Net interest income and margin | $ | 408,890 | 4.66 | $ | 402,635 | 4.72 | |||||||||||||||||
(1) Annualized. | |||||||||||||||||||||||
(2) Interest and yields are presented on a fully tax-equivalent basis. | |||||||||||||||||||||||
(3) Average balances and yields of securities available for sale are based upon historical amortized cost and exclude equity securities. | |||||||||||||||||||||||
(4) Average balances of loans and leases include non-accrual loans and leases, and are presented net of unearned income. | |||||||||||||||||||||||
(5) Includes operating leases. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME AND FINANCIAL HIGHLIGHTS | |||||||||||||||||||
(Dollars in thousands, except per-share data) | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | |||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | |||||||||||||||
Interest income: | |||||||||||||||||||
Loans and leases | $ | 206,788 | $ | 202,537 | $ | 204,042 | $ | 203,879 | $ | 206,675 | |||||||||
Securities available for sale | 2,805 | 3,163 | 4,194 | 4,448 | 4,637 | ||||||||||||||
Securities held to maturity | 1,443 | 964 | 94 | 57 | 62 | ||||||||||||||
Investments and other | 9,055 | 7,963 | 7,599 | 7,069 | 6,234 | ||||||||||||||
Total interest income | 220,091 | 214,627 | 215,929 | 215,453 | 217,608 | ||||||||||||||
Interest expense: | |||||||||||||||||||
Deposits | 8,877 | 8,037 | 8,428 | 9,644 | 8,851 | ||||||||||||||
Borrowings | 5,113 | 5,316 | 5,639 | 6,182 | 6,713 | ||||||||||||||
Total interest expense | 13,990 | 13,353 | 14,067 | 15,826 | 15,564 | ||||||||||||||
Net interest income | 206,101 | 201,274 | 201,862 | 199,627 | 202,044 | ||||||||||||||
Provision for credit losses | 9,909 | 14,492 | 22,792 | 24,602 | 32,591 | ||||||||||||||
Net interest income after provision for credit losses | 196,192 | 186,782 | 179,070 | 175,025 | 169,453 | ||||||||||||||
Non-interest income: | |||||||||||||||||||
Fees and service charges | 38,035 | 36,619 | 43,254 | 42,457 | 41,572 | ||||||||||||||
Card revenue | 13,249 | 12,250 | 13,066 | 13,167 | 13,270 | ||||||||||||||
ATM revenue | 5,794 | 5,319 | 5,382 | 5,941 | 5,828 | ||||||||||||||
Subtotal | 57,078 | 54,188 | 61,702 | 61,565 | 60,670 | ||||||||||||||
Leasing and equipment finance | 23,069 | 21,980 | 23,328 | 28,778 | 22,609 | ||||||||||||||
Gains on sales of auto loans, net | 7,270 | 8,470 | 7,278 | 7,140 | 8,135 | ||||||||||||||
Gains on sales of consumer real estate loans, net | 8,151 | 11,706 | 5,345 | 4,152 | 4,069 | ||||||||||||||
Servicing fee income | 4,892 | 4,307 | 3,903 | 3,619 | 3,128 | ||||||||||||||
Other | 2,789 | 2,382 | 2,812 | 986 | 1,172 | ||||||||||||||
Fees and other revenue | 103,249 | 103,033 | 104,368 | 106,240 | 99,783 | ||||||||||||||
Gains (losses) on securities, net | 767 | 374 | 1,044 | (80) | - | ||||||||||||||
Total non-interest income | 104,016 | 103,407 | 105,412 | 106,160 | 99,783 | ||||||||||||||
Non-interest expense: | |||||||||||||||||||
Compensation and employee benefits | 109,664 | 115,089 | 108,589 | 110,833 | 105,537 | ||||||||||||||
Occupancy and equipment | 34,316 | 34,839 | 35,504 | 33,253 | 33,062 | ||||||||||||||
FDIC insurance | 7,625 | 7,563 | 7,892 | 8,102 | 8,362 | ||||||||||||||
Operating lease depreciation | 6,613 | 6,227 | 6,009 | 6,706 | 6,150 | ||||||||||||||
Advertising and marketing | 5,862 | 5,478 | 3,275 | 4,593 | 5,532 | ||||||||||||||
Deposit account premiums | 383 | 418 | 479 | 664 | 600 | ||||||||||||||
Other | 42,618 | 41,335 | 44,162 | 43,730 | 41,946 | ||||||||||||||
Subtotal | 207,081 | 210,949 | 205,910 | 207,881 | 201,189 | ||||||||||||||
Branch realignment | - | - | 8,869 | - | - | ||||||||||||||
Foreclosed real estate and repossessed assets, net | 5,743 | 6,068 | 6,066 | 4,162 | 7,555 | ||||||||||||||
Other credit costs, net | 371 | 119 | (376) | 189 | (228) | ||||||||||||||
Total non-interest expense | 213,195 | 217,136 | 220,469 | 212,232 | 208,516 | ||||||||||||||
Income before income tax expense | 87,013 | 73,053 | 64,013 | 68,953 | 60,720 | ||||||||||||||
Income tax expense | 31,385 | 26,579 | 22,791 | 24,551 | 19,444 | ||||||||||||||
Income after income tax expense | 55,628 | 46,474 | 41,222 | 44,402 | 41,276 | ||||||||||||||
Income attributable to non-controlling interest | 2,503 | 1,717 | 1,227 | 1,607 | 2,372 | ||||||||||||||
Net income attributable to TCF Financial Corporation | 53,125 | 44,757 | 39,995 | 42,795 | 38,904 | ||||||||||||||
Preferred stock dividends | 4,847 | 4,847 | 4,847 | 4,847 | 4,847 | ||||||||||||||
Net income available to common stockholders | $ | 48,278 | $ | 39,910 | $ | 35,148 | $ | 37,948 | $ | 34,057 | |||||||||
Net income per common share: | |||||||||||||||||||
Basic | $ | .30 | $ | .25 | $ | .22 | $ | .24 | $ | .21 | |||||||||
Diluted | .29 | .24 | .22 | .23 | .21 | ||||||||||||||
Dividends declared per common share | $ | .05 | $ | .05 | $ | .05 | $ | .05 | $ | .05 | |||||||||
Financial highlights: | |||||||||||||||||||
Pre-tax pre-provision profit (1) | $ | 96,922 | $ | 87,545 | $ | 86,805 | $ | 93,555 | $ | 93,311 | |||||||||
Return on average assets (2) | 1.17 | % | 1.00 | % | .90 | % | .97 | % | .90 | % | |||||||||
Return on average common equity (2) | 10.99 | 9.35 | 8.39 | 9.28 | 8.39 | ||||||||||||||
Net interest margin (2) | 4.65 | 4.66 | 4.67 | 4.62 | 4.72 | ||||||||||||||
(1) Pre-tax pre-provision profit is calculated as total revenues less non-interest expense. | |||||||||||||||||||
(2) Annualized. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||||||
CONSOLIDATED QUARTERLY AVERAGE BALANCE SHEETS | |||||||||||||||||||
(In thousands) | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | |||||||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | |||||||||||||||
ASSETS | |||||||||||||||||||
Investments and other | $ | 623,721 | $ | 620,718 | $ | 663,572 | $ | 871,167 | $ | 729,514 | |||||||||
Securities held to maturity | 217,477 | 142,181 | 10,178 | 5,518 | 5,564 | ||||||||||||||
Securities available for sale: | |||||||||||||||||||
U.S. Government sponsored entities: | |||||||||||||||||||
Mortgage-backed securities, fixed rate | 408,000 | 467,747 | 625,156 | 638,418 | 654,968 | ||||||||||||||
U.S. Treasury securities | - | - | - | - | 494 | ||||||||||||||
Other securities | 75 | 80 | 84 | 110 | 93 | ||||||||||||||
Total securities available for sale | 408,075 | 467,827 | 625,240 | 638,528 | 655,555 | ||||||||||||||
Loans and leases held for sale | 240,304 | 195,871 | 193,164 | 156,593 | 116,390 | ||||||||||||||
Loans and leases: | |||||||||||||||||||
Consumer real estate: | |||||||||||||||||||
Fixed-rate | 3,393,788 | 3,498,832 | 3,584,072 | 3,678,665 | 3,809,066 | ||||||||||||||
Variable-rate | 2,710,998 | 2,828,980 | 2,828,110 | 2,723,947 | 2,621,619 | ||||||||||||||
Total consumer real estate | 6,104,786 | 6,327,812 | 6,412,182 | 6,402,612 | 6,430,685 | ||||||||||||||
Commercial: | |||||||||||||||||||
Fixed-rate | 1,515,353 | 1,559,991 | 1,592,418 | 1,765,172 | 1,833,144 | ||||||||||||||
Variable- and adjustable-rate | 1,615,967 | 1,562,075 | 1,496,106 | 1,517,708 | 1,503,262 | ||||||||||||||
Total commercial | 3,131,320 | 3,122,066 | 3,088,524 | 3,282,880 | 3,336,406 | ||||||||||||||
Leasing and equipment finance | 3,500,647 | 3,434,691 | 3,342,182 | 3,261,638 | 3,236,799 | ||||||||||||||
Inventory finance | 2,061,437 | 1,862,745 | 1,734,286 | 1,637,538 | 1,875,810 | ||||||||||||||
Auto finance | 1,518,194 | 1,327,232 | 1,157,586 | 973,418 | 823,102 | ||||||||||||||
Other | 12,040 | 13,273 | 13,369 | 12,299 | 13,060 | ||||||||||||||
Total loans and leases | 16,328,424 | 16,087,819 | 15,748,129 | 15,570,385 | 15,715,862 | ||||||||||||||
Total interest-earning assets | 17,818,001 | 17,514,416 | 17,240,283 | 17,242,191 | 17,222,885 | ||||||||||||||
Other assets | 1,123,148 | 1,094,923 | 1,074,655 | 1,060,409 | 1,110,213 | ||||||||||||||
Total assets | $ | 18,941,149 | $ | 18,609,339 | $ | 18,314,938 | $ | 18,302,600 | $ | 18,333,098 | |||||||||
LIABILITIES AND EQUITY | |||||||||||||||||||
Non-interest-bearing deposits: | |||||||||||||||||||
Retail | $ | 1,579,528 | $ | 1,537,066 | $ | 1,430,998 | $ | 1,435,958 | $ | 1,476,173 | |||||||||
Small business | 788,540 | 771,825 | 812,394 | 777,538 | 752,395 | ||||||||||||||
Commercial and custodial | 388,562 | 386,927 | 377,568 | 347,971 | 326,773 | ||||||||||||||
Total non-interest bearing deposits | 2,756,630 | 2,695,818 | 2,620,960 | 2,561,467 | 2,555,341 | ||||||||||||||
Interest-bearing deposits: | |||||||||||||||||||
Checking | 2,363,106 | 2,343,095 | 2,303,416 | 2,292,133 | 2,351,652 | ||||||||||||||
Savings | 5,887,133 | 6,120,155 | 6,197,411 | 6,238,462 | 6,059,640 | ||||||||||||||
Money market | 1,019,543 | 819,312 | 845,562 | 822,094 | 791,859 | ||||||||||||||
Subtotal | 9,269,782 | 9,282,562 | 9,346,389 | 9,352,689 | 9,203,151 | ||||||||||||||
Certificates of deposit | 2,742,832 | 2,543,345 | 2,392,896 | 2,401,811 | 2,360,881 | ||||||||||||||
Total interest-bearing deposits | 12,012,614 | 11,825,907 | 11,739,285 | 11,754,500 | 11,564,032 | ||||||||||||||
Total deposits | 14,769,244 | 14,521,725 | 14,360,245 | 14,315,967 | 14,119,373 | ||||||||||||||
Borrowings: | |||||||||||||||||||
Short-term borrowings | 220,042 | 97,996 | 8,333 | 6,545 | 7,314 | ||||||||||||||
Long-term borrowings | 1,368,480 | 1,494,095 | 1,486,189 | 1,609,211 | 1,879,576 | ||||||||||||||
Total borrowings | 1,588,522 | 1,592,091 | 1,494,522 | 1,615,756 | 1,886,890 | ||||||||||||||
Total interest-bearing liabilities | 13,601,136 | 13,417,998 | 13,233,807 | 13,370,256 | 13,450,922 | ||||||||||||||
Total deposits and borrowings | 16,357,766 | 16,113,816 | 15,854,767 | 15,931,723 | 16,006,263 | ||||||||||||||
Other liabilities | 541,458 | 508,689 | 508,253 | 455,911 | 420,398 | ||||||||||||||
Total liabilities | 16,899,224 | 16,622,505 | 16,363,020 | 16,387,634 | 16,426,661 | ||||||||||||||
Total TCF Financial Corporation stockholders' equity | 2,020,815 | 1,971,264 | 1,938,646 | 1,899,282 | 1,886,138 | ||||||||||||||
Non-controlling interest in subsidiaries | 21,110 | 15,570 | 13,272 | 15,684 | 20,299 | ||||||||||||||
Total equity | 2,041,925 | 1,986,834 | 1,951,918 | 1,914,966 | 1,906,437 | ||||||||||||||
Total liabilities and equity | $ | 18,941,149 | $ | 18,609,339 | $ | 18,314,938 | $ | 18,302,600 | $ | 18,333,098 |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | ||||||||||||||
CONSOLIDATED QUARTERLY YIELDS AND RATES (1) (2) | ||||||||||||||
(Unaudited) | ||||||||||||||
Jun. 30, | Mar. 31, | Dec. 31, | Sep. 30, | Jun. 30, | ||||||||||
2014 | 2014 | 2013 | 2013 | 2013 | ||||||||||
ASSETS | ||||||||||||||
Investments and other | 2.61 | % | 2.60 | % | 2.43 | % | 1.87 | % | 2.03 | % | ||||
Securities held to maturity | 2.65 | 2.71 | 3.66 | 4.15 | 4.47 | |||||||||
Securities available for sale: | ||||||||||||||
U.S. Government sponsored entities: | ||||||||||||||
Mortgage-backed securities, fixed-rate | 2.75 | 2.70 | 2.68 | 2.79 | 2.83 | |||||||||
U.S. Treasury securities | - | - | - | - | .07 | |||||||||
Other securities | 2.46 | 2.47 | 2.50 | 2.04 | 2.54 | |||||||||
Total securities available for sale (3) | 2.75 | 2.70 | 2.68 | 2.79 | 2.83 | |||||||||
Loans and leases held for sale | 8.35 | 8.24 | 7.28 | 7.51 | 8.74 | |||||||||
Loans and leases: | ||||||||||||||
Consumer real estate: | ||||||||||||||
Fixed-rate | 5.72 | 5.62 | 5.73 | 5.73 | 5.89 | |||||||||
Variable-rate | 5.14 | 5.13 | 5.13 | 5.10 | 5.13 | |||||||||
Total consumer real estate | 5.46 | 5.41 | 5.46 | 5.46 | 5.58 | |||||||||
Commercial: | ||||||||||||||
Fixed-rate | 5.16 | 5.07 | 5.16 | 5.36 | 5.25 | |||||||||
Variable- and adjustable-rate | 4.01 | 4.20 | 4.12 | 4.12 | 4.16 | |||||||||
Total commercial | 4.57 | 4.63 | 4.65 | 4.79 | 4.76 | |||||||||
Leasing and equipment finance | 4.72 | 4.75 | 4.89 | 4.94 | 4.94 | |||||||||
Inventory finance | 5.93 | 5.98 | 5.85 | 6.01 | 5.96 | |||||||||
Auto finance | 4.43 | 4.52 | 4.64 | 4.70 | 4.97 | |||||||||
Other | 7.63 | 7.41 | 7.78 | 8.34 | 8.10 | |||||||||
Total loans and leases | 5.10 | 5.11 | 5.17 | 5.22 | 5.29 | |||||||||
Total interest-earning assets | 4.97 | 4.97 | 4.99 | 4.98 | 5.08 | |||||||||
LIABILITIES | ||||||||||||||
Interest-bearing deposits: | ||||||||||||||
Checking | .04 | .05 | .05 | .06 | .06 | |||||||||
Savings | .16 | .17 | .17 | .23 | .18 | |||||||||
Money market | .43 | .28 | .29 | .28 | .28 | |||||||||
Subtotal | .16 | .15 | .15 | .19 | .16 | |||||||||
Certificates of deposit | .75 | .74 | .80 | .85 | .87 | |||||||||
Total interest-bearing deposits | .30 | .28 | .28 | .33 | .31 | |||||||||
Total deposits | .24 | .22 | .23 | .27 | .25 | |||||||||
Borrowings: | ||||||||||||||
Short-term borrowings | .26 | .33 | .96 | .59 | .44 | |||||||||
Long-term borrowings | 1.45 | 1.41 | 1.51 | 1.53 | 1.43 | |||||||||
Total borrowings | 1.29 | 1.34 | 1.50 | 1.52 | 1.42 | |||||||||
Total interest-bearing liabilities | .41 | .40 | .42 | .47 | .46 | |||||||||
Net interest margin | 4.65 | 4.66 | 4.67 | 4.62 | 4.72 | |||||||||
(1) Annualized. | ||||||||||||||
(2) Yields are presented on a fully tax-equivalent basis. | ||||||||||||||
(3) Average yields of securities available for sale are based upon the historical amortized cost and exclude equity securities. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (1) | |||||||
(Dollars in thousands) | |||||||
(Unaudited) | |||||||
At Jun. 30, | At Dec. 31, | ||||||
2014 | 2013 | ||||||
Computation of tangible common equity to tangible assets: | |||||||
Total equity | $ | 2,071,711 | $ | 1,964,759 | |||
Less: Non-controlling interest in subsidiaries | 16,805 | 11,791 | |||||
Total TCF Financial Corporation stockholders’ equity | 2,054,906 | 1,952,968 | |||||
Less: | |||||||
Preferred stock | 263,240 | 263,240 | |||||
Goodwill | 225,640 | 225,640 | |||||
Other intangibles | 5,483 | 6,326 | |||||
Tangible common equity | $ | 1,560,543 | $ | 1,457,762 | |||
Total assets | $ | 18,837,777 | $ | 18,379,840 | |||
Less: | |||||||
Goodwill | 225,640 | 225,640 | |||||
Other intangibles | 5,483 | 6,326 | |||||
Tangible assets | $ | 18,606,654 | $ | 18,147,874 | |||
Tangible common equity to tangible assets | 8.39 | % | 8.03 | % | |||
At Jun. 30, | At Dec. 31, | ||||||
2014 | 2013 | ||||||
Computation of tangible book value per common share: | |||||||
Tangible common equity | $ | 1,560,543 | $ | 1,457,762 | |||
Common stock shares outstanding | 166,881,460 | 165,122,295 | |||||
Tangible book value per common share | $ | 9.35 | $ | 8.83 | |||
At Jun. 30, | At Dec. 31, | ||||||
2014 | 2013 | ||||||
Computation of Tier 1 common capital ratio: | |||||||
Total Tier 1 capital | $ | 1,859,271 | $ | 1,763,682 | |||
Total risk-weighted assets | 16,085,019 | 15,455,706 | |||||
Total Tier 1 risk-based capital ratio | 11.56 | % | 11.41 | % | |||
Computation of Tier 1 common capital ratio: | |||||||
Total Tier 1 capital | $ | 1,859,271 | $ | 1,763,682 | |||
Less: | |||||||
Preferred stock | 263,240 | 263,240 | |||||
Qualifying non-controlling interest in subsidiaries | 16,805 | 11,791 | |||||
Total Tier 1 common capital | $ | 1,579,226 | $ | 1,488,651 | |||
Total Tier 1 common capital ratio | 9.82 | % | 9.63 | % | |||
(1) When evaluating capital adequacy and utilization, management considers financial measures such as tangible common equity to tangible assets, tangible book value per common share and the Tier 1 common capital ratio. These measures are non-GAAP financial measures and are viewed by management as useful indicators of capital levels available to withstand unexpected market or economic conditions, and also provide investors, regulators, and other users with information to be viewed in relation to other banking institutions. |
TCF FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (1), CONTINUED | |||||||||
(Dollars in thousands) | |||||||||
(Unaudited) | |||||||||
Three Months Ended | |||||||||
Jun. 30, | Mar. 31, | Jun. 30, | |||||||
2014 | 2014 | 2013 | |||||||
Computation of return on average tangible common equity: | |||||||||
Net income available to common shareholders | $ | 48,278 | $ | 39,910 | $ | 34,057 | |||
Other intangibles amortization, net of tax | 264 | 265 | 328 | ||||||
Adjusted net income available to common shareholders | 48,542 | 40,175 | 34,385 | ||||||
Average balances: | |||||||||
Total equity | $ | 2,041,925 | $ | 1,986,834 | $ | 1,906,437 | |||
Less: Non-controlling interest in subsidiaries | 21,110 | 15,570 | 20,299 | ||||||
Total TCF Financial Corporation stockholders’ equity | 2,020,815 | 1,971,264 | 1,886,138 | ||||||
Less: | |||||||||
Preferred stock | 263,240 | 263,240 | 263,240 | ||||||
Goodwill | 225,640 | 225,640 | 225,640 | ||||||
Other intangibles | 5,711 | 6,134 | 7,633 | ||||||
Tangible average common equity | $ | 1,526,224 | $ | 1,476,250 | $ | 1,389,625 | |||
Annualized return on average tangible common equity | 12.72% | 10.89% | 9.90% | ||||||
Six Months Ended Jun. 30, | |||||||||
2014 | 2013 | ||||||||
Computation of return on average tangible common equity: | |||||||||
Net income available to common shareholders | $ | 88,188 | $ | 59,507 | |||||
Other intangibles amortization, net of tax | 529 | 844 | |||||||
Adjusted net income available to common shareholders | 88,717 | 60,351 | |||||||
Average balances: | |||||||||
Total equity | $ | 2,013,728 | $ | 1,892,887 | |||||
Less: Non-controlling interest in subsidiaries | 18,355 | 18,539 | |||||||
Total TCF Financial Corporation stockholders’ equity | 1,995,373 | 1,874,348 | |||||||
Less: | |||||||||
Preferred stock | 263,240 | 263,240 | |||||||
Goodwill | 225,640 | 225,640 | |||||||
Other intangibles | 5,921 | 7,993 | |||||||
Tangible average common equity | $ | 1,500,572 | $ | 1,377,475 | |||||
Annualized return on average tangible common equity | 11.82% | 8.76% | |||||||
(1) When evaluating capital adequacy and utilization, management considers financial measures such as return on average tangible common equity. This measure is a non-GAAP financial measure and is viewed by management as a useful indicator of capital levels available to withstand unexpected market or economic conditions, and also provides investors, regulators, and other users with information to be viewed in relation to other banking institutions. |
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Contacts:
Investors:
Jason Korstange,
952-745-2755
or
Media:
Mark Goldman, 952-475-7050