TCF Financial Corporation ("TCF") (NYSE: TCB):

         
Earnings Summary       Table 1
($ in thousands, except per-share data)             Percent Change      
      4Q

2011

       3Q

2011

       4Q

2010

       4Q11 vs 3Q11       4Q11 vs 4Q10       YTD

2011

       YTD

2010

       Percent Change
Net income $

16,443

$ 32,255       $ 33,873

(49.0

)%      

(51.5

)% $

109,394

      $ 150,947      

(27.5

)%
Diluted earnings per common share

.10

.20 .24

(50.0

)

(58.3

)

.71

1.08

(34.3

)
 

Financial Ratios(1)

Return on average assets

.37

% .71 % .75 %

.61

% .85 %
Return on average common equity

3.55

7.12 9.09

6.32

10.67
Net interest margin 3.92 3.96 4.05 3.99 4.15
Net charge-offs as a percentage of 1.63 1.48 1.75 1.45 1.47
average loans and leases
 
(1) Annualized.
 

TCF Financial Corporation ("TCF") (NYSE: TCB) today reported net income for the fourth quarter of 2011 of $16.4 million, compared with $33.9 million in the fourth quarter of 2010 and $32.3 million in the third quarter of 2011. Diluted earnings per common share was 10 cents for the fourth quarter of 2011, compared with 24 cents in the fourth quarter of 2010 and 20 cents in the third quarter of 2011. As previously reported, TCF elected to change its method of accounting for defined benefit retirement plans in 2011. All prior periods have been retrospectively restated for this accounting change.

Net income for the year ended December 31, 2011 was $109.4 million, compared with $150.9 million for 2010. Diluted earnings per common share for the year ended December 31, 2011 was 71 cents, compared with $1.08 for 2010.

TCF declared a quarterly cash dividend of five cents per common share payable on February 29, 2012 to stockholders of record at the close of business on January 27, 2012.

Chairman's Statement

"TCF's 21st consecutive year of profitability was impacted in the fourth quarter by the full effect of the Durbin Amendment, start-up costs related to specialty finance and a sluggish economy," said William A. Cooper, Chairman and Chief Executive Officer. "Despite non-performing assets declining for a fifth consecutive quarter, credit quality remains a challenge in the current environment and is delaying TCF's return to more normal levels of provision. While the fourth quarter was not as profitable for us as other quarters during this economic cycle, we are excited about the strategic changes that have begun at TCF."

"As we begin the new year, we are encouraged by the potential for strong asset growth as we reposition TCF for the future. We will continue to implement various revenue-producing and expense reduction strategies throughout the company to mitigate the impact of the current regulatory changes as well as maintain our focus on working through potential problem loans to minimize credit costs. I am pleased with the new direction in which TCF is headed and optimistic about our ability to increase shareholder value in 2012."

       
Total Revenue     Table 2
    Percent Change            
($ in thousands)       4Q

2011

     3Q

2011

     4Q

2010

     4Q11 vs

3Q11

     4Q11 vs 4Q10     YTD

2011

     YTD

2010

     Percent Change
Net interest income $ 173,434       $ 176,064       $ 174,286   (1.5 )%     (.5 )% $ 699,688       $ 699,202   .1 %
Fees and other revenue:        
Fees and service charges 51,002 58,452 61,480 (12.7 ) (17.0 ) 219,363 273,181 (19.7 )
Card revenue 13,643 27,701 27,625 (50.7 ) (50.6 ) 96,147 111,067 (13.4 )
ATM revenue   6,608         7,523         6,985   (12.2 ) (5.4 )   27,927         29,836   (6.4 )
Total banking fees 71,253 93,676 96,090 (23.9 ) (25.8 ) 343,437 414,084 (17.1 )
Leasing and equipment 18,492 21,646 23,402 (14.6 ) (21.0 ) 89,167 89,194

  N.M.

finance
Other   1,570         786         817   99.7 92.2   3,434         5,584   (38.5 )
Total fees and other revenue   91,315         116,108         120,309   (21.4 ) (24.1 )   436,038         508,862   (14.3 )
Subtotal 264,749 292,172 294,595 (9.4 ) (10.1 ) 1,135,726 1,208,064 (6.0 )
Gains on securities, net 5,842 1,648 21,185 N.M. (72.4 ) 7,263 29,123 (75.1 )
Gains on sales of loans   1,133         -         -   N.M. N.M.   1,133         -  

  N.M.

Total revenue $ 271,724       $ 293,820       $ 315,780   (7.5 ) (14.0 ) $ 1,144,122       $ 1,237,187   (7.5 )
 
Net interest margin(1) 3.92 % 3.96 % 4.05 % 3.99 % 4.15 %
Fees and other revenue as
a % of total revenue 33.61 39.52 38.10 38.11 41.13
 
N.M. = Not meaningful.
(1) Annualized.                                                  
 

Net Interest Income

  • Net interest income for the fourth quarter of 2011 decreased $852 thousand, or .5 percent, compared with the fourth quarter of 2010 and $2.6 million, or 1.5 percent, compared with the third quarter of 2011. The decrease in net interest income from the fourth quarter of 2010 was primarily due to the following changes in loans and leases: reduced levels of higher yielding fixed-rate consumer real estate loans and decreases in leasing and equipment finance and commercial real estate portfolio balances and average yields, partially offset by reductions in the average deposit rates. The decrease in net interest income from the third quarter of 2011 was primarily due to the following changes in loans and leases: lower average balances in inventory finance, commercial real estate and consumer real estate loans.
  • Net interest margin in the fourth quarter of 2011 was 3.92 percent, compared with 4.05 percent in the fourth quarter of 2010 and 3.96 percent in the third quarter of 2011. The decrease in net interest margin from both periods was primarily due to increased asset liquidity and decreased levels of higher yielding loans and leases as a result of the lower interest rate environment. These changes were partially offset by a lower average cost of deposits and borrowings.
  • TCF maintained a high level of asset liquidity during the fourth quarter of 2011, which had an impact on net interest margin. Interest-bearing deposits held at the Federal Reserve and unencumbered securities were $1.4 billion at December 31, 2011, a decrease of $72 million from the third quarter of 2011 and an increase of $905 million from the fourth quarter of 2010. Our strong liquidity position reduced net interest margin percentage for the fourth quarter of 2011 by 15 basis points, compared with the fourth quarter of 2010, and by 2 basis points from the third quarter of 2011.

Non-interest Income

  • Banking fees and service charges in the fourth quarter of 2011 were $51 million, down $10.5 million, or 17 percent, from the fourth quarter of 2010 and down $7.5 million, or 12.7 percent, from the third quarter of 2011. The decline in banking fees and revenues from the fourth quarter of 2010 was primarily due to changes in customer behavior and increased levels of checking account attrition, some of which is in connection with new fees and service charges introduced in the fourth quarter of 2011. The decline from the third quarter of 2011 was primarily due to changes is customer behavior, a lower number of checking accounts and seasonality of items processed.
  • Card revenues were $13.6 million in the fourth quarter of 2011, down $14 million, or 50.6 percent, from the fourth quarter of 2010 and down $14.1 million, or 50.7 percent, from the third quarter of 2011. Compared with the fourth quarter of 2010 and third quarter of 2011, the average interchange rate per transaction decreased slightly more than 50 percent due to new debit card interchange regulations which took effect on October 1, 2011.
  • Leasing and equipment finance revenues were $18.5 million in the fourth quarter of 2011, down $4.9 million, or 21 percent, from the fourth quarter of 2010 and down $3.2 million, or 14.6 percent, from the third quarter of 2011. Decreases from both the fourth quarter of 2010 and the third quarter of 2011 were attributable to lower levels of customer initiated lease activity.
  • Subsequent to the acquisition of Gateway One Lending & Finance ("Gateway One") on November 30, 2011, TCF sold $37.4 million of auto loans and recognized $1.1 million in associated gains.

Loans and Leases

  
     
Average Loans and Leases   Table 3
          Percent Change      
($ in thousands)

4Q
2011

  

3Q
2011

  

4Q
2010

  

4Q11 vs
3Q11

  

4Q11 vs
4Q10

  

YTD
2011

  

YTD
2010

   Percent Change
Consumer real estate  
First mortgage lien $ 4,771,104 $ 4,808,881 $ 4,924,399 (.8 ) % (3.1 ) % $ 4,820,354 $ 4,934,257 (2.3 ) %
Junior lien   2,161,947     2,176,940     2,272,857 (.7 ) (4.9 )   2,192,927     2,296,400 (4.5 )
Total 6,933,051 6,985,821 7,197,256 (.8 ) (3.7 ) 7,013,281 7,230,657 (3.0 )
Consumer other   19,386     18,183     23,283 6.6 (16.7 )   19,687     26,577 (25.9 )
Total consumer 6,952,437 7,004,004 7,220,539 (.7 ) (3.7 ) 7,032,968 7,257,234 (3.1 )
Commercial 3,476,660 3,564,198 3,650,906 (2.5 ) (4.8 ) 3,565,085 3,687,024 (3.3 )
Leasing and
equipment finance 3,043,329 3,066,208 3,155,472 (.7 ) (3.6 ) 3,074,207 3,056,006 .6
Inventory finance   766,885     826,198     803,157 (7.2 ) (4.5 )   856,271     677,214 26.4
Total $ 14,239,311   $ 14,460,608   $ 14,830,074 (1.5 ) (4.0 ) $ 14,528,531   $ 14,677,478 (1.0 )
 
N.M. Not meaningful                    
 
  • Average consumer real estate loan balances decreased $264.2 million, or 3.7 percent, from the fourth quarter of 2010 and declined $52.8 million, or .8 percent, from the third quarter of 2011. Decreases reflect a decline in production of new loans, as marketplace yields available for fixed-rate loans are not as attractive to TCF versus variable-rate loans at their current levels.
  • Average fixed-rate consumer real estate loans decreased $346.5 million from the fourth quarter of 2010 and $64.7 million from the third quarter of 2011, while average variable-rate consumer real estate loans increased $82.3 million from the fourth quarter of 2010 and $11.9 million from the third quarter of 2011. Variable-rate loans comprised 35 percent of total consumer real estate loans at December 31, 2011, up from 33 percent at December 31, 2010 and 34.5 percent at September 30, 2011.
  • Average commercial loan balances in the fourth quarter of 2011 decreased $174.2 million, or 4.8 percent, from the fourth quarter of 2010 and decreased $87.5 million, or 2.5 percent, from the third quarter of 2011. The decreases for both periods were primarily due to higher levels of payments in excess of new origination volume.
  • Average leasing and equipment finance loan and lease balances in the fourth quarter of 2011 decreased $112.1 million, or 3.6 percent, from the fourth quarter of 2010 and $22.9 million, or .7 percent, from the third quarter of 2011. The decrease from both periods was primarily due to runoff of acquired portfolios, partially offset by growth in core market segments. Leasing and equipment finance originations of $1.5 billion during 2011 represent an increase of $224.2 million, or 17.8 percent, compared with 2010.
  • Average inventory finance loans were $766.9 million in the fourth quarter of 2011, a decrease of $36.3 million, or 4.5 percent, from the fourth quarter of 2010 and $59.3 million, or 7.2 percent, from the third quarter of 2011. The decrease from the fourth quarter of 2010 was primarily due to the termination of a lawn and garden program and the transitioning of an electronics and appliance program to a servicing-only program. The decrease from the third quarter of 2011 was primarily due to the termination of the lawn and garden program.
  • Gateway One provides strong growth potential due to the large auto lending marketplace (2nd largest consumer finance market in the U.S.). Auto loans, which are included in consumer other and loans and leases held for sale, are expected to grow throughout 2012 while Gateway One transitions from an originate-to-sell model to an originate-to-hold model. Gateway One increased its portfolio of managed loans, including loans held for investment, loans held for sale and loans sold and serviced, to $437.7 million at December 31, 2011 from $416.1 million at November 30, 2011.
  • TCF increased small business lending 2.5 percent since the fourth quarter of 2010 while small business lending across the U.S. declined 3.8 percent through the third quarter of 2011.

Credit Quality

(Table 4 - Credit Trends: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50141040&lang=en)

  • Overall favorable trends in non-performing assets continue and over 60-day delinquencies and net charge-offs remain below peak 2010 levels.
                   
Credit Quality Summary of Performing and Underperforming Loans and Leases               Table 5
        60+ Days          
($ in thousands) Performing Loans and Leases Delinquent and Accruing Non-accrual Total Loans
December 31, 2011: Non-classified   Classified(1)   Total   Accruing(2)       TDRs   Loans and Leases   and Leases
Consumer real estate and other $

6,271,575

  $ -   $

6,271,575

$

79,765

$

433,078

$ 149,386 $ 6,933,804
Commercial 2,987,876

234,501

3,222,377

1,148

99,448

127,519

3,449,492
Leasing and equipment finance 3,093,194 21,451 3,114,645 6,255 776 20,583 3,142,259
Inventory finance   616,677       7,040       623,717       160           -       823       624,700  

 

Total loans and leases

$

12,969,322

    $

262,992

    $

13,232,314

    $

87,328

        $

532,302

    $

298,311

    $ 14,150,255  
Percent of total loans and leases

91.6

% 1.9 %

93.5

% .6 % 3.8 %

2.1

% 100.0 %
                                 
60+ Days
Performing Loans and Leases Delinquent and Accruing Non-accrual Total Loans
September 30, 2011: Non-classified   Classified(1)   Total   Accruing(2)       TDRs   Loans and Leases   and Leases
Consumer real estate and other $ 6,405,059 $ - $ 6,405,059 $ 71,179 $ 378,773 $ 148,898 $ 7,003,909
Commercial 2,969,048 304,613 3,273,661 1,266 87,610 133,260 3,495,797
Leasing and equipment finance 2,953,215 28,574 2,981,789 4,709 860 24,437 3,011,795
Inventory finance   819,727       7,102       826,829       308           -       1,077       828,214  
Total loans and leases $ 13,147,049     $ 340,289     $ 13,487,338     $ 77,462         $ 467,243     $ 307,672     $ 14,339,715  
Percent of total loans and leases 91.7 % 2.4 % 94.1 % .5 % 3.3 % 2.1 % 100.0 %
                                     
60+ Days
Performing Loans and Leases Delinquent and Accruing Non-accrual Total Loans
December 31, 2010: Non-classified   Classified(1)   Total   Accruing(2)       TDRs   Loans and Leases   and Leases
Consumer real estate and other $ 6,613,610 $ - $ 6,613,610 $ 76,711 $ 337,401 $ 167,547 $ 7,195,269
Commercial 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 %
 
(1) Excludes classified loans and leases that are 60+ days delinquent and accruing or accruing TDRs.
(2) Excludes accruing TDRs that are 60+ days delinquent.
 

At December 31, 2011:

  • The combined balance of performing classified loans and leases, over 60-day delinquent and accruing loans and leases, accruing troubled debt restructurings ("TDR") and non-accrual loans and leases was $1.2 billion at December 31, 2011, a decrease of $11.7 million from September 30, 2011, down for the fourth consecutive quarter. This was primarily due to decreases in classified and non-accrual commercial real estate loans, partially offset by increases in accruing TDRs in both the commercial real estate and consumer real estate portfolios.
  • Over 60-day delinquency rate was .85 percent, up from .80 percent at December 31, 2010 and up from .75 percent at September 30, 2011. The increase from the fourth quarter of 2010 and from the third quarter of 2011 was primarily due to increases in consumer real estate first mortgage delinquencies, partially offset by decreases in commercial real estate delinquencies.
  • Total non-accrual loans and leases and other real estate owned (non-performing assets) were $433.2 million at December 31, 2011, a decrease of $53.1 million, or 10.9 percent, from December 31, 2010 and a decrease of $4.9 million, or 1.1 percent, from September 30, 2011, the fifth consecutive quarter of declining non-performing assets.
  • Non-accrual loans and leases were $298.3 million at December 31, 2011, a decrease of $46.9 million, or 13.6 percent, from December 31, 2010 and a decrease of $9.4 million, or 3 percent, from September 30, 2011. The decrease from December 31, 2010 was primarily due to a $28.6 million decrease in commercial and leasing and equipment finance non-accrual loans and leases as a result of fewer loans and leases entering non-accrual status and increased customer payments on commercial non-accrual loans in 2011, compared with 2010, and an $18.1 million decrease in consumer real estate non-accrual loans, as fewer loans were placed on non-accrual status and more loans returned to accrual status. The decrease from September 30, 2011 was primarily due to a $5.7 million decrease in commercial non-accrual loans as a result of increased customer payments received during the fourth quarter of 2011. TCF continues to experience improvements in non-accrual loan and lease balances as additions are down $72.1 million and loans returning to accrual status were up $29.3 million for the year ended December 31, 2011, compared with the prior year.
  • Other real estate owned was $134.9 million at December 31, 2011, a decrease of $6.2 million from December 31, 2010 and an increase of $4.5 million from September 30, 2011. The decrease from December 31, 2010 was primarily due to valuation writedowns on commercial real estate properties combined with a decrease in consumer properties. The increase from September 30, 2011 was primarily due to increased transfers from non-accrual to other real estate owned in commercial real estate during the fourth quarter of 2011.
  • Consumer real estate TDRs include loans where a payment modification (but not a reduction of principal) has been granted to a residential real estate customer. Performing consumer real estate TDRs have a weighted average yield of 3.7 percent, carry a 13.5 percent reserve and 7 percent are over 60-days delinquent at December 31, 2011.
  • Commercial TDRs include loans where a payment or other modification (but not a reduction of principal) has been granted. Performing commercial TDRs have a weighted average yield of 5.6 percent. There are no commercial TDRs over 60-days delinquent at December 31, 2011.
 

Allowance for Loan and Lease Losses

                                                             
Credit Quality Summary                                                       Table 6    
($ in thousands)                        
Percent Change
4Q 3Q 4Q 4Q11 vs 4Q11 vs YTD YTD Percent

Allowance for Loan and Lease Losses

2011       2011       2010       3Q11       4Q10         2011       2010       Change    
Balance at beginning of period $ 254,325 $ 255,472 $ 253,120 (0.4 ) % 0.5 % $ 265,819 $ 244,471 8.7
Charge-offs (62,973 ) (57,761 ) (69,913 ) 9.0 (9.9 ) (230,295 ) (237,063 ) (2.9 )
Recoveries 5,051   4,359   4,966   15.9 1.7 19,313   21,974   (12.1 )
Net charge-offs (57,922 ) (53,402 ) (64,947 ) 8.5 (10.8 ) (210,982 ) (215,089 ) (1.9 )
Provision for credit losses

59,249

52,315 77,646

13.3

(23.7

)

200,843

236,437

(15.1

)
Other 20   (60 ) -   N.M. N.M. (8 ) -   N.M.
Balance at end of period $

255,672

   $ 254,325   $ 265,819  

0.5

 

(3.8

) $

255,672

   $ 265,819  

(3.8

)
 
 
 

Net charge-offs as a percentage of average loans and leases(1)

 
Consumer real estate and other:
First mortgage lien 1.94 % 2.29 % 1.88 % (35 ) bps 6 bps 1.95 % 1.55 % 40 bps
Junior lien 2.63 2.99 2.37 (36 ) 26 2.69 2.33 36
Total consumer real estate 2.15 2.51 2.04 (36 ) 11 2.18 1.80 38
Total consumer real estate and other 2.23 2.59 2.10 (36 ) 13 2.23 1.86 37
Commercial 1.79 .57 2.04 122 (25 ) 1.15 1.31 (16 )
Leasing and equipment finance .46 .36 .99 10 (53 ) .41 1.00 (59 )
Inventory finance .03 .13 .28 (10 ) (25 ) .10 .17 (7 )
Total 1.63 1.48 1.75 15 (12 ) 1.45 1.47 (2 )
 
Allowance as a percentage of period end loans and leases

1.81

% 1.77 % 1.80 %

1.81

% 1.80 %
Ratio of allowance to net charge-offs (1) 1.1 X 1.2 X 1.0 X 1.2 X 1.2 X
 
N.M. = Not meaningful.
(1) Annualized.                                                            
 

At December 31, 2011:

  • Allowance for loan and lease losses was $255.7 million, or 1.81 percent of loans and leases, compared with $265.8 million, or 1.80 percent, at December 31, 2010 and $254.3 million, or 1.77 percent, at September 30, 2011.

For the quarter ended December 31, 2011:

  • Provision for credit losses was $59.2 million, down from $77.6 million in the fourth quarter of 2010 and up from $52.3 million recorded in the third quarter of 2011. The decrease from the fourth quarter of 2010 was primarily due to decreased net charge-offs and reserves in the commercial real estate and leasing and equipment finance portfolios. The increase from the third quarter of 2011 was primarily due to increased net charge-offs in the commercial portfolio.
  • Net loan and lease charge-offs were $57.9 million, or 1.63 percent, annualized, of average loans and leases, down from $64.9 million, or 1.75 percent, annualized, in the fourth quarter of 2010 and up from $53.4 million, or 1.48 percent, annualized, in the third quarter of 2011. The decrease from the fourth quarter of 2010 was primarily due to decreases in net charge-offs in commercial real estate and leasing and equipment finance, partially offset by increases in net charge-offs in consumer real estate. The increase from the third quarter of 2011 was primarily due to increases in commercial real estate net charge-offs on apartments, retail services, hotels and motels and commercial business net charge-offs.

Deposits

Average Deposits   Table 7
          Percent Change      
4Q 3Q 4Q 4Q11 vs   4Q11 vs YTD YTD Percent
($ in thousands) 2011   2011   2010   3Q11   4Q10   2011   2010   Change
 
Checking $ 4,449,640 $ 4,475,567 $ 4,358,771 (.6 )% 2.1 % $ 4,499,211 $ 4,408,853 2.0 %
Savings 5,878,392 5,812,187 5,412,094 1.1 8.6 5,692,324 5,429,416 4.8
Money market   662,024       650,598       643,801   1.8 2.8   658,693       656,691   .3
Subtotal 10,990,056 10,938,352 10,414,666 .5 5.5 10,850,228 10,494,960 3.4
Certificates   1,112,735       1,114,934       1,040,348   (.2 ) 7.0   1,103,231       1,054,179   4.7
Total deposits $ 12,102,791     $ 12,053,286     $ 11,455,014   .4 5.7 $ 11,953,459     $ 11,549,139   3.5
 
Total new checking accounts 94,321 119,616 71,225 (21.1 )% 32.4 % 431,677 418,670 3.1 %
Average interest rate on deposits (1) .32 % .39 % .46 % .38 % .53 %
 
(1) Annualized.                                  
 
  • Total average deposits increased $647.8 million, or 5.7 percent, from the fourth quarter of 2010 primarily due to increases in savings account balances and checking account production as a result of various targeted marketing campaigns. Average savings balances increased $466.3 million, or 8.6 percent, from the fourth quarter of 2010. Total new checking accounts increased 32.4 percent from the fourth quarter of 2010. Total average deposits increased $49.5 million, or .4 percent from the third quarter of 2011, primarily due to increases in average savings account balances, partially offset by seasonal decreases in checking account balances.
  • The average interest cost of deposits in the fourth quarter of 2011 was .32 percent, down 14 basis points from the fourth quarter of 2010 and down 7 basis points from the third quarter of 2011. The decrease from both periods was primarily due to pricing strategies on certain deposit products. The weighted average interest rate on deposits was .29 percent at December 31, 2011.

Non-interest Expense

   
Non-interest Expense Table 8
          Percent Change      
4Q 3Q 4Q 4Q11 vs   4Q11 vs YTD YTD Percent
($ in thousands) 2011   2011   2010   3Q11   4Q10   2011   2010   Change
Compensation and
employee benefits $ 82,595 $ 87,758 $ 82,843 (5.9 )% (.3 )% $ 348,792 $ 346,072 .8 %
Occupancy and equipment 32,366 31,129 30,968 4.0 4.5 126,437 126,551 (.1 )
FDIC insurance 6,647 7,363 7,398 (9.7 ) (10.2 ) 28,747 23,584 21.9
Deposit account premiums 6,482 7,045 1,688 (8.0 ) N.M. 22,891 17,304 32.3
Advertising and marketing 2,250 1,145 3,154 96.5 (28.7 ) 10,034 13,062 (23.2 )
Other   39,148       34,708     37,309 12.8 4.9   145,489     146,253 (.5 )
Core operating expenses 169,488 169,148 163,360 .2 3.8 682,390 672,826 1.4
Foreclosed real estate and
repossessed assets, net 11,323 12,430 12,781 (8.9 ) (11.4 ) 49,238 40,385 21.9
Operating lease depreciation 6,811 7,409 8,289 (8.1 ) (17.8 ) 30,007 37,106 (19.1 )
Other credit costs, net   (89 )     (139 )   1,542 36.0 N.M.   2,816     6,018 (53.2 )
Total non-interest expense $ 187,533     $ 188,848     $185,972 (.7 ) .8 $ 764,451   $ 756,335 1.1

N.M. = Not meaningful.

                                 
 
  • Compensation and employee benefits expense in the fourth quarter of 2011 was relatively flat with the fourth quarter of 2010 and decreased $5.2 million, or 5.9 percent, from the third quarter of 2011. Compensation and employee benefits expense increased $2.7 million, or .8 percent, in 2011 as compared with 2010. The slight change from the fourth quarter of 2010 was primarily due to compensation decreases in branch banking as a result of branch closures during 2011, offset by compensation related to increased headcount from the acquisition of Gateway One. The decrease from the third quarter of 2011 was primarily due to net gains recognized on the annual re-measurement of retirement benefit plan assets and liabilities during the fourth quarter of 2011. The increase for 2011 compared with 2010 was primarily due to an increase in commissions and incentives due to growth in the specialty finance business, which continued to expand its core business with new programs during 2011, the ramp up of expenses to deliver the onboarding of BRP that will begin funding early in 2012, and an increase in payroll taxes. These increases were partially offset by a decrease in employee medical costs and increased net gains recognized on retirement benefit plan assets and liabilities during the fourth quarter of 2011.
  • FDIC insurance expense decreased $751 thousand, or 10.2 percent, from the fourth quarter of 2010 and $716 thousand, or 9.7 percent, from the third quarter of 2011. FDIC insurance expense increased $5.2 million, or 21.9 percent, for the full year of 2011 from 2010. The decrease from the fourth quarter of 2010 and the third quarter of 2011 was primarily due to a decrease in the FDIC insurance rate as a result of increased liquidity during the fourth quarter of 2011. The increase for 2011 compared with 2010 was primarily due to changes in the FDIC insurance rate calculations for banks over $10 billion in total assets, which were implemented on April 1, 2011.
  • Deposit account premiums increased $4.8 million from the fourth quarter of 2010 and decreased $563 thousand, or 8 percent, from the third quarter of 2011. Deposit account premiums increased $5.6 million, or 32.3 percent, for the full year of 2011 from 2010. The increase from the fourth quarter of 2010 and for 2011 compared with 2010 was primarily due to changes in the account premium programs, beginning in April 2011 that increased the premiums paid for each qualifying account. The decrease from the third quarter of 2011 was primarily due to decreased production of checking accounts.
  • Advertising and marketing expense decreased $904 thousand, or 28.7 percent, from the fourth quarter of 2010 and increased $1.1 million, or 96.5 percent, from the third quarter of 2011. Advertising and marketing expense decreased $3 million, or 23.2 percent, for the full year of 2011 from 2010. The decrease from the fourth quarter of 2010 and for all of 2011 compared with 2010 was due to the discontinuation of the debit card rewards program in the third quarter of 2011 in response to new federal regulation regarding debit card interchange fees. The increase from the third quarter of 2011 was primarily due to the discontinuation of the debit card rewards program that was recognized in the third quarter of 2011.
  • Other non-interest expense increased $1.9 million, or 4.9 percent, from the fourth quarter of 2010 and $4.4 million, or 12.8 percent, from the third quarter of 2011. Other non-interest expense was flat for the full year of 2011 compared with 2010. The increase from the fourth quarter of 2010 was primarily due to an increase in card expenses related to our campus banking alliances. The increase from the third quarter of 2011 was primarily due to an increase in transaction costs related to the acquisition of Gateway One.
  • Foreclosed real estate and repossessed asset expense decreased $1.5 million, or 11.4 percent, from the fourth quarter of 2010 and decreased $1.1 million, or 8.9 percent, from the third quarter of 2011. Foreclosed real estate and repossessed asset expense increased $8.9 million, or 21.9 percent, for the full year of 2011 from 2010. The decrease from the fourth quarter of 2010 was primarily due to a decrease in the number of consumer real estate properties owned and the associated expenses. The decrease from the third quarter of 2011 was primarily due to reduced writedowns on commercial real estate properties owned. The increase for 2011 compared with 2010 was primarily due to increased valuation writedowns per property on commercial real estate properties.

 

   

 

       

 

Capital and Borrowing Capacity

               

Capital Information

            

Table 9

At period end

($ in thousands, except per-share data)

4Q 2011

4Q 2010

 
Total equity $

1,878,627

$ 1,480,163
Total equity to total assets

9.90

% 8.02 %
Book value per common share $

11.65

$ 10.30
Tangible realized common equity to tangible assets(1)

8.42

% 7.28 %
 
 
Risk-based capital
Tier 1 $

1,706,926

12.67

% $ 1,459,703 10.47 %
Total

1,994,875

14.80

1,792,683 12.86
Excess over stated "10% well-capitalized" requirement

647,342

4.80

399,020 2.86
 
Tier 1 Leverage Capital $

1,706,926

9.15

% $ 1,459,703 7.91 %
 
Tier 1 common capital(2) $

1,581,432

11.74

% $ 1,336,203 9.59 %
 
 

(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, 2011 of $2 billion, or 14.80 percent of risk-weighted assets, was $647.3 million in excess of the stated "10 percent well-capitalized" requirement.
  • The tier 1 leverage ratio and tier 1 common risk-based capital ratio decreased from 9.42 percent and 12.11 percent, respectively, at September 30, 2011 to 9.15 percent and 11.74 percent, respectively, at December 31, 2011 due mainly to the addition of goodwill and intangible assets acquired in the purchase of Gateway One.
  • On January 16, 2012, the Board of Directors of TCF declared a regular quarterly cash dividend of five cents per common share payable on February 29, 2012 to stockholders of record at the close of business on January 27, 2012.
  • At December 31, 2011, TCF had $1.9 billion in unused, secured borrowing capacity at the FHLB of Des Moines and $518 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, http://ir.tcfbank.com, on January 24, 2012 at 10:00 a.m. CT. 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, quarterly reports, investor presentations and SEC filings.

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TCF is a Wayzata, Minnesota-based national bank holding company with $19 billion in total assets. TCF has 434 branches 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, commercial inventory finance business in the U.S. and Canada, and indirect auto finance business in over 30 states. For more information about TCF, please visit www.tcfbank.com.

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Forward-Looking Information

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 in this release. These factors include the factors discussed in Part I, Item 1A of the Company's Annual Report on Form 10-K 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, Credit and Other Risks Deterioration in general economic and banking industry conditions, including 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, deposit outflows, deposit account attrition or an inability to increase the number of deposit accounts; 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 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; 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; limitations on TCF's ability to attract and retain manufacturers and dealers to expand the inventory finance business.

Legislative and Regulatory Requirements New consumer protection and supervisory requirements and regulations, including those resulting from action by the CFPB and changes in the scope of Federal preemption of 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 Dodd-Frank 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 Durbin Amendment to the Dodd-Frank Act; 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; 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; 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.

Earnings/Capital Risks and 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 Act 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 Dodd-Frank Act, or 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; uncertainties relating to customer opt-in preferences with respect to NSF fees on point of sale and ATM transactions 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.

Competitive Conditions; Supermarket Branching Risk; Growth Risks 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; customers completing financial transactions without using a bank; the effect of any negative publicity; 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 our balance sheet through programs or new opportunities; failure to successfully attract and retain new customers.

Technological and Operational Matters Technological or operational difficulties, loss or theft of information, 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, 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 state or Federal 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
December 31, Change
  2011   2010   $ %
Interest income:
Loans and leases $ 205,415 $ 220,772 $ (15,357) (7.0) %
Securities available for sale 22,559 18,072 4,487 24.8
Investments and other   2,333   1,900   433 22.8
Total interest income   230,307   240,744   (10,437) (4.3)
Interest expense:
Deposits 9,791 13,370 (3,579) (26.8)
Borrowings   47,082   53,088   (6,006) (11.3)
Total interest expense   56,873   66,458   (9,585) (14.4)
Net interest income 173,434 174,286 (852) (.5)
Provision for credit losses  

59,249

   77,646  

(18,397)

(23.7)

Net interest income after provision for
credit losses  

114,185

   96,640  

17,545

18.2

Non-interest income:
Fees and service charges 51,002 61,480 (10,478) (17.0)
Card revenue 13,643 27,625 (13,982) (50.6)
ATM revenue   6,608   6,985   (377) (5.4)
Subtotal 71,253 96,090 (24,837) (25.8)
Leasing and equipment finance 18,492 23,402 (4,910) (21.0)
Other   1,570   817   753 92.2
Fees and other revenue 91,315 120,309 (28,994) (24.1)
Gains on securities, net 5,842 21,185 (15,343) (72.4)
Gains on sales of auto loans   1,133   -   1,133 N.M.
Total non-interest income   98,290   141,494   (43,204) (30.5)
Non-interest expense:
Compensation and employee benefits 82,595 82,843 (248) (.3)
Occupancy and equipment 32,366 30,968 1,398 4.5
FDIC insurance 6,647 7,398 (751) (10.2)
Deposit account premiums 6,482 1,688 4,794 N.M.
Advertising and marketing 2,250 3,154 (904) (28.7)
Other   39,148   37,309   1,839 4.9
Subtotal 169,488 163,360 6,128 3.8
Foreclosed real estate and repossessed assets, net 11,323 12,781 (1,458) (11.4)
Operating lease depreciation 6,811 8,289 (1,478) (17.8)
Other credit costs, net   (89)   1,542   (1,631) (105.8)
Total non-interest expense   187,533   185,972   1,561 .8
Income before income tax expense

24,942

52,162

(27,220)

(52.2)

Income tax expense  

7,424

   17,391  

(9,967)

(57.3)

Income after income tax expense

17,518

34,771

(17,253)

(49.6)

Income attributable to non-controlling interest   1,075   898   177 19.7
Net income available to common stockholders $

16,443

$ 33,873 $

(17,430)

(51.5)

 
Net income per common share:
Basic $

.10

$ .24 $

(.14)

(58.3)

Diluted

.10

.24

(.14)

(58.3)

 
Dividends declared per common share $ .05 $ .05 $ - -
 
Average common and common equivalent
shares outstanding (in thousands):
Basic 157,829 140,970 16,859 12.0
Diluted 158,152 141,216 16,936 12.0
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
                   
 
Year Ended
December 31, Change
  2011   2010   $ %
Interest income:
Loans and leases $ 844,796 $ 883,923 $ (39,127) (4.4) %
Securities available for sale 85,188 80,445 4,743 5.9
Investments and other   7,967   5,509   2,458 44.6
Total interest income   937,951   969,877   (31,926) (3.3)
Interest expense:
Deposits 45,108 61,229 (16,121) (26.3)
Borrowings   193,155   209,446   (16,291) (7.8)
Total interest expense   238,263   270,675   (32,412) (12.0)
Net interest income 699,688 699,202 486 .1
Provision for credit losses  

200,843

   236,437  

(35,594)

(15.1)

Net interest income after provision for
credit losses  

498,845

   462,765  

36,080

7.8

Non-interest income:
Fees and service charges 219,363 273,181 (53,818) (19.7)
Card revenue 96,147 111,067 (14,920) (13.4)
ATM revenue   27,927   29,836   (1,909) (6.4)
Subtotal 343,437 414,084 (70,647) (17.1)
Leasing and equipment finance 89,167 89,194 (27) N.M.
Other   3,434   5,584   (2,150) (38.5)
Fees and other revenue 436,038 508,862 (72,824) (14.3)
Gains on securities, net 7,263 29,123 (21,860) (75.1)
Gains on sales of auto loans   1,133   -   1,133 N.M.
Total non-interest income   444,434   537,985   (93,551) (17.4)
Non-interest expense:
Compensation and employee benefits 348,792 346,072 2,720 .8
Occupancy and equipment 126,437 126,551 (114) (.1)
FDIC insurance 28,747 23,584 5,163 21.9
Deposit account premiums 22,891 17,304 5,587 32.3
Advertising and marketing 10,034 13,062 (3,028) (23.2)
Other   145,489   146,253   (764) (.5)
Subtotal 682,390 672,826 9,564 1.4
Foreclosed real estate and repossessed assets, net 49,238 40,385 8,853 21.9
Operating lease depreciation 30,007 37,106 (7,099) (19.1)
Other credit costs, net   2,816   6,018   (3,202) (53.2)
Total non-interest expense   764,451   756,335   8,116 1.1
Income before income tax expense

178,828

244,415

(65,587)

(26.8)

Income tax expense  

64,441

   90,171  

(25,730)

(28.5)

Income after income tax expense

114,387

154,244

(39,857)

(25.8)

Income attributable to non-controlling interest   4,993   3,297   1,696 51.4
Net income available to common stockholders $

109,394

$ 150,947 $

(41,558)

(27.5)

 
Net income per common share:
Basic $

.71

$ 1.08 $

(.37)

(34.3)

Diluted

.71

1.08

(.37)

(34.3)

 
Dividends declared per common share $ .20 $ .20 $ - -
 
Average common and common equivalent
shares outstanding (in thousands):
Basic 154,222 138,617 15,605 11.3
Diluted 154,509 138,813 15,696 11.3
 
N.M. Not meaningful.
 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per-share data)
(Unaudited)
                 
 
At At Change
December 31, December 31,
2011 2010 $ %
ASSETS
 
Cash and due from banks $ 1,389,704 $ 663,901 $ 725,803 % 109.3 %
Investments 157,780 179,768 (21,988) (12.2)
Securities available for sale 2,324,038 1,931,174 392,864 20.3
Loans and leases held for sale 14,321 - 14,321 N.M.
Loans and leases: -
Consumer real estate and other 6,933,804 7,195,269 (261,465) (3.6)
Commercial 3,449,492 3,646,203 (196,711) (5.4)
Leasing and equipment finance 3,142,259 3,154,478 (12,219) (.4)
Inventory finance 624,700 792,354 (167,654) (21.2)
Total loans and leases 14,150,255 14,788,304 (638,049) (4.3)
Allowance for loan and lease losses

(255,672)

(265,819)

10,147

3.8

Net loans and leases

13,894,583

14,522,485

(672,902)

(4.3)
Premises and equipment, net 436,281 443,768 (7,487) (1.7)
Goodwill 225,640 152,599 73,041 47.9
Other assets

537,041

571,330

(34,289)

(6.0)

Total assets

$ 18,979,388

$ 18,465,025

514,363

2.8
 
LIABILITIES AND EQUITY
 
Deposits:
Checking $ 4,629,749 $ 4,530,064 $ 99,685 2.2
Savings 5,855,263 5,390,802 464,461 8.6
Money market 651,377 635,922 15,455 2.4
Subtotal 11,136,389 10,556,788 579,601 5.5
Certificates of deposit 1,065,615 1,028,327 37,288 3.6
Total deposits 12,202,004 11,585,115 616,889 5.3
Short-term borrowings 6,416 126,790 (120,374) (94.9)
Long-term borrowings 4,381,664 4,858,821 (477,157) (9.8)
Total borrowings 4,388,080 4,985,611 (597,531) (12.0)
Accrued expenses and other liabilities 510,677 414,136 96,541 23.3
Total liabilities 17,100,761 16,984,862 115,899 .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; 160,366,380,
and 142,965,012 shares issued 1,604 1,430 174 12.2
Additional paid-in capital 715,247 459,884 255,363 55.5
Retained earnings, subject to certain restrictions

1,127,823

1,049,156

78,667

7.5

Accumulated other comprehensive income (loss) 56,826 (15,692) 72,518 N.M.
Treasury stock at cost, 42,566, and 51,160
shares, and other (33,367) (23,115) (10,252) (44.4)
Total TCF Financial Corp. stockholders' equity

1,868,133

1,471,663

396,470

26.9

Non-controlling interest in subsidiaries 10,494 8,500 1,994 23.5
Total equity

1,878,627

1,480,163

398,464

26.9

Total liabilities and equity

$ 18,979,388

$ 18,465,025

514,363

2.8
 
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
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Dec. 31,
2011 2011 2011 2011 2010 2011 2010

Delinquency Data - Principal Balances(1)

60 days or more:
Consumer real estate
First mortgage lien $ 87,358 $ 78,241 $ 74,090 $ 70,024 $ 73,848 $ 9,117 $ 13,510
Junior lien 22,277 18,499 17,780 19,528 20,763 3,778 1,514
Total consumer real estate 109,635 96,740 91,870 89,552 94,611 12,895 15,024
Consumer other 41 58 171 78 39 (17) 2
Total consumer real estate and other 109,676 96,798 92,041 89,630 94,650 12,878 15,026
Commercial 1,148 3,079 6,238 1,864 9,021 (1,931) (7,873)
Leasing and equipment finance 3,512 2,840 2,447 5,274 5,054 672 (1,542)
Inventory finance 160 306 145 240 318 (146) (158)
Subtotal 114,496 103,023 100,871 97,008 109,043 11,473 5,453
Acquired portfolios 3,140 1,870 2,993 4,399 6,000 1,270 (2,860)
Total delinquencies $ 117,636 $ 104,893 $ 103,864 $ 101,407 $ 115,043 $ 12,743 $ 2,593
 

Delinquency Data - % of Portfolio(1)

60 days or more:
Consumer real estate
First mortgage lien 1.89 % 1.68 % 1.58 % 1.48 % 1.55 % 21 bps 34 bps
Junior lien 1.04 .86 .82 .89 .93 18 11
Total consumer real estate 1.63 1.42 1.34 1.30 1.35 21 28
Consumer other .12 .18 .46 .22 .10 (6) 2
Total consumer real estate and other 1.62 1.41 1.33 1.29 1.35 21 27
Commercial .03 .09 .18 .05 .26 (6) (23)
Leasing and equipment finance .13 .11 .09 .20 .19 2 (6)
Inventory finance .03 .04 .02 .03 .05 (1) (2)
Subtotal .85 .75 .73 .69 .79 10 6
Acquired portfolios .84 .51 .70 .89 1.00 33 (16)
Total delinquencies .85 .75 .73 .70 .80 10 5
 
(1) Excludes non-accrual loans and leases.
 
At At At At At Change from
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30, Dec. 31,
2011 2011 2011 2011 2010 2011 2010

Non-Accrual Loans and Leases

Non-accrual loans and leases:
Consumer real estate
First mortgage lien $ 129,114 $ 130,671 $ 129,837 $ 133,865 $ 140,871 $ (1,557) $ (11,757)
Junior lien 20,257 18,223 21,069 21,325 26,626 2,034 (6,369)
Total consumer real estate 149,371 148,894 150,906 155,190 167,497 477 (18,126)
Consumer other 15 4 32 43 50 11 (35)
Total consumer real estate and other 149,386 148,898 150,938 155,233 167,547 488 (18,161)
Commercial

127,519

133,260 140,407 127,745 142,248

(5,741)

(14,729)

Leasing and equipment finance 20,583 24,437 29,682 34,634 34,407 (3,854) (13,824)
Inventory finance 823 1,077 634 1,437 1,055 (254) (232)
Total non-accrual loans and leases

$ 298,311

$ 307,672 $ 321,661 $ 319,049 $ 345,257

$ (9,361)

$ (46,946)

 
Non-accrual loans and leases - rollforward
Balance, beginning of period $ 307,672 $ 321,661 $ 319,049 $ 345,257 $ 369,812 $ (13,989) $ (62,140)
Additions

125,893

80,014 86,996 80,596 92,180

45,879

33,713

Charge-offs

(38,263)

(29,338) (22,401) (37,417) (43,092)

(8,925)

4,829

Transfers to other assets

(31,486)

(21,654) (27,078) (33,541) (41,659)

(9,832)

10,173

Return to accrual status (19,932) (20,272) (21,985) (24,634) (17,989) 340 (1,943)
Payments received (45,238) (23,843) (14,383) (12,881) (15,036) (21,395) (30,202)
Other, net (335) 1,104 1,463 1,669 1,041 (1,439) (1,376)
Balance, end of period

$ 298,311

$ 307,672 $ 321,661 $ 319,049 $ 345,257

$ (9,361)

$ (46,946)

 
Charge-offs and allowance recorded on
non-accrual loans and leases as a percentage
of contractual balance
Consumer real estate 29.9 % 29.3 % 26.6 % 24.5 % 22.0 % 60 bps 790 bps
Commercial

37.2

34.3 37.9 40.5 43.1

290

(590)

Leasing and equipment finance 17.7 22.1 20.5 23.6 24.3 (440) (660)
Inventory finance 5.3 5.7 11.8 7.1 17.5 (40) (1,220)
Total

32.4

31.0 31.4 31.4 31.6

140

80

 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
SUMMARY OF CREDIT QUALITY DATA, CONTINUED
(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,
2011 2011 2011 2011 2010 2011 2010
Other Real Estate Owned
Other real estate owned (1):
Consumer real estate $ 87,792 $ 88,206 $ 94,311 $ 97,976 $ 90,115 $ (414) $ (2,323)
Commercial real estate   47,106   42,207   42,188   44,178   50,950   4,899   (3,844)
Total other real estate owned $ 134,898 $ 130,413 $ 136,499 $ 142,154 $ 141,065 $ 4,485 $ (6,167)
 
Other real estate owned - rollforward
Balance, beginning of period $ 130,413 $ 136,499 $ 142,154 $ 141,065 $ 136,144 $ (6,086) $ (5,731)
Transferred in

33,864

24,939 27,649 35,480 44,513

8,925

(10,649)

Sales

(25,909)

(26,095) (28,759) (31,328) (34,666)

186

8,757

Writedowns

(5,719)

(6,337) (6,741) (6,266) (6,220)

618

501

Other, net  

2,249

   1,407   2,196   3,203   1,294  

842

  

955

Balance, end of period $ 134,898 $ 130,413 $ 136,499 $ 142,154 $ 141,065 $ 4,485 $ (6,167)
 
Charge-offs and writedowns recorded on other real
estate owned as a percentage of contractual
loan balance prior to non-performing status
Consumer 36.0 % 35.1 % 33.1 % 32.2 % 33.0 % 90 bps 300 bps
Commercial 43.2 42.7 33.2 24.5 26.6 50 1,660
Total 38.7 37.8 33.1 30.0 30.8 90 790
 
Ending number of properties owned
Consumer real estate 465 456 488 493 520 9 (55)
Commercial real estate   33   33   26   26   28   -   5
Total   498   489   514   519   548   9   (50)
 
(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 December 31, At September 30, At December 31,
2011 2011 2010 Change from
% of % of % of

Sep. 30,

Dec. 31,

Balance Portfolio   Balance Portfolio   Balance Portfolio   2011 2010
Consumer real estate

$ 183,435

2.66

% $ 177,430 2.55 % $ 172,850 2.42 %

11

bps

24

bps
Consumer other 1,114

2.89

1,219 3.68 1,653 4.22

(79)

(133)

Total consumer real estate and other

184,549

2.66

178,649 2.55 174,503 2.43

11

23

Commercial

46,954

1.36

49,499 1.42 62,478 1.71

(6)

(35)

Leasing and equipment finance 21,173 .67 23,300 .77 26,301 .83 (10) (16)
Inventory finance 2,996 .48 2,877 .35 2,537 .32 13 16
Total

$ 255,672

1.81

$ 254,325 1.77 $ 265,819 1.80

4

1

 
 

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,
2011 2011 2011 2011 2010 2011 2010
Consumer real estate
First mortgage lien 1.94 % 2.29 % 1.78 % 1.81 % 1.88 % (35) bps 6 bps
Junior lien 2.63 2.99 2.75 2.39 2.37 (36) 26
Total consumer real estate 2.15 2.51 2.09 1.99 2.04 (36) 11
Total consumer real estate and other 2.23 2.59 2.12 1.97 2.10 (36) 13
Commercial 1.79 .57 .30 1.96 2.04 122 (25)
Leasing and equipment finance .46 .36 .45 .36 .99 10 (53)
Inventory finance .03 .13 .13 .10 .28 (10) (25)
Total 1.63 1.48 1.19 1.51 1.75 15 (12)
 
(1) Annualized.
 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
                             
Three Months Ended December 31,
2011 2010
Average Yields and Average Yields and
Balance Interest Rates (1) Balance Interest Rates (1)
ASSETS:
Investments and other $ 1,046,883 $ 2,202 .84 % $ 406,351 $ 1,900 1.86 %
U.S. Government sponsored entities:
Mortgage-backed securities, fixed-rate 2,381,193 22,557 3.79 1,729,928 18,005 4.16
U.S. Treasury securities - - - 198,895 63 .13
Other securities 237 2 3.36 431 4 3.69
Total securities available for sale(2) 2,381,430 22,559 3.79 1,929,254 18,072 3.75
Loans and leases held for sale 4,822 131 10.78 - - -
Loans and leases:
Consumer real estate:
Fixed-rate 4,528,165 68,919 6.04 4,874,633 74,961 6.10
Variable-rate 2,404,886 30,841 5.09 2,322,623 30,735 5.25
Consumer - other 19,386 415 8.49 23,283 537 9.15
Total consumer real estate and other 6,952,437 100,175 5.72 7,220,539 106,233 5.84
Commercial:
Fixed- and adjustable-rate 2,775,219 39,734 5.68 2,947,137 43,856 5.90
Variable-rate 701,441 7,569 4.28 703,769 7,373 4.16
Total commercial 3,476,660 47,303 5.40 3,650,906 51,229 5.57
Leasing and equipment finance 3,043,329 44,762 5.88 3,155,472 49,212 6.24
Inventory finance 766,885 13,767 7.12 803,157 14,554 7.19
Total loans and leases 14,239,311 206,007 5.75 14,830,074 221,228 5.93
Total interest-earning assets 17,672,446 230,899 5.20 17,165,679 241,200 5.59
Other assets 1,248,000 1,443,559
Total assets $ 18,920,446 $ 18,609,238
 
LIABILITIES AND EQUITY:
Non-interest bearing deposits:
Retail $ 1,330,462 $ 1,366,190
Small business 738,867 676,670
Commercial and custodial 303,216 291,295
Total non-interest bearing deposits 2,372,545 2,334,155
Interest-bearing deposits:
Checking 2,096,340 818 .15 2,044,060 1,475 .29
Savings 5,859,147 6,254 .42 5,392,650 8,592 .63
Money market 662,024 620 .37 643,801 1,043 .64
Subtotal 8,617,511 7,692 .35 8,080,511 11,110 .55
Certificates of deposit 1,112,735 2,099 .75 1,040,348 2,260 .86
Total interest-bearing deposits 9,730,246 9,791 .40 9,120,859 13,370 .58
Total deposits 12,102,791 9,791 .32 11,455,014 13,370 .46
Borrowings:
Short-term borrowings 37,081 27 .29 235,219 209 .35
Long-term borrowings 4,387,036 47,055 4.26 4,746,823 52,879 4.42
Total borrowings 4,424,117 47,082 4.23 4,982,042 53,088 4.23
Total interest-bearing liabilities 14,154,363 56,873 1.59 14,102,901 66,458 1.87
Total deposits and borrowings 16,526,908 56,873 1.37 16,437,056 66,458 1.61
Other liabilities 538,148 674,827
Total liabilities 17,065,056 17,111,883
Total TCF Financial Corp. stockholders' equity 1,850,968 1,490,025
Non-controlling interest in subsidiaries 4,422 7,330
Total equity 1,855,390 1,497,355
Total liabilities and equity $ 18,920,446 $ 18,609,238
Net interest income and margin $ 174,026 3.92 % $ 174,742 4.05 %
 
(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,
2011   2010
Average Yields and Average Yields and
Balance Interest Rates Balance Interest Rates
ASSETS:
Investments and other $ 820,981 $ 7,836 .95 % $ 337,279 $ 5,509 1.63 %
U.S. Government sponsored entities:
Mortgage-backed securities, fixed-rate 2,198,188 85,138 3.87 1,817,413 80,332 4.42
U.S. Treasury securities 48,178 34 .07 71,233 93 .13
Other securities 329 16 4.86 454 20 4.41
Total securities available for sale(1) 2,246,695 85,188 3.79 1,889,100 80,445 4.26
Loans and leases held for sale 1,215 131 10.78 - - -
Loans and leases:
Consumer real estate:
Fixed-rate 4,627,047 281,427 6.08 5,082,487 313,573 6.17
Variable-rate 2,386,234 122,532 5.13 2,148,171 116,436 5.42
Consumer - other 19,687 1,715 8.71 26,576 2,303 8.67
Total consumer real estate and other 7,032,968 405,674 5.77 7,257,234 432,312 5.96
Commercial:
Fixed- and adjustable-rate 2,854,327 164,368 5.76 2,956,699 176,018 5.95
Variable-rate 710,758 30,742 4.33 730,325 30,604 4.19
Total commercial 3,565,085 195,110 5.47 3,687,024 206,622 5.60
Leasing and equipment finance 3,074,207 184,575 6.00 3,056,006 196,570 6.43
Inventory finance 856,271 61,583 7.19 677,214 49,881 7.37
Total loans and leases 14,528,531 846,942 5.83 14,677,478 885,385 6.03
Total interest-earning assets 17,597,422 940,097 5.34 16,903,857 971,339 5.75
Other assets 1,194,550 1,286,683
Total assets $ 18,791,972 $ 18,190,540
 
LIABILITIES AND EQUITY:
Non-interest bearing deposits:
Retail $ 1,414,659 $ 1,429,436
Small business 698,903 641,412
Commercial and custodial 291,986 284,750
Total non-interest bearing deposits 2,405,548 2,355,598
Interest-bearing deposits:
Checking 2,114,098 4,451 .21 2,071,990 6,466 .31
Savings 5,671,889 28,942 .51 5,410,681 40,023 .74
Money market 658,693 2,951 .45 656,691 4,532 .69
Subtotal 8,444,680 36,344 .43 8,139,362 51,021 .63
Certificates of deposit 1,103,231 8,764 .79 1,054,179 10,208 .97
Total interest-bearing deposits 9,547,911 45,108 .47 9,193,541 61,229 .67
Total deposits 11,953,459 45,108 .38 11,549,139 61,229 .53
Borrowings:
Short-term borrowings 49,442 171 .35 124,891 474 .38
Long-term borrowings 4,500,564 192,984 4.29 4,580,786 208,972 4.56
Total borrowings 4,550,006 193,155 4.24 4,705,677 209,446 4.45
Total interest-bearing liabilities 14,097,917 238,263 1.69 13,899,218 270,675 1.95
Total deposits and borrowings 16,503,465 238,263 1.44 16,254,816 270,675 1.66
Other liabilities 551,206 511,589
Total liabilities 17,054,671 16,766,405
Total TCF Financial Corp. stockholders' equity 1,729,660 1,415,161
Non-controlling interest in subsidiaries 7,641 8,974
Total equity 1,737,301 1,424,135
Total liabilities and equity $ 18,791,972 $ 18,190,540
Net interest income and margin $ 701,834 3.99 % $ 700,664 4.15 %
 
(1) 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,
2011 2011 2011 2011 2010
Interest income:
Loans and leases $ 205,415 $ 210,885 $ 213,823 $ 214,673 $ 220,772
Securities available for sale 22,559 22,561 20,639 19,429 18,072
Investments and other 2,333 1,997 1,836 1,801 1,900
Total interest income 230,307 235,443 236,298 235,903 240,744
Interest expense:
Deposits 9,791 11,883 11,430 12,004 13,370
Borrowings 47,082 47,496 48,718 49,859 53,088
Total interest expense 56,873 59,379 60,148 61,863 66,458
Net interest income 173,434 176,064 176,150 174,040 174,286
Provision for credit losses

59,249

52,315 44,005 45,274 77,646
Net interest income after provision for
credit losses

114,185

123,749 132,145 128,766 96,640
Non-interest income:
Fees and service charges 51,002 58,452 56,396 53,513 61,480
Card revenue 13,643 27,701 28,219 26,584 27,625
ATM revenue 6,608 7,523 7,091 6,705 6,985
Subtotal 71,253 93,676 91,706 86,802 96,090
Leasing and equipment finance 18,492 21,646 22,279 26,750 23,402
Other 1,570 786 384 694 817
Fees and other revenue 91,315 116,108 114,369 114,246 120,309
Gains (losses) on securities, net 5,842 1,648 (227) - 21,185
Gains on sales of auto loans 1,133 - - - -
Total non-interest income 98,290 117,756 114,142 114,246 141,494
Non-interest expense:
Compensation and employee benefits 82,595 87,758 89,082 89,357 82,843
Occupancy and equipment 32,366 31,129 30,783 32,159 30,968
FDIC insurance 6,647 7,363 7,542 7,195 7,398
Deposit account premiums 6,482 7,045 6,166 3,198 1,688
Advertising and marketing 2,250 1,145 3,479 3,160 3,154
Other 39,148 34,708 37,067 34,566 37,309
Subtotal 169,488 169,148 174,119 169,635 163,360
Foreclosed real estate and repossessed assets, net 11,323 12,430 12,617 12,868 12,781
Operating lease depreciation 6,811 7,409 7,859 7,928 8,289
Other credit costs, net (89) (139) 496 2,548 1,542
Total non-interest expense 187,533 188,848 195,091 192,979 185,972
Income before income tax expense

24,942

52,657 51,196 50,033 52,162
Income tax expense

7,424

19,159 19,086 18,772 17,391
Income after income tax expense

17,518

33,498 32,110 31,261 34,771
Income attributable to non-controlling interest 1,075 1,243 1,686 989 898
Net income available to common stockholders

$ 16,443

$ 32,255 $ 30,424 $ 30,272 $ 33,873
 
Net income per common share:
Basic

$ .10

$ .20 $ .19 $ .21 $ .24
Diluted

.10

.20 .19 .21 .24
 
Dividends declared per common share $ .05 $ .05 $ .05 $ .05 $ .05
 

Financial Ratios:(1)

 
Return on average assets

.37

% .71 % .68 % .68 % .75 %
Return on average common equity

3.55

7.12 7.00 8.00 9.09
Net interest margin 3.92 3.96 4.02 4.06 4.05
 
(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,
  2011   2011   2011   2011   2010
ASSETS
Cash and due from banks $ 1,175,118 $ 1,078,521 $ 802,812 $ 677,695 $ 506,244
Investments 162,359 162,717 166,039 172,309 176,795
U.S. Government sponsored entities:
Mortgage-backed securities 2,374,026 2,357,865 2,153,016 1,979,648 1,907,958
U.S. Treasury securities - 10,761 135,613 47,269 199,330
Other securities   1,816   2,132   2,360   2,578   2,945
Total securities available for sale 2,375,842 2,370,758 2,290,989 2,029,495 2,110,233
Loans and leases held for sale 4,822 - - - -
Loans and leases:
Consumer real estate:
Fixed-rate 4,528,165 4,592,855 4,655,198 4,734,618 4,874,633
Variable-rate 2,404,886 2,392,966 2,379,250 2,367,341 2,322,623
Consumer - other   19,386   18,183   19,463   21,757   23,283
Total consumer real estate and other 6,952,437 7,004,004 7,053,911 7,123,716 7,220,539
Commercial:
Fixed- and adjustable-rate 2,775,219 2,853,117 2,877,903 2,912,593 2,947,137
Variable-rate   701,441   711,081   719,741   710,870   703,769
Total commercial 3,476,660 3,564,198 3,597,644 3,623,463 3,650,906
Leasing and equipment finance 3,043,329 3,066,208 3,068,550 3,119,669 3,155,472
Inventory finance   766,885   826,198   978,505   872,785   803,157
Total loans and leases   14,239,311   14,460,608   14,698,610   14,739,633   14,830,074
Allowance for loan and lease losses   (251,158)   (253,547)   (255,441)   (263,014)   (251,904)
Net loans and leases 13,988,153 14,207,061 14,443,169 14,476,619 14,578,170
Premises and equipment, net 436,715 439,288 442,529 445,093 446,527
Goodwill 179,070 152,599 152,599 152,599 152,599
Other assets   598,367   582,290   498,194   527,210   638,670
Total assets $ 18,920,446 $ 18,993,234 $ 18,796,331 $ 18,481,020 $ 18,609,238
 
LIABILITIES AND EQUITY
Non-interest-bearing deposits:
Retail $ 1,330,462 $ 1,396,857 $ 1,475,191 $ 1,457,723 $ 1,366,190
Small business 738,867 704,272 683,323 668,316 676,670
Commercial and custodial   303,216   294,253   278,808   291,513   291,295
Total non-interest bearing deposits 2,372,545 2,395,382 2,437,322 2,417,552 2,334,155
Interest-bearing deposits:
Checking 2,096,340 2,103,184 2,152,646 2,104,433 2,044,060
Savings 5,859,147 5,789,188 5,608,824 5,424,327 5,392,650
Money market   662,024   650,598   648,862   673,503   643,801
Subtotal 8,617,511 8,542,970 8,410,332 8,202,263 8,080,511
Certificates of deposit   1,112,735   1,114,934   1,092,368   1,092,537   1,040,348
Total interest-bearing deposits   9,730,246   9,657,904   9,502,700   9,294,800   9,120,859
Total deposits   12,102,791   12,053,286   11,940,022   11,712,352   11,455,014
Borrowings:
Short-term borrowings 37,081 43,073 35,227 83,038 235,219
Long-term borrowings   4,387,036   4,403,724   4,513,301   4,702,729   4,746,823
Total borrowings 4,424,117 4,446,797 4,548,528 4,785,767 4,982,042
Accrued expenses and other liabilities   538,148   672,944   556,641   460,434   674,827
Total liabilities   17,065,056   17,173,027   17,045,191   16,958,553   17,111,883
Equity:
Preferred stock - - - - -
Common stock 1,602 1,598 1,594 1,463 1,428
Additional paid-in capital 711,914 705,366 698,683 503,852 456,760
Retained earnings, subject to certain restrictions 1,121,866 1,105,322 1,081,101 1,058,395 1,034,696
Accumulated other comprehensive income (loss) 48,618 34,073 (8,819) (26,177) 20,168
Treasury stock at cost and other   (33,032)   (33,008)   (33,036)   (22,961)   (23,027)
Total TCF Financial Corp. stockholders equity 1,850,968 1,813,351 1,739,523 1,514,572 1,490,025
Non-controlling interest in subsidiaries   4,422   6,856   11,617   7,895   7,330
Total equity   1,855,390   1,820,207   1,751,140   1,522,467   1,497,355
Total liabilities and equity $ 18,920,446 $ 18,993,234 $ 18,796,331 $ 18,481,020 $ 18,609,238
 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY YIELDS AND RATES (1)
(Unaudited)
                             
 
Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
2011 2011 2011 2011 2010
 
ASSETS
 
Investments and other .84 % .83 % 1.06 % 1.26 % 1.86 %
U.S. Government sponsored entities:
Mortgage-backed securities 3.79 3.86 3.92 3.96 4.16
U.S. Treasury securities - .04 .06 .11 .13
Other securities 3.36 4.68 5.68 5.21 3.69
Total securities available for sale (2) 3.79 3.84 3.69 3.87 3.75
Loans and leases held for sale 10.78 - - - -
Loans and leases:
Consumer real estate:
Fixed-rate 6.04 6.06 6.08 6.15 6.10
Variable-rate 5.09 5.11 5.15 5.19 5.25
Consumer - other 8.49 8.44 9.01 8.87 9.15
Total consumer real estate and other 5.72 5.74 5.78 5.84 5.84
Commercial:
Fixed- and adjustable-rate 5.68 5.72 5.78 5.85 5.90
Variable-rate 4.28 4.33 4.32 4.37 4.16
Total commercial 5.40 5.44 5.49 5.56 5.57
Leasing and equipment finance 5.88 6.01 6.02 6.10 6.24
Inventory finance 7.12 7.28 7.11 7.12 7.19
Total loans and leases 5.75 5.81 5.85 5.90 5.93
 
Total interest-earning assets 5.20 5.28 5.38 5.51 5.59
 
 
LIABILITIES
 
Interest-bearing deposits:
Checking .15 .20 .23 .26 .29
Savings .42 .54 .52 .56 .63
Money market .37 .42 .45 .55 .64
Subtotal .35 .45 .44 .48 .55
Certificates of deposit .75 .79 .81 .83 .86
Total interest-bearing deposits .40 .49 .48 .52 .58
Total deposits .32 .39 .38 .42 .46
Borrowings:
Short-term borrowings .29 .29 .24 .45 .35
Long-term borrowings 4.26 4.28 4.33 4.28 4.42
Total borrowings 4.23 4.24 4.29 4.22 4.23
 
Total interest-bearing liabilities 1.59 1.67 1.72 1.78 1.87
 
 
Net interest margin 3.92 % 3.96 % 4.02 % 4.06 % 4.05 %
 
(1) Annualized.
(2) Average yields of securities available for sale are based upon the historical amortized cost and excludes equity securities.
 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (1)
(Dollars in thousands)
(Unaudited)
             
At Dec. 31, At Dec. 31,
  2011   2010
Computation of total equity to total assets:
Total equity $

1,878,627

$ 1,480,163
Total assets $

18,979,388

$ 18,465,025
Total equity to total assets

9.90

% 8.02 %
 
Computation of tangible realized common equity to tangible assets:
Total equity $

1,878,627

$ 1,480,163
Less: Non-controlling interest in subsidiaries   10,494   8,500
Total TCF Financial Corp. stockholders' equity

1,868,133

1,471,663
Less:
Goodwill 225,640 152,599
Other intangibles 7,134 1,232
Accumulated other comprehensive income 56,826 -
Add:
Accumulated other comprehensive loss   -   15,692
Tangible realized common equity $

1,578,533

$ 1,333,524
 
Total assets $

18,979,388

$ 18,465,025
Less:
Goodwill 225,640 152,599
Other intangibles   7,134   1,232
Tangible assets $

18,746,614

$ 18,311,194
 
Tangible realized common equity to tangible assets

8.42

% 7.28 %
 
 
At Dec. 31, At Dec. 31,
  2011   2010
Computation of tier 1 risk-based capital ratio:
Total tier 1 capital $

1,706,926

$ 1,459,703
Total risk-weighted assets $

13,475,330

$ 13,936,629
Total tier 1 risk-based capital ratio

12.67

% 10.47 %
 
Computation of tier 1 common capital ratio:
Total tier 1 capital $

1,706,926

$ 1,459,703
Less:
Qualifying trust preferred securities 115,000 115,000
Qualifying non-controlling interest in subsidiaries   10,494   8,500
Total tier 1 common capital $

1,581,432

$ 1,336,203
 
Total tier 1 common capital ratio

11.74

% 9.59 %
 
(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.

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