TCF - TCF Reports Quarterly Net Income of $86.2 Million and Diluted Earnings Per Common Share of 51 Cents
Third Quarter Observations
- Revenue of $365.6 million, up 6.5% from the third quarter of 2017
- Provision for credit losses of $2.3 million, which was impacted by a $6.6 million recovery on previous charge-offs related to the sale of consumer real estate non-accrual loans
- Net interest margin of 4.66%, down 1 basis point from the second quarter of 2018, up 5 basis points from the third quarter of 2017
- Efficiency ratio of 67.41%, down 105 basis points from the third quarter of 2017
- Average interest-earning asset growth of 4.6% from the third quarter of 2017
- Period-end loans and leases of $18.4 billion, down 3.0% from September 30, 2017; period-end loans and leases, excluding auto finance, up 2.5%(1) from September 30, 2017
- Auto finance portfolio run-off of $328.1 million in the third quarter of 2018 and $924.5 million year-to-date
- Return on average common equity ("ROACE") of 14.44%
- Return on average tangible common equity ("ROATCE") of 15.76%(2)
- Repurchased 0.9 million shares of common stock at a cost of $24.0 million
TCF Financial Corporation (NYSE: TCF):
| Summary of Financial Results |
| At or For the Quarter Ended |
| Change From |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, |
| Sep. 30, |
| (Dollars in thousands, except per share data) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| 2018 |
| 2017 |
| Net income attributable to TCF |
| $ |
| 86,196 |
| $ |
| 58,749 |
| $ |
| 73,761 |
| $ |
| 101,399 |
| $ |
| 60,528 |
| 46.7 |
| % |
| 42.4 |
| % |
| Net interest income |
| 249,121 |
| 250,799 |
| 243,199 |
| 241,860 |
| 234,103 |
| (0.7 |
| ) |
| 6.4 |
| Basic earnings per common share |
| 0.51 |
| 0.34 |
| 0.39 |
| 0.58 |
| 0.29 |
| 50.0 |
| 75.9 |
| Diluted earnings per common share |
| 0.51 |
| 0.34 |
| 0.39 |
| 0.57 |
| 0.29 |
| 50.0 |
| 75.9 |
| Adjusted diluted earnings per common share(2) |
| 0.51 |
| 0.49 |
| 0.39 |
| 0.57 |
| 0.29 |
| 4.1 |
| 75.9 |
| Financial Ratios |
| Return on average assets(3) |
| 1.55 |
| % |
| 1.08 |
| % |
| 1.33 |
| % |
| 1.82 |
| % |
| 1.15 |
| % |
| 47 |
| bps |
| 40 |
| bps |
| ROACE(3) |
| 14.44 |
| 9.72 |
| 11.23 |
| 16.95 |
| 8.44 |
| 472 |
| 600 |
| Adjusted ROACE(2)(3) |
| 14.44 |
| 14.11 |
| 11.23 |
| 16.95 |
| 8.44 |
| 33 |
| 600 |
| ROATCE(2)(3) |
| 15.76 |
| 10.65 |
| 12.26 |
| 32.87 |
| 9.57 |
| 511 |
| 619 |
| Adjusted ROATCE(2)(3) |
| 15.76 |
| 15.39 |
| 12.26 |
| 32.87 |
| 9.57 |
| 37 |
| 619 |
| Net interest margin(3) |
| 4.66 |
| 4.67 |
| 4.59 |
| 4.57 |
| 4.61 |
| (1 |
| ) |
| 5 |
| Net charge-offs as a percentage of average loans and leases(3) |
| 0.15 |
| 0.27 |
| 0.29 |
| 0.38 |
| 0.18 |
| (12 |
| ) |
| (3 |
| ) |
| Non-performing assets as a percentage of total loans and leases and other real estate owned |
| 0.59 |
| 0.54 |
| 0.74 |
| 0.72 |
| 0.77 |
| 5 |
| (18 |
| ) |
| Efficiency ratio |
| 67.41 |
| 74.55 |
| 69.21 |
| 95.88 |
| 68.46 |
| (714 |
| ) |
| (105 |
| ) |
| Adjusted efficiency ratio(2) |
| 67.41 |
| 65.78 |
| 69.21 |
| 95.88 |
| 68.46 |
| 163 |
| (105 |
| ) |
| (1) |
| Calculated by subtracting auto finance loans of $2.3 billion and $3.2 billion at September 30, 2018 and 2017, respectively, from total loans and leases of $18.4 billion and $19.0 billion at September 30, 2018 and 2017, respectively. |
| (2) |
| See "Reconciliation of GAAP to Non-GAAP Financial Measures" tables. |
| (3) |
| Annualized |
TCF Financial Corporation ("TCF" or the "Company") (NYSE: TCF) today reported net income of $86.2 million for the third quarter of 2018, compared with $60.5 million for the third quarter of 2017 and $58.7 million for the second quarter of 2018. Diluted earnings per common share was 51 cents for the third quarter of 2018, compared with 29 cents for the third quarter of 2017 and 34 cents for the second quarter of 2018.
"Our strong third quarter financial results were highlighted by positive year-over-year operating leverage and improving returns on capital," said Craig R. Dahl, chairman and chief executive officer. "We produced strong revenue growth with disciplined expense management while continuing to lower the risk profile of the Company. Credit trends remained stable, the auto finance portfolio run-off performed as expected and our mix of interest-earning assets improved as we continued to shift toward increasingly more capital efficient assets. Our commitment to increasing return on capital has shown through in our results and we remain focused on delivering value for shareholders."
Net Interest Income and Net Interest Margin
Net interest income was $249.1 million for the third quarter of 2018, an increase of $15.0 million, or 6.4%, from the third quarter of 2017 and a decrease of $1.7 million, or 0.7%, from the second quarter of 2018. Net interest margin was 4.66% for the third quarter of 2018, up 5 basis points from the third quarter of 2017 and down 1 basis point from the second quarter of 2018. The increases in net interest income and net interest margin from the third quarter of 2017 were primarily due to increased average yields and higher average loan balances in the variable- and adjustable-rate loan portfolios, partially offset by increased cost of funds.
Non-interest Income
Non-interest income was $116.4 million for the third quarter of 2018, an increase of $7.2 million, or 6.6%, from the third quarter of 2017 and an increase of $2.3 million, or 2.1%, from the second quarter of 2018. The increases from both periods were primarily due to increased leasing and equipment finance non-interest income, partially offset by decreased servicing fee income due to the continued run-off in the auto finance serviced for others portfolio.
Non-interest Expense
Non-interest expense was $246.4 million for the third quarter of 2018, an increase of $11.4 million, or 4.8%, from the third quarter of 2017 and a decrease of $25.6 million, or 9.4%, from the second quarter of 2018. The increase from the third quarter of 2017 was primarily due to an increase in compensation and employee benefits expense. The second quarter of 2018 included $32.0 million of expenses related to the settlement with the Bureau of Consumer Financial Protection and the Office of the Comptroller of the Currency.
Income Tax Expense
The Company's effective income tax rate was 24.0% for the third quarter of 2018, compared with 32.7% for the third quarter of 2017 and 20.9% for the second quarter of 2018. The effective income tax rate was primarily impacted by the change in the corporate statutory tax rate as a result of the Tax Cuts and Jobs Act.
Credit Quality
Provision for credit losses The provision for credit losses was $2.3 million for the third quarter of 2018, a decrease of $12.3 million, or 84.4%, from the third quarter of 2017 and a decrease of $12.0 million, or 84.1%, from the second quarter of 2018. The decreases from both periods were primarily due to run-off in and maturation of the auto finance portfolio, as well as the recovery of $6.6 million on previous charge-offs related to the sale of consumer real estate non-accrual loans.
Net charge-off rate The annualized net charge-off rate was 0.15% for the third quarter of 2018, down 3 basis points from the third quarter of 2017 and down 12 basis points from the second quarter of 2018. The decreases from both periods were primarily due to the recovery of $6.6 million on previous charge-offs related to the sale of consumer real estate non-accrual loans, partially offset by the increased auto finance net charge-off rate resulting from a lower average loan balance due to the continued run-off of the portfolio. The annualized net charge-off rate excluding auto finance net charge-offs of $9.5 million and the recovery of $6.6 million on previous charge-offs related to the sale of consumer real estate non-accrual loans was 0.10%.
Over 60-day delinquency rate The over 60-day delinquency rate, excluding non-accrual loans and leases, was 0.12% at September 30, 2018, down 1 basis point from the September 30, 2017 rate and up 1 basis point from the June 30, 2018 rate.
Non-performing assets Non-performing assets, consisting of non-accrual loans and leases and other real estate owned, were $109.4 million at September 30, 2018, a decrease of $36.6 million, or 25.1%, from September 30, 2017 and an increase of $8.3 million, or 8.2%, from June 30, 2018. The decrease from September 30, 2017 was primarily due to the $34.7 million sale of consumer real estate non-accrual loans in the third quarter of 2018.
Balance Sheet
Average debt securities held to maturity and debt securities available for sale The total average debt securities portfolio was $2.5 billion for the third quarter of 2018, an increase of $773.2 million, or 44.7%, from the third quarter of 2017 and an increase of $256.6 million, or 11.4%, from the second quarter of 2018.
Average loans and leases Average loans and leases were $18.4 billion for the third quarter of 2018, an increase of $17.0 million, or 0.1%, from the third quarter of 2017 and a decrease of $678.1 million, or 3.6%, from the second quarter of 2018. The decrease from the second quarter of 2018 was primarily due to the seasonal decrease in the inventory finance portfolio and the continued run-off of the auto finance portfolio. Average loans and leases, excluding auto finance were $16.0 billion, an increase of $861.7 million, or 5.7%, from the third quarter of 2017 and a decrease of $418.0 million, or 2.5%, from the second quarter of 2018.
Average deposits Average deposits were $18.3 billion for the third quarter of 2018, an increase of $637.2 million, or 3.6%, from the third quarter of 2017 and a decrease of $77.9 million, or 0.4%, from the second quarter of 2018.
Capital TCF continues to maintain strong capital ratios, with a common equity Tier 1 capital ratio of 11.04%. TCF repurchased $24.0 million of common stock during the quarter and had the authority to repurchase an additional $141.0 million in aggregate value of shares as of September 30, 2018 pursuant to its share repurchase program.
Webcast Information
A live webcast of TCF's conference call to discuss the third quarter earnings will be hosted at TCF's website, http://ir.tcfbank.com, on October 22, 2018 at 9:00 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 on 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.
|
TCF is a Wayzata, Minnesota-based national bank holding company. As of September 30, 2018, TCF had $22.9 billion in total assets and 315 bank branches in Illinois, Minnesota, Michigan, Colorado, Wisconsin, Arizona and South Dakota providing retail and commercial banking services. TCF, through its subsidiaries, also conducts commercial leasing and equipment finance business in all 50 states and commercial inventory finance business in all 50 states and Canada. For more information about TCF, please visit http://ir.tcfbank.com. |
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, targets, 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, 2017 under the heading "Risk Factors" 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.
Use of Non-GAAP Financial Measures
Management uses the adjusted diluted earnings per common share, adjusted ROACE, ROATCE, adjusted ROATCE, adjusted efficiency ratio, tangible common equity ratio and tangible book value per common share internally to measure performance and believes that these financial measures not recognized under generally accepted accounting principles in the United States ("GAAP") (i.e. non-GAAP) provide meaningful information to investors that will permit them to assess the Company's capital and ability to withstand unexpected market or economic conditions and to assess the performance of the Company in relation to other banking institutions on the same basis as that applied by management, analysts and banking regulators.
These non-GAAP financial measures are not defined by GAAP and other entities may calculate them differently than TCF does. Non-GAAP financial measures have inherent limitations and are not required to be uniformly applied. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of results as reported under GAAP. In particular, a measure of earnings that excludes selected items does not represent the amount that effectively accrues directly to stockholders.
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Statements of Financial Condition (Unaudited) |
| Change From |
| (Dollars in thousands) |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, 2018 |
| Sep. 30, 2017 |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| $ |
| % |
| $ |
| % |
| ASSETS: |
| Cash and due from banks |
| $ |
| 569,968 |
| $ |
| 581,876 |
| $ |
| 588,893 |
| $ |
| 621,782 |
| $ |
| 711,734 |
| $ |
| (11,908 |
| ) |
| (2.0 |
| )% |
| $ |
| (141,766 |
| ) |
| (19.9 |
| )% |
| Investments |
| 80,672 |
| 95,661 |
| 91,661 |
| 82,644 |
| 87,690 |
| (14,989 |
| ) |
| (15.7 |
| ) |
| (7,018 |
| ) |
| (8.0 |
| ) |
| Debt securities held to maturity |
| 152,881 |
| 155,962 |
| 158,099 |
| 161,576 |
| 165,315 |
| (3,081 |
| ) |
| (2.0 |
| ) |
| (12,434 |
| ) |
| (7.5 |
| ) |
| Debt securities available for sale |
| 2,379,546 |
| 2,249,784 |
| 1,954,246 |
| 1,709,018 |
| 1,598,163 |
| 129,762 |
| 5.8 |
| 781,383 |
| 48.9 |
| Loans and leases held for sale |
| 114,198 |
| 291,871 |
| 50,706 |
| 134,862 |
| 254,903 |
| (177,673 |
| ) |
| (60.9 |
| ) |
| (140,705 |
| ) |
| (55.2 |
| ) |
| Loans and leases: |
| Consumer real estate: |
| First mortgage lien |
| 1,960,756 |
| 1,800,885 |
| 1,878,441 |
| 1,959,387 |
| 1,953,199 |
| 159,871 |
| 8.9 |
| 7,557 |
| 0.4 |
| Junior lien |
| 2,940,701 |
| 2,830,029 |
| 2,843,221 |
| 2,860,309 |
| 2,977,613 |
| 110,672 |
| 3.9 |
| (36,912 |
| ) |
| (1.2 |
| ) |
| Total consumer real estate |
| 4,901,457 |
| 4,630,914 |
| 4,721,662 |
| 4,819,696 |
| 4,930,812 |
| 270,543 |
| 5.8 |
| (29,355 |
| ) |
| (0.6 |
| ) |
| Commercial |
| 3,741,164 |
| 3,706,401 |
| 3,678,181 |
| 3,561,193 |
| 3,489,680 |
| 34,763 |
| 0.9 |
| 251,484 |
| 7.2 |
| Leasing and equipment finance |
| 4,601,887 |
| 4,648,049 |
| 4,666,239 |
| 4,761,661 |
| 4,730,931 |
| (46,162 |
| ) |
| (1.0 |
| ) |
| (129,044 |
| ) |
| (2.7 |
| ) |
| Inventory finance |
| 2,880,404 |
| 3,005,165 |
| 3,457,855 |
| 2,739,754 |
| 2,576,077 |
| (124,761 |
| ) |
| (4.2 |
| ) |
| 304,327 |
| 11.8 |
| Auto finance |
| 2,275,134 |
| 2,603,260 |
| 2,839,363 |
| 3,199,639 |
| 3,240,413 |
| (328,126 |
| ) |
| (12.6 |
| ) |
| (965,279 |
| ) |
| (29.8 |
| ) |
| Other |
| 21,107 |
| 20,957 |
| 19,854 |
| 22,517 |
| 20,439 |
| 150 |
| 0.7 |
| 668 |
| 3.3 |
| Total loans and leases |
| 18,421,153 |
| 18,614,746 |
| 19,383,154 |
| 19,104,460 |
| 18,988,352 |
| (193,593 |
| ) |
| (1.0 |
| ) |
| (567,199 |
| ) |
| (3.0 |
| ) |
| Allowance for loan and lease losses |
| (160,621 |
| ) |
| (165,619 |
| ) |
| (167,703 |
| ) |
| (171,041 |
| ) |
| (168,244 |
| ) |
| 4,998 |
| 3.0 |
| 7,623 |
| 4.5 |
| Net loans and leases |
| 18,260,532 |
| 18,449,127 |
| 19,215,451 |
| 18,933,419 |
| 18,820,108 |
| (188,595 |
| ) |
| (1.0 |
| ) |
| (559,576 |
| ) |
| (3.0 |
| ) |
| Premises and equipment, net |
| 429,648 |
| 430,956 |
| 427,497 |
| 421,549 |
| 425,112 |
| (1,308 |
| ) |
| (0.3 |
| ) |
| 4,536 |
| 1.1 |
| Goodwill, net |
| 154,757 |
| 154,757 |
| 154,757 |
| 154,757 |
| 227,798 |
| – |
| – |
| (73,041 |
| ) |
| (32.1 |
| ) |
| Other assets |
| 762,583 |
| 774,468 |
| 743,742 |
| 782,552 |
| 714,215 |
| (11,885 |
| ) |
| (1.5 |
| ) |
| 48,368 |
| 6.8 |
| Total assets |
| $ |
| 22,904,785 |
| $ |
| 23,184,462 |
| $ |
| 23,385,052 |
| $ |
| 23,002,159 |
| $ |
| 23,005,038 |
| $ |
| (279,677 |
| ) |
| (1.2 |
| ) |
| $ |
| (100,253 |
| ) |
| (0.4 |
| ) |
| LIABILITIES AND EQUITY: |
| Deposits: |
| Checking |
| $ |
| 6,382,667 |
| $ |
| 6,408,174 |
| $ |
| 6,541,409 |
| $ |
| 6,300,127 |
| $ |
| 6,197,608 |
| $ |
| (25,507 |
| ) |
| (0.4 |
| )% |
| $ |
| 185,059 |
| 3.0 |
| % |
| Savings |
| 5,737,144 |
| 5,570,979 |
| 5,551,155 |
| 5,287,606 |
| 4,972,529 |
| 166,165 |
| 3.0 |
| 764,615 |
| 15.4 |
| Money market |
| 1,504,952 |
| 1,562,008 |
| 1,609,472 |
| 1,764,998 |
| 1,965,291 |
| (57,056 |
| ) |
| (3.7 |
| ) |
| (460,339 |
| ) |
| (23.4 |
| ) |
| Certificates of deposit |
| 4,871,748 |
| 4,822,112 |
| 4,995,636 |
| 4,982,271 |
| 4,972,058 |
| 49,636 |
| 1.0 |
| (100,310 |
| ) |
| (2.0 |
| ) |
| Total deposits |
| 18,496,511 |
| 18,363,273 |
| 18,697,672 |
| 18,335,002 |
| 18,107,486 |
| 133,238 |
| 0.7 |
| 389,025 |
| 2.1 |
| Short-term borrowings |
| 2,324 |
| 761 |
| 775 |
| – |
| – |
| 1,563 |
| N.M. |
| 2,324 |
| N.M. |
| Long-term borrowings |
| 1,168,400 |
| 1,554,569 |
| 1,457,976 |
| 1,249,449 |
| 1,382,588 |
| (386,169 |
| ) |
| (24.8 |
| ) |
| (214,188 |
| ) |
| (15.5 |
| ) |
| Total borrowings |
| 1,170,724 |
| 1,555,330 |
| 1,458,751 |
| 1,249,449 |
| 1,382,588 |
| (384,606 |
| ) |
| (24.7 |
| ) |
| (211,864 |
| ) |
| (15.3 |
| ) |
| Accrued expenses and other liabilities |
| 709,538 |
| 761,281 |
| 677,679 |
| 737,124 |
| 918,450 |
| (51,743 |
| ) |
| (6.8 |
| ) |
| (208,912 |
| ) |
| (22.7 |
| ) |
| Total liabilities |
| 20,376,773 |
| 20,679,884 |
| 20,834,102 |
| 20,321,575 |
| 20,408,524 |
| (303,111 |
| ) |
| (1.5 |
| ) |
| (31,751 |
| ) |
| (0.2 |
| ) |
| Equity: |
| Preferred stock |
| 169,302 |
| 169,302 |
| 169,302 |
| 265,821 |
| 265,967 |
| – |
| – |
| (96,665 |
| ) |
| (36.3 |
| ) |
| Common stock |
| 1,736 |
| 1,735 |
| 1,725 |
| 1,722 |
| 1,719 |
| 1 |
| 0.1 |
| 17 |
| 1.0 |
| Additional paid-in capital |
| 882,321 |
| 877,364 |
| 878,096 |
| 877,217 |
| 864,632 |
| 4,957 |
| 0.6 |
| 17,689 |
| 2.0 |
| Retained earnings, subject to certain restrictions |
| 1,708,410 |
| 1,649,449 |
| 1,618,041 |
| 1,577,311 |
| 1,488,966 |
| 58,961 |
| 3.6 |
| 219,444 |
| 14.7 |
| Accumulated other comprehensive income (loss) |
| (65,259 |
| ) |
| (52,811 |
| ) |
| (46,851 |
| ) |
| (18,517 |
| ) |
| (13,809 |
| ) |
| (12,448 |
| ) |
| (23.6 |
| ) |
| (51,450 |
| ) |
| N.M. |
| Treasury stock at cost and other |
| (189,652 |
| ) |
| (164,107 |
| ) |
| (97,800 |
| ) |
| (40,797 |
| ) |
| (30,867 |
| ) |
| (25,545 |
| ) |
| (15.6 |
| ) |
| (158,785 |
| ) |
| N.M. |
| Total TCF Financial Corporation stockholders' equity |
| 2,506,858 |
| 2,480,932 |
| 2,522,513 |
| 2,662,757 |
| 2,576,608 |
| 25,926 |
| 1.0 |
| (69,750 |
| ) |
| (2.7 |
| ) |
| Non-controlling interest in subsidiaries |
| 21,154 |
| 23,646 |
| 28,437 |
| 17,827 |
| 19,906 |
| (2,492 |
| ) |
| (10.5 |
| ) |
| 1,248 |
| 6.3 |
| Total equity |
| 2,528,012 |
| 2,504,578 |
| 2,550,950 |
| 2,680,584 |
| 2,596,514 |
| 23,434 |
| 0.9 |
| (68,502 |
| ) |
| (2.6 |
| ) |
| Total liabilities and equity |
| $ |
| 22,904,785 |
| $ |
| 23,184,462 |
| $ |
| 23,385,052 |
| $ |
| 23,002,159 |
| $ |
| 23,005,038 |
| $ |
| (279,677 |
| ) |
| (1.2 |
| ) |
| $ |
| (100,253 |
| ) |
| (0.4 |
| ) |
|
N.M. Not Meaningful |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Statements of Income (Unaudited) |
| Quarter Ended |
| Change From |
| (Dollars in thousands) |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, 2018 |
| Sep. 30, 2017 |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| $ |
| % |
| $ |
| % |
| Interest income: |
| Loans and leases |
| $ |
| 264,678 |
| $ |
| 269,280 |
| $ |
| 260,375 |
| $ |
| 256,633 |
| $ |
| 243,973 |
| $ |
| (4,602 |
| ) |
| (1.7 |
| )% |
| $ |
| 20,705 |
| 8.5 |
| % |
| Debt securities available for sale |
| 14,838 |
| 12,516 |
| 10,123 |
| 8,760 |
| 8,486 |
| 2,322 |
| 18.6 |
| 6,352 |
| 74.9 |
| Debt securities held to maturity |
| 988 |
| 998 |
| 1,019 |
| 1,048 |
| 1,073 |
| (10 |
| ) |
| (1.0 |
| ) |
| (85 |
| ) |
| (7.9 |
| ) |
| Loans held for sale and other |
| 6,678 |
| 3,529 |
| 3,745 |
| 4,187 |
| 4,073 |
| 3,149 |
| 89.2 |
| 2,605 |
| 64.0 |
| Total interest income |
| 287,182 |
| 286,323 |
| 275,262 |
| 270,628 |
| 257,605 |
| 859 |
| 0.3 |
| 29,577 |
| 11.5 |
| Interest expense: |
| Deposits |
| 27,335 |
| 23,953 |
| 22,510 |
| 20,846 |
| 17,015 |
| 3,382 |
| 14.1 |
| 10,320 |
| 60.7 |
| Borrowings |
| 10,726 |
| 11,571 |
| 9,553 |
| 7,922 |
| 6,487 |
| (845 |
| ) |
| (7.3 |
| ) |
| 4,239 |
| 65.3 |
| Total interest expense |
| 38,061 |
| 35,524 |
| 32,063 |
| 28,768 |
| 23,502 |
| 2,537 |
| 7.1 |
| 14,559 |
| 61.9 |
| Net interest income |
| 249,121 |
| 250,799 |
| 243,199 |
| 241,860 |
| 234,103 |
| (1,678 |
| ) |
| (0.7 |
| ) |
| 15,018 |
| 6.4 |
| Provision for credit losses |
| 2,270 |
| 14,236 |
| 11,368 |
| 22,259 |
| 14,545 |
| (11,966 |
| ) |
| (84.1 |
| ) |
| (12,275 |
| ) |
| (84.4 |
| ) |
| Net interest income after provision for credit losses |
| 246,851 |
| 236,563 |
| 231,831 |
| 219,601 |
| 219,558 |
| 10,288 |
| 4.3 |
| 27,293 |
| 12.4 |
| Non-interest income: |
| Fees and service charges |
| 32,574 |
| 32,670 |
| 30,751 |
| 33,267 |
| 34,605 |
| (96 |
| ) |
| (0.3 |
| ) |
| (2,031 |
| ) |
| (5.9 |
| ) |
| Card revenue |
| 15,065 |
| 14,962 |
| 13,759 |
| 14,251 |
| 14,177 |
| 103 |
| 0.7 |
| 888 |
| 6.3 |
| ATM revenue |
| 5,053 |
| 4,933 |
| 4,650 |
| 4,654 |
| 5,234 |
| 120 |
| 2.4 |
| (181 |
| ) |
| (3.5 |
| ) |
| Subtotal |
| 52,692 |
| 52,565 |
| 49,160 |
| 52,172 |
| 54,016 |
| 127 |
| 0.2 |
| (1,324 |
| ) |
| (2.5 |
| ) |
| Gains on sales of auto loans, net |
| – |
| – |
| – |
| 2,216 |
| – |
| – |
| – |
| – |
| – |
| Gains on sales of consumer real estate loans, net |
| 8,764 |
| 7,192 |
| 9,123 |
| 11,407 |
| 8,049 |
| 1,572 |
| 21.9 |
| 715 |
| 8.9 |
| Servicing fee income |
| 6,032 |
| 7,484 |
| 8,295 |
| 9,000 |
| 9,966 |
| (1,452 |
| ) |
| (19.4 |
| ) |
| (3,934 |
| ) |
| (39.5 |
| ) |
| Subtotal |
| 14,796 |
| 14,676 |
| 17,418 |
| 22,623 |
| 18,015 |
| 120 |
| 0.8 |
| (3,219 |
| ) |
| (17.9 |
| ) |
| Leasing and equipment finance |
| 45,045 |
| 42,904 |
| 41,847 |
| 42,831 |
| 34,080 |
| 2,141 |
| 5.0 |
| 10,965 |
| 32.2 |
| Other |
| 3,818 |
| 3,934 |
| 3,716 |
| 3,218 |
| 2,930 |
| (116 |
| ) |
| (2.9 |
| ) |
| 888 |
| 30.3 |
| Fees and other revenue |
| 116,351 |
| 114,079 |
| 112,141 |
| 120,844 |
| 109,041 |
| 2,272 |
| 2.0 |
| 7,310 |
| 6.7 |
| Gains (losses) on debt securities, net |
| 94 |
| 24 |
| 63 |
| 48 |
| 189 |
| 70 |
| N.M. |
| (95 |
| ) |
| (50.3 |
| ) |
| Total non-interest income |
| 116,445 |
| 114,103 |
| 112,204 |
| 120,892 |
| 109,230 |
| 2,342 |
| 2.1 |
| 7,215 |
| 6.6 |
| Non-interest expense: |
| Compensation and employee benefits |
| 123,127 |
| 120,575 |
| 123,840 |
| 127,630 |
| 114,954 |
| 2,552 |
| 2.1 |
| 8,173 |
| 7.1 |
| Occupancy and equipment |
| 42,337 |
| 40,711 |
| 40,514 |
| 39,578 |
| 38,766 |
| 1,626 |
| 4.0 |
| 3,571 |
| 9.2 |
| Other |
| 57,989 |
| 89,084 |
| 58,819 |
| 159,019 |
| 61,581 |
| (31,095 |
| ) |
| (34.9 |
| ) |
| (3,592 |
| ) |
| (5.8 |
| ) |
| Subtotal |
| 223,453 |
| 250,370 |
| 223,173 |
| 326,227 |
| 215,301 |
| (26,917 |
| ) |
| (10.8 |
| ) |
| 8,152 |
| 3.8 |
| Operating lease depreciation |
| 19,525 |
| 17,945 |
| 17,274 |
| 16,497 |
| 15,696 |
| 1,580 |
| 8.8 |
| 3,829 |
| 24.4 |
| Foreclosed real estate and repossessed assets, net |
| 3,881 |
| 3,857 |
| 4,916 |
| 4,739 |
| 3,829 |
| 24 |
| 0.6 |
| 52 |
| 1.4 |
| Other credit costs, net |
| (436 |
| ) |
| (133 |
| ) |
| 617 |
| 343 |
| 209 |
| (303 |
| ) |
| N.M. |
| (645 |
| ) |
| N.M. |
| Total non-interest expense |
| 246,423 |
| 272,039 |
| 245,980 |
| 347,806 |
| 235,035 |
| (25,616 |
| ) |
| (9.4 |
| ) |
| 11,388 |
| 4.8 |
| Income (loss) before income tax expense (benefit) |
| 116,873 |
| 78,627 |
| 98,055 |
| (7,313 |
| ) |
| 93,753 |
| 38,246 |
| 48.6 |
| 23,120 |
| 24.7 |
| Income tax expense (benefit) |
| 28,034 |
| 16,418 |
| 21,631 |
| (110,965 |
| ) |
| 30,704 |
| 11,616 |
| 70.8 |
| (2,670 |
| ) |
| (8.7 |
| ) |
| Income after income tax expense (benefit) |
| 88,839 |
| 62,209 |
| 76,424 |
| 103,652 |
| 63,049 |
| 26,630 |
| 42.8 |
| 25,790 |
| 40.9 |
| Income attributable to non-controlling interest |
| 2,643 |
| 3,460 |
| 2,663 |
| 2,253 |
| 2,521 |
| (817 |
| ) |
| (23.6 |
| ) |
| 122 |
| 4.8 |
| Net income attributable to TCF Financial Corporation |
| 86,196 |
| 58,749 |
| 73,761 |
| 101,399 |
| 60,528 |
| 27,447 |
| 46.7 |
| 25,668 |
| 42.4 |
| Preferred stock dividends |
| 2,494 |
| 2,494 |
| 4,106 |
| 3,746 |
| 6,464 |
| – |
| – |
| (3,970 |
| ) |
| (61.4 |
| ) |
| Impact of preferred stock redemption or notice to redeem preferred stock |
| – |
| – |
| 3,481 |
| – |
| 5,779 |
| – |
| – |
| (5,779 |
| ) |
| (100.0 |
| ) |
| Net income available to common stockholders |
| $ |
| 83,702 |
| $ |
| 56,255 |
| $ |
| 66,174 |
| $ |
| 97,653 |
| $ |
| 48,285 |
| $ |
| 27,447 |
| 48.8 |
| $ |
| 35,417 |
| 73.3 |
|
N.M. Not Meaningful |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Statements of Income (Unaudited) |
| Nine Months Ended |
| September 30, |
| Change |
| (Dollars in thousands, except per share data) |
| 2018 |
| 2017 |
| $ |
| % |
| Interest income: |
| Loans and leases |
| $ |
| 794,333 |
| $ |
| 697,613 |
| $ |
| 96,720 |
| 13.9 |
| % |
| Debt securities available for sale |
| 37,477 |
| 24,518 |
| 12,959 |
| 52.9 |
| Debt securities held to maturity |
| 3,005 |
| 3,388 |
| (383 |
| ) |
| (11.3 |
| ) |
| Loans held for sale and other |
| 13,952 |
| 22,910 |
| (8,958 |
| ) |
| (39.1 |
| ) |
| Total interest income |
| 848,767 |
| 748,429 |
| 100,338 |
| 13.4 |
| Interest expense: |
| Deposits |
| 73,798 |
| 45,166 |
| 28,632 |
| 63.4 |
| Borrowings |
| 31,850 |
| 19,885 |
| 11,965 |
| 60.2 |
| Total interest expense |
| 105,648 |
| 65,051 |
| 40,597 |
| 62.4 |
| Net interest income |
| 743,119 |
| 683,378 |
| 59,741 |
| 8.7 |
| Provision for credit losses |
| 27,874 |
| 46,184 |
| (18,310 |
| ) |
| (39.6 |
| ) |
| Net interest income after provision for credit losses |
| 715,245 |
| 637,194 |
| 78,051 |
| 12.2 |
| Non-interest income: |
| Fees and service charges |
| 95,995 |
| 98,620 |
| (2,625 |
| ) |
| (2.7 |
| ) |
| Card revenue |
| 43,786 |
| 41,481 |
| 2,305 |
| 5.6 |
| ATM revenue |
| 14,636 |
| 14,970 |
| (334 |
| ) |
| (2.2 |
| ) |
| Subtotal |
| 154,417 |
| 155,071 |
| (654 |
| ) |
| (0.4 |
| ) |
| Gains on sales of auto loans, net |
| – |
| 3,244 |
| (3,244 |
| ) |
| (100.0 |
| ) |
| Gains on sales of consumer real estate loans, net |
| 25,079 |
| 25,920 |
| (841 |
| ) |
| (3.2 |
| ) |
| Servicing fee income |
| 21,811 |
| 32,347 |
| (10,536 |
| ) |
| (32.6 |
| ) |
| Subtotal |
| 46,890 |
| 61,511 |
| (14,621 |
| ) |
| (23.8 |
| ) |
| Leasing and equipment finance |
| 129,796 |
| 102,208 |
| 27,588 |
| 27.0 |
| Other |
| 11,468 |
| 8,428 |
| 3,040 |
| 36.1 |
| Fees and other revenue |
| 342,571 |
| 327,218 |
| 15,353 |
| 4.7 |
| Gains (losses) on debt securities, net |
| 181 |
| 189 |
| (8 |
| ) |
| (4.2 |
| ) |
| Total non-interest income |
| 342,752 |
| 327,407 |
| 15,345 |
| 4.7 |
| Non-interest expense: |
| Compensation and employee benefits |
| 367,542 |
| 354,882 |
| 12,660 |
| 3.6 |
| Occupancy and equipment |
| 123,562 |
| 117,331 |
| 6,231 |
| 5.3 |
| Other |
| 205,892 |
| 187,160 |
| 18,732 |
| 10.0 |
| Subtotal |
| 696,996 |
| 659,373 |
| 37,623 |
| 5.7 |
| Operating lease depreciation |
| 54,744 |
| 39,404 |
| 15,340 |
| 38.9 |
| Foreclosed real estate and repossessed assets, net |
| 12,654 |
| 13,017 |
| (363 |
| ) |
| (2.8 |
| ) |
| Other credit costs, net |
| 48 |
| 334 |
| (286 |
| ) |
| (85.6 |
| ) |
| Total non-interest expense |
| 764,442 |
| 712,128 |
| 52,314 |
| 7.3 |
| Income before income tax expense |
| 293,555 |
| 252,473 |
| 41,082 |
| 16.3 |
| Income tax expense |
| 66,083 |
| 77,341 |
| (11,258 |
| ) |
| (14.6 |
| ) |
| Income after income tax expense |
| 227,472 |
| 175,132 |
| 52,340 |
| 29.9 |
| Income attributable to non-controlling interest |
| 8,766 |
| 7,894 |
| 872 |
| 11.0 |
| Net income attributable to TCF Financial Corporation |
| 218,706 |
| 167,238 |
| 51,468 |
| 30.8 |
| Preferred stock dividends |
| 9,094 |
| 16,158 |
| (7,064 |
| ) |
| (43.7 |
| ) |
| Impact of preferred stock redemption or notice to redeem preferred stock |
| 3,481 |
| 5,779 |
| (2,298 |
| ) |
| (39.8 |
| ) |
| Net income available to common stockholders |
| $ |
| 206,131 |
| $ |
| 145,301 |
| $ |
| 60,830 |
| 41.9 |
| Earnings per common share: |
| Basic |
| $ |
| 1.24 |
| $ |
| 0.86 |
| $ |
| 0.38 |
| 44.2 |
| % |
| Diluted |
| 1.23 |
| 0.86 |
| 0.37 |
| 43.0 |
| Dividends declared per common share |
| $ |
| 0.45 |
| $ |
| 0.225 |
| $ |
| 0.225 |
| 100.0 |
| % |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Average Balance Sheets, Yields and Rates (Unaudited) |
| Quarter Ended September 30, |
| 2018 |
| 2017 |
| Average |
| Yields and |
| Average |
| Yields and |
| (Dollars in thousands) |
| Balance |
| Interest(1) |
| Rates(1)(2) |
| Balance |
| Interest(1) |
| Rates(1)(2) |
| ASSETS: |
| Investments and other |
| $ |
| 306,257 |
| $ |
| 3,089 |
| 4.01 |
| % |
| $ |
| 279,839 |
| $ |
| 2,679 |
| 3.80 |
| % |
| Debt securities held to maturity |
| 153,652 |
| 988 |
| 2.57 |
| 166,883 |
| 1,073 |
| 2.57 |
| Debt securities available for sale: |
| Taxable |
| 1,525,665 |
| 10,511 |
| 2.76 |
| 825,192 |
| 4,619 |
| 2.24 |
| Tax-exempt(3) |
| 823,854 |
| 5,478 |
| 2.66 |
| 737,859 |
| 5,949 |
| 3.22 |
| Loans and leases held for sale |
| 216,669 |
| 3,589 |
| 6.57 |
| 96,143 |
| 1,394 |
| 5.75 |
| Loans and leases:(4) |
| Consumer real estate: |
| Fixed-rate |
| 1,694,661 |
| 23,316 |
| 5.46 |
| 1,872,607 |
| 26,490 |
| 5.61 |
| Variable- and adjustable-rate |
| 3,002,225 |
| 49,719 |
| 6.57 |
| 2,964,493 |
| 44,160 |
| 5.91 |
|
Total consumer real estate |
| 4,696,886 |
| 73,035 |
| 6.17 |
| 4,837,100 |
| 70,650 |
| 5.80 |
| Commercial: |
| Fixed-rate |
| 856,324 |
| 9,830 |
| 4.55 |
| 980,262 |
| 11,411 |
| 4.62 |
| Variable- and adjustable-rate |
| 2,921,471 |
| 40,134 |
| 5.45 |
| 2,493,163 |
| 29,915 |
| 4.76 |
| Total commercial |
| 3,777,795 |
| 49,964 |
| 5.25 |
| 3,473,425 |
| 41,326 |
| 4.72 |
| Leasing and equipment finance |
| 4,624,968 |
| 57,844 |
| 5.00 |
| 4,316,434 |
| 48,874 |
| 4.53 |
| Inventory finance |
| 2,866,460 |
| 51,714 |
| 7.16 |
| 2,479,416 |
| 41,922 |
| 6.71 |
| Auto finance |
| 2,435,868 |
| 32,940 |
| 5.36 |
| 3,280,612 |
| 42,785 |
| 5.17 |
| Other |
| 13,547 |
| 144 |
| 4.25 |
| 11,567 |
| 146 |
| 5.03 |
| Total loans and leases |
| 18,415,524 |
| 265,641 |
| 5.73 |
| 18,398,554 |
| 245,703 |
| 5.31 |
| Total interest-earning assets |
| 21,441,621 |
| 289,296 |
| 5.36 |
| 20,504,470 |
| 261,417 |
| 5.07 |
| Other assets(5) |
| 1,462,783 |
| 1,434,957 |
| Total assets |
| $ |
| 22,904,404 |
| $ |
| 21,939,427 |
| LIABILITIES AND EQUITY: |
| Non-interest bearing deposits |
| $ |
| 3,874,421 |
| $ |
| 3,521,044 |
| Interest-bearing deposits: |
| Checking |
| 2,427,288 |
| 234 |
| 0.04 |
| 2,539,211 |
| 99 |
| 0.02 |
| Savings |
| 5,620,161 |
| 4,994 |
| 0.35 |
| 4,846,090 |
| 932 |
| 0.08 |
| Money market |
| 1,496,223 |
| 2,941 |
| 0.78 |
| 2,106,814 |
| 2,478 |
| 0.47 |
| Certificates of deposit |
| 4,868,286 |
| 19,166 |
| 1.56 |
| 4,636,007 |
| 13,506 |
| 1.16 |
| Total interest-bearing deposits |
| 14,411,958 |
| 27,335 |
| 0.75 |
| 14,128,122 |
| 17,015 |
| 0.48 |
| Total deposits |
| 18,286,379 |
| 27,335 |
| 0.59 |
| 17,649,166 |
| 17,015 |
| 0.38 |
| Borrowings: |
| Short-term borrowings |
| 3,357 |
| 21 |
| 2.46 |
| 6,448 |
| 21 |
| 1.33 |
| Long-term borrowings |
| 1,351,585 |
| 10,705 |
| 3.15 |
| 983,004 |
| 6,466 |
| 2.62 |
| Total borrowings |
| 1,354,942 |
| 10,726 |
| 3.15 |
| 989,452 |
| 6,487 |
| 2.62 |
| Total interest-bearing liabilities |
| 15,766,900 |
| 38,061 |
| 0.96 |
| 15,117,574 |
| 23,502 |
| 0.62 |
| Total deposits and borrowings |
| 19,641,321 |
| 38,061 |
| 0.77 |
| 18,638,618 |
| 23,502 |
| 0.50 |
| Accrued expenses and other liabilities |
| 751,100 |
| 723,792 |
| Total liabilities |
| 20,392,421 |
| 19,362,410 |
| Total TCF Financial Corp. stockholders' equity |
| 2,488,435 |
| 2,554,667 |
| Non-controlling interest in subsidiaries |
| 23,548 |
| 22,350 |
| Total equity |
| 2,511,983 |
| 2,577,017 |
| Total liabilities and equity |
| $ |
| 22,904,404 |
| $ |
| 21,939,427 |
| Net interest income and margin |
| $ |
| 251,235 |
| 4.66 |
| $ |
| 237,915 |
| 4.61 |
| (1) |
| Interest and yields are presented on a fully tax-equivalent basis. |
| (2) |
| Annualized |
| (3) |
| The yield on tax-exempt debt securities available for sale is computed on a tax-equivalent basis using a statutory federal income tax rate of 21% and 35% for the quarters ended September 30, 2018 and 2017, respectively. |
| (4) |
| Average balances of loans and leases include non-accrual loans and leases and are presented net of unearned income. |
| (5) |
| Includes leased equipment and related initial direct costs under operating leases of $290.9 million and $249.0 million for the quarters ended September 30, 2018 and 2017, respectively. |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Average Balance Sheets, Yields and Rates (Unaudited) |
| Nine Months Ended September 30, |
| 2018 |
| 2017 |
| Average |
| Yields and |
| Average |
| Yields and |
| (Dollars in thousands) |
| Balance |
| Interest(1) |
| Rates(1)(2) |
| Balance |
| Interest(1) |
| Rates(1)(2) |
| ASSETS: |
| Investments and other |
| $ |
| 315,803 |
| $ |
| 8,722 |
| 3.69 |
| % |
| $ |
| 275,278 |
| $ |
| 8,142 |
| 3.95 |
| % |
| Debt securities held to maturity |
| 156,170 |
| 3,005 |
| 2.57 |
| 172,341 |
| 3,388 |
| 2.62 |
| Debt securities available for sale: |
| Taxable |
| 1,258,708 |
| 24,487 |
| 2.59 |
| 820,968 |
| 13,707 |
| 2.23 |
| Tax-exempt(3) |
| 824,551 |
| 16,444 |
| 2.66 |
| 689,807 |
| 16,632 |
| 3.21 |
| Loans and leases held for sale |
| 108,992 |
| 5,230 |
| 6.41 |
| 240,753 |
| 14,768 |
| 8.20 |
| Loans and leases:(4) |
| Consumer real estate: |
| Fixed-rate |
| 1,731,858 |
| 71,541 |
| 5.52 |
| 1,972,528 |
| 83,456 |
| 5.66 |
| Variable- and adjustable-rate |
| 3,013,488 |
| 143,931 |
| 6.39 |
| 2,897,509 |
| 124,381 |
| 5.74 |
| Total consumer real estate |
| 4,745,346 |
| 215,472 |
| 6.07 |
| 4,870,037 |
| 207,837 |
| 5.71 |
| Commercial: |
| Fixed-rate |
| 895,746 |
| 30,514 |
| 4.55 |
| 982,414 |
| 34,250 |
| 4.66 |
| Variable- and adjustable-rate |
| 2,798,680 |
| 111,338 |
| 5.32 |
| 2,415,999 |
| 81,504 |
| 4.51 |
| Total commercial |
| 3,694,426 |
| 141,852 |
| 5.13 |
| 3,398,413 |
| 115,754 |
| 4.55 |
| Leasing and equipment finance |
| 4,651,605 |
| 171,487 |
| 4.92 |
| 4,293,364 |
| 144,786 |
| 4.50 |
| Inventory finance |
| 3,097,290 |
| 160,047 |
| 6.91 |
| 2,632,385 |
| 123,633 |
| 6.28 |
| Auto finance |
| 2,715,192 |
| 107,857 |
| 5.31 |
| 3,050,555 |
| 109,865 |
| 4.82 |
| Other |
| 13,943 |
| 434 |
| 4.17 |
| 10,520 |
| 414 |
| 5.27 |
| Total loans and leases |
| 18,917,802 |
| 797,149 |
| 5.63 |
| 18,255,274 |
| 702,289 |
| 5.14 |
| Total interest-earning assets |
| 21,582,026 |
| 855,037 |
| 5.29 |
| 20,454,421 |
| 758,926 |
| 4.96 |
| Other assets(5) |
| 1,449,082 |
| 1,338,670 |
| Total assets |
| $ |
| 23,031,108 |
| $ |
| 21,793,091 |
| LIABILITIES AND EQUITY: |
| Non-interest bearing deposits |
| $ |
| 3,833,543 |
| $ |
| 3,465,741 |
| Interest-bearing deposits: |
| Checking |
| 2,449,723 |
| 466 |
| 0.03 |
| 2,541,384 |
| 265 |
| 0.01 |
| Savings |
| 5,520,287 |
| 11,895 |
| 0.29 |
| 4,803,310 |
| 1,971 |
| 0.05 |
| Money market |
| 1,588,210 |
| 7,970 |
| 0.67 |
| 2,236,972 |
| 7,897 |
| 0.47 |
| Certificates of deposit |
| 4,924,804 |
| 53,467 |
| 1.45 |
| 4,314,088 |
| 35,033 |
| 1.09 |
| Total interest-bearing deposits |
| 14,483,024 |
| 73,798 |
| 0.68 |
| 13,895,754 |
| 45,166 |
| 0.43 |
| Total deposits |
| 18,316,567 |
| 73,798 |
| 0.54 |
| 17,361,495 |
| 45,166 |
| 0.35 |
| Borrowings: |
| Short-term borrowings |
| 3,473 |
| 58 |
| 2.24 |
| 5,776 |
| 41 |
| 0.95 |
| Long-term borrowings |
| 1,435,088 |
| 31,792 |
| 2.96 |
| 1,220,615 |
| 19,844 |
| 2.17 |
| Total borrowings |
| 1,438,561 |
| 31,850 |
| 2.96 |
| 1,226,391 |
| 19,885 |
| 2.16 |
| Total interest-bearing liabilities |
| 15,921,585 |
| 105,648 |
| 0.89 |
| 15,122,145 |
| 65,051 |
| 0.57 |
| Total deposits and borrowings |
| 19,755,128 |
| 105,648 |
| 0.71 |
| 18,587,886 |
| 65,051 |
| 0.47 |
| Accrued expenses and other liabilities |
| 741,222 |
| 687,826 |
| Total liabilities |
| 20,496,350 |
| 19,275,712 |
| Total TCF Financial Corp. stockholders' equity |
| 2,509,625 |
| 2,494,152 |
| Non-controlling interest in subsidiaries |
| 25,133 |
| 23,227 |
| Total equity |
| 2,534,758 |
| 2,517,379 |
| Total liabilities and equity |
| $ |
| 23,031,108 |
| $ |
| 21,793,091 |
| Net interest income and margin |
| $ |
| 749,389 |
| 4.64 |
| $ |
| 693,875 |
| 4.53 |
| (1) |
| Interest and yields are presented on a fully tax-equivalent basis. |
| (2) |
| Annualized |
| (3) |
| The yield on tax-exempt debt securities available for sale is computed on a tax-equivalent basis using a statutory federal income tax rate of 21% and 35% for the nine month periods ended September 30, 2018 and 2017, respectively. |
| (4) |
| Average balances of loans and leases include non-accrual loans and leases and are presented net of unearned income. |
| (5) |
| Includes leased equipment and related initial direct costs under operating leases of $287.1 million and $210.2 million for the nine month periods ended September 30, 2018 and 2017, respectively. |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Quarterly Average Balance Sheets (Unaudited) |
| Quarter Ended |
| Change From |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, 2018 |
| Sep. 30, 2017 |
| (Dollars in thousands) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| $ |
| % |
| $ |
| % |
| ASSETS: |
| Investments and other |
| $ |
| 306,257 |
| $ |
| 309,120 |
| $ |
| 332,319 |
| $ |
| 303,958 |
| $ |
| 279,839 |
| $ |
| (2,863 |
| ) |
| (0.9 |
| )% |
| $ |
| 26,418 |
| 9.4 |
| % |
| Debt securities held to maturity |
| 153,652 |
| 155,779 |
| 159,139 |
| 163,080 |
| 166,883 |
| (2,127 |
| ) |
| (1.4 |
| ) |
| (13,231 |
| ) |
| (7.9 |
| ) |
| Debt securities available for sale: |
| Taxable |
| 1,525,665 |
| 1,262,642 |
| 981,843 |
| 831,113 |
| 825,192 |
| 263,023 |
| 20.8 |
| 700,473 |
| 84.9 |
| Tax-exempt |
| 823,854 |
| 828,131 |
| 821,642 |
| 779,964 |
| 737,859 |
| (4,277 |
| ) |
| (0.5 |
| ) |
| 85,995 |
| 11.7 |
| Loans and leases held for sale |
| 216,669 |
| 45,525 |
| 63,095 |
| 113,501 |
| 96,143 |
| 171,144 |
| N.M. |
| 120,526 |
| 125.4 |
| Loans and leases:(1) |
| Consumer real estate: |
| Fixed-rate |
| 1,694,661 |
| 1,715,289 |
| 1,786,636 |
| 1,821,240 |
| 1,872,607 |
| (20,628 |
| ) |
| (1.2 |
| ) |
| (177,946 |
| ) |
| (9.5 |
| ) |
| Variable- and adjustable-rate |
| 3,002,225 |
| 3,026,310 |
| 3,012,036 |
| 3,151,183 |
| 2,964,493 |
| (24,085 |
| ) |
| (0.8 |
| ) |
| 37,732 |
| 1.3 |
| Total consumer real estate |
| 4,696,886 |
| 4,741,599 |
| 4,798,672 |
| 4,972,423 |
| 4,837,100 |
| (44,713 |
| ) |
| (0.9 |
| ) |
| (140,214 |
| ) |
| (2.9 |
| ) |
| Commercial: |
| Fixed-rate |
| 856,324 |
| 900,462 |
| 931,275 |
| 963,703 |
| 980,262 |
| (44,138 |
| ) |
| (4.9 |
| ) |
| (123,938 |
| ) |
| (12.6 |
| ) |
| Variable- and adjustable-rate |
| 2,921,471 |
| 2,802,059 |
| 2,669,745 |
| 2,573,022 |
| 2,493,163 |
| 119,412 |
| 4.3 |
| 428,308 |
| 17.2 |
| Total commercial |
| 3,777,795 |
| 3,702,521 |
| 3,601,020 |
| 3,536,725 |
| 3,473,425 |
| 75,274 |
| 2.0 |
| 304,370 |
| 8.8 |
| Leasing and equipment finance |
| 4,624,968 |
| 4,639,703 |
| 4,690,868 |
| 4,713,015 |
| 4,316,434 |
| (14,735 |
| ) |
| (0.3 |
| ) |
| 308,534 |
| 7.1 |
| Inventory finance |
| 2,866,460 |
| 3,299,996 |
| 3,128,290 |
| 2,688,387 |
| 2,479,416 |
| (433,536 |
| ) |
| (13.1 |
| ) |
| 387,044 |
| 15.6 |
| Auto finance |
| 2,435,868 |
| 2,695,943 |
| 3,020,187 |
| 3,267,855 |
| 3,280,612 |
| (260,075 |
| ) |
| (9.6 |
| ) |
| (844,744 |
| ) |
| (25.7 |
| ) |
| Other |
| 13,547 |
| 13,845 |
| 14,446 |
| 13,007 |
| 11,567 |
| (298 |
| ) |
| (2.2 |
| ) |
| 1,980 |
| 17.1 |
| Total loans and leases |
| 18,415,524 |
| 19,093,607 |
| 19,253,483 |
| 19,191,412 |
| 18,398,554 |
| (678,083 |
| ) |
| (3.6 |
| ) |
| 16,970 |
| 0.1 |
| Total interest-earning assets |
| 21,441,621 |
| 21,694,804 |
| 21,611,521 |
| 21,383,028 |
| 20,504,470 |
| (253,183 |
| ) |
| (1.2 |
| ) |
| 937,151 |
| 4.6 |
| Other assets(2) |
| 1,462,783 |
| 1,430,621 |
| 1,453,742 |
| 1,437,126 |
| 1,434,957 |
| 32,162 |
| 2.2 |
| 27,826 |
| 1.9 |
| Total assets |
| $ |
| 22,904,404 |
| $ |
| 23,125,425 |
| $ |
| 23,065,263 |
| $ |
| 22,820,154 |
| $ |
| 21,939,427 |
| $ |
| (221,021 |
| ) |
| (1.0 |
| ) |
| $ |
| 964,977 |
| 4.4 |
| LIABILITIES AND EQUITY: |
| Non-interest bearing deposits |
| $ |
| 3,874,421 |
| $ |
| 3,879,048 |
| $ |
| 3,745,745 |
| $ |
| 3,570,846 |
| $ |
| 3,521,044 |
| $ |
| (4,627 |
| ) |
| (0.1 |
| )% |
| $ |
| 353,377 |
| 10.0 |
| % |
| Interest-bearing deposits: |
| Checking |
| 2,427,288 |
| 2,460,709 |
| 2,461,548 |
| 2,541,475 |
| 2,539,211 |
| (33,421 |
| ) |
| (1.4 |
| ) |
| (111,923 |
| ) |
| (4.4 |
| ) |
| Savings |
| 5,620,161 |
| 5,542,565 |
| 5,395,669 |
| 5,140,417 |
| 4,846,090 |
| 77,596 |
| 1.4 |
| 774,071 |
| 16.0 |
| Money market |
| 1,496,223 |
| 1,572,560 |
| 1,698,064 |
| 1,854,442 |
| 2,106,814 |
| (76,337 |
| ) |
| (4.9 |
| ) |
| (610,591 |
| ) |
| (29.0 |
| ) |
| Certificates of deposit |
| 4,868,286 |
| 4,909,422 |
| 4,998,133 |
| 5,032,085 |
| 4,636,007 |
| (41,136 |
| ) |
| (0.8 |
| ) |
| 232,279 |
| 5.0 |
| Total interest-bearing deposits |
| 14,411,958 |
| 14,485,256 |
| 14,553,414 |
| 14,568,419 |
| 14,128,122 |
| (73,298 |
| ) |
| (0.5 |
| ) |
| 283,836 |
| 2.0 |
| Total deposits |
| 18,286,379 |
| 18,364,304 |
| 18,299,159 |
| 18,139,265 |
| 17,649,166 |
| (77,925 |
| ) |
| (0.4 |
| ) |
| 637,213 |
| 3.6 |
| Borrowings: |
| Short-term borrowings |
| 3,357 |
| 3,116 |
| 3,952 |
| 3,759 |
| 6,448 |
| 241 |
| 7.7 |
| (3,091 |
| ) |
| (47.9 |
| ) |
| Long-term borrowings |
| 1,351,585 |
| 1,531,389 |
| 1,423,075 |
| 1,295,268 |
| 983,004 |
| (179,804 |
| ) |
| (11.7 |
| ) |
| 368,581 |
| 37.5 |
| Total borrowings |
| 1,354,942 |
| 1,534,505 |
| 1,427,027 |
| 1,299,027 |
| 989,452 |
| (179,563 |
| ) |
| (11.7 |
| ) |
| 365,490 |
| 36.9 |
| Total interest-bearing liabilities |
| 15,766,900 |
| 16,019,761 |
| 15,980,441 |
| 15,867,446 |
| 15,117,574 |
| (252,861 |
| ) |
| (1.6 |
| ) |
| 649,326 |
| 4.3 |
| Total deposits and borrowings |
| 19,641,321 |
| 19,898,809 |
| 19,726,186 |
| 19,438,292 |
| 18,638,618 |
| (257,488 |
| ) |
| (1.3 |
| ) |
| 1,002,703 |
| 5.4 |
| Accrued expenses and other liabilities |
| 751,100 |
| 714,488 |
| 758,157 |
| 790,850 |
| 723,792 |
| 36,612 |
| 5.1 |
| 27,308 |
| 3.8 |
| Total liabilities |
| 20,392,421 |
| 20,613,297 |
| 20,484,343 |
| 20,229,142 |
| 19,362,410 |
| (220,876 |
| ) |
| (1.1 |
| ) |
| 1,030,011 |
| 5.3 |
| Total TCF Financial Corporation stockholders' equity |
| 2,488,435 |
| 2,483,474 |
| 2,557,729 |
| 2,570,613 |
| 2,554,667 |
| 4,961 |
| 0.2 |
| (66,232 |
| ) |
| (2.6 |
| ) |
| Non-controlling interest in subsidiaries |
| 23,548 |
| 28,654 |
| 23,191 |
| 20,399 |
| 22,350 |
| (5,106 |
| ) |
| (17.8 |
| ) |
| 1,198 |
| 5.4 |
| Total equity |
| 2,511,983 |
| 2,512,128 |
| 2,580,920 |
| 2,591,012 |
| 2,577,017 |
| (145 |
| ) |
| – |
| (65,034 |
| ) |
| (2.5 |
| ) |
| Total liabilities and equity |
| $ |
| 22,904,404 |
| $ |
| 23,125,425 |
| $ |
| 23,065,263 |
| $ |
| 22,820,154 |
| $ |
| 21,939,427 |
| $ |
| (221,021 |
| ) |
| (1.0 |
| ) |
| $ |
| 964,977 |
| 4.4 |
| N.M. Not Meaningful |
| (1) |
| Average balances of loans and leases include non-accrual loans and leases and are presented net of unearned income. |
| (2) |
| Includes leased equipment and related initial direct costs under operating leases of $290.9 million, $288.4 million, $281.9 million, $267.8 million and $249.0 million for the third, second and first quarters of 2018 and the fourth and third quarters of 2017, respectively. |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Quarterly Yields and Rates(1)(2) (Unaudited) |
| Quarter Ended |
| Change From |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, |
| Sep. 30, |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| 2018 |
| 2017 |
| ASSETS: |
| Investments and other |
| 4.01 |
| % |
| 3.71 |
| % |
| 3.38 |
| % |
| 3.07 |
| % |
| 3.80 |
| % |
| 30 |
| bps |
| 21 |
| bps |
| Debt securities held to maturity |
| 2.57 |
| 2.56 |
| 2.56 |
| 2.57 |
| 2.57 |
| 1 |
| – |
| Debt securities available for sale: |
| Taxable |
| 2.76 |
| 2.59 |
| 2.37 |
| 2.25 |
| 2.24 |
| 17 |
| 52 |
| Tax-exempt(3) |
| 2.66 |
| 2.66 |
| 2.66 |
| 3.22 |
| 3.22 |
| – |
| (56 |
| ) |
| Loans and leases held for sale |
| 6.57 |
| 5.93 |
| 6.22 |
| 6.43 |
| 5.75 |
| 64 |
| 82 |
| Loans and leases: |
| Consumer real estate: |
| Fixed-rate |
| 5.46 |
| 5.52 |
| 5.58 |
| 5.61 |
| 5.61 |
| (6 |
| ) |
| (15 |
| ) |
| Variable- and adjustable-rate |
| 6.57 |
| 6.41 |
| 6.18 |
| 5.95 |
| 5.91 |
| 16 |
| 66 |
| Total consumer real estate |
| 6.17 |
| 6.09 |
| 5.96 |
| 5.83 |
| 5.80 |
| 8 |
| 37 |
| Commercial: |
| Fixed-rate |
| 4.55 |
| 4.49 |
| 4.61 |
| 5.49 |
| 4.62 |
| 6 |
| (7 |
| ) |
| Variable- and adjustable-rate |
| 5.45 |
| 5.45 |
| 5.04 |
| 4.68 |
| 4.76 |
| – |
| 69 |
| Total commercial |
| 5.25 |
| 5.21 |
| 4.93 |
| 4.90 |
| 4.72 |
| 4 |
| 53 |
| Leasing and equipment finance |
| 5.00 |
| 4.93 |
| 4.81 |
| 4.90 |
| 4.53 |
| 7 |
| 47 |
| Inventory finance |
| 7.16 |
| 6.94 |
| 6.64 |
| 6.01 |
| 6.71 |
| 22 |
| 45 |
| Auto finance |
| 5.36 |
| 5.30 |
| 5.28 |
| 5.23 |
| 5.17 |
| 6 |
| 19 |
| Other |
| 4.25 |
| 4.10 |
| 4.16 |
| 4.75 |
| 5.03 |
| 15 |
| (78 |
| ) |
| Total loans and leases |
| 5.73 |
| 5.67 |
| 5.49 |
| 5.35 |
| 5.31 |
| 6 |
| 42 |
| Total interest-earning assets |
| 5.36 |
| 5.33 |
| 5.19 |
| 5.11 |
| 5.07 |
| 3 |
| 29 |
| LIABILITIES: |
| Interest-bearing deposits: |
| Checking |
| 0.04 |
| 0.02 |
| 0.02 |
| 0.02 |
| 0.02 |
| 2 |
| 2 |
| Savings |
| 0.35 |
| 0.27 |
| 0.24 |
| 0.18 |
| 0.08 |
| 8 |
| 27 |
| Money market |
| 0.78 |
| 0.67 |
| 0.58 |
| 0.48 |
| 0.47 |
| 11 |
| 31 |
| Certificates of deposit |
| 1.56 |
| 1.43 |
| 1.36 |
| 1.28 |
| 1.16 |
| 13 |
| 40 |
| Total interest-bearing deposits |
| 0.75 |
| 0.66 |
| 0.63 |
| 0.57 |
| 0.48 |
| 9 |
| 27 |
| Total deposits |
| 0.59 |
| 0.52 |
| 0.50 |
| 0.46 |
| 0.38 |
| 7 |
| 21 |
| Borrowings: |
| Short-term borrowings |
| 2.46 |
| 2.33 |
| 1.99 |
| 1.75 |
| 1.33 |
| 13 |
| 113 |
| Long-term borrowings |
| 3.15 |
| 3.02 |
| 2.70 |
| 2.43 |
| 2.62 |
| 13 |
| 53 |
| Total borrowings |
| 3.15 |
| 3.02 |
| 2.70 |
| 2.43 |
| 2.62 |
| 13 |
| 53 |
| Total interest-bearing liabilities |
| 0.96 |
| 0.89 |
| 0.81 |
| 0.72 |
| 0.62 |
| 7 |
| 34 |
| Net interest margin |
| 4.66 |
| 4.67 |
| 4.59 |
| 4.57 |
| 4.61 |
| (1 |
| ) |
| 5 |
| (1) |
| Annualized |
| (2) |
| Yields are presented on a fully tax-equivalent basis. |
| (3) |
| The yield on tax-exempt debt securities available for sale is computed on a tax-equivalent basis using a statutory federal income tax rate of 21% beginning in the first quarter of 2018 and 35% for all prior periods. |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Summary of Credit Quality Data (Unaudited) |
| Allowance for Loan and Lease Losses |
| At Sep. 30, |
| At Jun. 30, |
| At Mar. 31, |
| At Dec. 31, |
| At Sep. 30, |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| % of |
| % of |
| % of |
| % of |
| % of |
| (Dollars in thousands) |
| Balance |
|
|
|
Portfolio |
| Balance |
|
|
|
Portfolio |
| Balance |
|
|
|
Portfolio |
| Balance |
|
|
|
Portfolio |
| Balance |
| Portfolio |
| Consumer real estate |
| $ |
| 45,258 |
| 0.92 |
| % |
| $ |
| 43,954 |
| 0.95 |
| % |
| $ |
| 47,685 |
| 1.01 |
| % |
| $ |
| 47,168 |
| 0.98 |
| % |
| $ |
| 47,838 |
| 0.97 |
| % |
| Commercial |
| 40,470 |
| 1.08 |
| 40,291 |
| 1.09 |
| 37,198 |
| 1.01 |
| 37,195 |
| 1.04 |
| 36,344 |
| 1.04 |
| Leasing and equipment finance |
| 22,926 |
| 0.50 |
| 22,247 |
| 0.48 |
| 23,182 |
| 0.50 |
| 22,528 |
| 0.47 |
| 22,771 |
| 0.48 |
| Inventory finance |
| 11,361 |
| 0.39 |
| 11,840 |
| 0.39 |
| 13,253 |
| 0.38 |
| 13,233 |
| 0.48 |
| 11,978 |
| 0.46 |
| Auto finance |
| 39,852 |
| 1.75 |
| 46,608 |
| 1.79 |
| 45,822 |
| 1.61 |
| 50,225 |
| 1.57 |
| 48,660 |
| 1.50 |
| Other |
| 754 |
| 3.57 |
| 679 |
| 3.24 |
| 563 |
| 2.84 |
| 692 |
| 3.07 |
| 653 |
| 3.19 |
| Total |
| $ |
| 160,621 |
| 0.87 |
| $ |
| 165,619 |
| 0.89 |
| $ |
| 167,703 |
| 0.87 |
| $ |
| 171,041 |
| 0.90 |
| $ |
| 168,244 |
| 0.89 |
| Changes in Allowance for Loan and Lease Losses |
| Quarter Ended |
| Change From |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, |
| Sep. 30, |
| (In thousands) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| 2018 |
| 2017 |
| Balance, beginning of period |
| $ |
| 165,619 |
| $ |
| 167,703 |
| $ |
| 171,041 |
| $ |
| 168,244 |
| $ |
| 165,620 |
| $ |
| (2,084 |
| ) |
| $ |
| (1 |
| ) |
| Charge-offs |
| (19,448 |
| ) |
| (18,188 |
| ) |
| (19,865 |
| ) |
| (23,865 |
| ) |
| (17,999 |
| ) |
| (1,260 |
| ) |
| (1,449 |
| ) |
| Recoveries |
| 12,658 |
| 5,418 |
| 5,714 |
| 5,580 |
| 9,847 |
| 7,240 |
| 2,811 |
| Net (charge-offs) recoveries |
| (6,790 |
| ) |
| (12,770 |
| ) |
| (14,151 |
| ) |
| (18,285 |
| ) |
| (8,152 |
| ) |
| 5,980 |
| 1,362 |
| Provision for credit losses |
| 2,270 |
| 14,236 |
| 11,368 |
| 22,259 |
| 14,545 |
| (11,966 |
| ) |
| (12,275 |
| ) |
| Other |
| (478 |
| ) |
| (3,550 |
| ) |
| (555 |
| ) |
| (1,177 |
| ) |
| (3,769 |
| ) |
| 3,072 |
| 3,291 |
| Balance, end of period |
| $ |
| 160,621 |
| $ |
| 165,619 |
| $ |
| 167,703 |
| $ |
| 171,041 |
| $ |
| 168,244 |
| $ |
| (4,998 |
| ) |
| $ |
| (7,623 |
| ) |
| Net Charge-offs |
| Quarter Ended |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| (Dollars in thousands) |
| Balance |
| Rate(1) |
| Balance |
| Rate(1) |
| Balance |
| Rate(1) |
| Balance |
| Rate(1) |
| Balance |
| Rate(1) |
| Consumer real estate: |
| First mortgage lien |
| $ |
| (3,721 |
| ) |
| (0.82 |
| )% |
| $ |
| 714 |
| 0.16 |
| % |
| $ |
| 790 |
| 0.16 |
| % |
| $ |
| 876 |
| 0.18 |
| % |
| $ |
| (801 |
| ) |
| (0.16 |
| )% |
| Junior lien |
| (2,709 |
| ) |
| (0.37 |
| ) |
| 64 |
| 0.01 |
| 327 |
| 0.05 |
| (218 |
| ) |
| (0.03 |
| ) |
| (2,651 |
| ) |
| (0.38 |
| ) |
| Total consumer real estate |
| (6,430 |
| ) |
| (0.55 |
| ) |
| 778 |
| 0.07 |
| 1,117 |
| 0.09 |
| 658 |
| 0.05 |
| (3,452 |
| ) |
| (0.29 |
| ) |
| Commercial |
| (8 |
| ) |
| – |
| (27 |
| ) |
| – |
| (14 |
| ) |
| – |
| (378 |
| ) |
| (0.04 |
| ) |
| (196 |
| ) |
| (0.02 |
| ) |
| Leasing and equipment finance |
| 1,930 |
| 0.17 |
| 2,106 |
| 0.18 |
| 1,340 |
| 0.11 |
| 4,775 |
| 0.41 |
| 1,046 |
| 0.10 |
| Inventory finance |
| 637 |
| 0.09 |
| 517 |
| 0.06 |
| 409 |
| 0.05 |
| 995 |
| 0.15 |
| 469 |
| 0.08 |
| Auto finance |
| 9,485 |
| 1.56 |
| 8,516 |
| 1.26 |
| 10,656 |
| 1.41 |
| 11,111 |
| 1.36 |
| 9,248 |
| 1.13 |
| Other |
| 1,176 |
| N.M. |
| 880 |
| N.M. |
| 643 |
| N.M. |
| 1,124 |
| N.M. |
| 1,037 |
| N.M. |
| Total |
| $ |
| 6,790 |
| 0.15 |
| $ |
| 12,770 |
| 0.27 |
| $ |
| 14,151 |
| 0.29 |
| $ |
| 18,285 |
| 0.38 |
| $ |
| 8,152 |
| 0.18 |
| N.M. Not Meaningful |
| (1) Annualized net charge-off rate based on average loans and leases |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Summary of Credit Quality Data (Unaudited), Continued |
| Over 60-Day Delinquencies as a Percentage of Portfolio(1) |
| Change From |
| At Sep. 30, |
| At Jun. 30, |
| At Mar. 31, |
| At Dec. 31, |
| At Sep. 30, |
| Jun. 30, |
| Sep. 30, |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| 2018 |
| 2017 |
| Consumer real estate: |
| First mortgage lien |
| 0.18 |
| % |
| 0.20 |
| % |
| 0.23 |
| % |
| 0.25 |
| % |
| 0.32 |
| % |
| (2 |
| ) |
| bps |
| (14 |
| ) |
| bps |
| Junior lien |
| 0.04 |
| 0.07 |
| 0.06 |
| 0.04 |
| 0.05 |
| (3 |
| ) |
| (1 |
| ) |
| Total consumer real estate |
| 0.10 |
| 0.12 |
| 0.13 |
| 0.13 |
| 0.15 |
| (2 |
| ) |
| (5 |
| ) |
| Commercial |
| – |
| – |
| – |
| – |
| – |
| – |
| – |
| Leasing and equipment finance |
| 0.15 |
| 0.11 |
| 0.11 |
| 0.14 |
| 0.15 |
| 4 |
| – |
| Inventory finance |
| – |
| – |
| – |
| 0.01 |
| 0.01 |
| – |
| (1 |
| ) |
| Auto finance |
| 0.41 |
| 0.33 |
| 0.24 |
| 0.28 |
| 0.25 |
| 8 |
| 16 |
| Other |
| 0.30 |
| 0.16 |
| 0.24 |
| 0.04 |
| 0.07 |
| 14 |
| 23 |
| Subtotal |
| 0.11 |
| 0.11 |
| 0.09 |
| 0.11 |
| 0.12 |
| – |
| (1 |
| ) |
| Portfolios acquired with deteriorated credit quality |
| 16.70 |
| 13.48 |
| 12.95 |
| 13.18 |
| 9.42 |
| 322 |
| 728 |
| Total delinquencies |
| 0.12 |
| 0.11 |
| 0.10 |
| 0.12 |
| 0.13 |
| 1 |
| (1 |
| ) |
|
(1) Excludes non-accrual loans and leases |
| Non-performing Assets |
| Change From |
| At Sep. 30, |
| At Jun. 30, |
| At Mar. 31, |
| At Dec. 31, |
| At Sep. 30, |
| Jun. 30, |
| Sep. 30, |
| (Dollars in thousands) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| 2018 |
| 2017 |
| Non-accrual loans and leases: |
| Consumer real estate |
| $ |
| 55,092 |
| $ |
| 49,155 |
| $ |
| 84,237 |
| $ |
| 83,224 |
| $ |
| 80,731 |
| $ |
| 5,937 |
| $ |
| (25,639 |
| ) |
| Commercial |
| 9,888 |
| 9,978 |
| 11,401 |
| 6,785 |
| 10,337 |
| (90 |
| ) |
| (449 |
| ) |
| Leasing and equipment finance |
| 16,061 |
| 16,300 |
| 19,968 |
| 17,089 |
| 18,720 |
| (239 |
| ) |
| (2,659 |
| ) |
| Inventory finance |
| 1,640 |
| 2,093 |
| 3,621 |
| 4,116 |
| 3,178 |
| (453 |
| ) |
| (1,538 |
| ) |
| Auto finance |
| 7,613 |
| 7,312 |
| 7,199 |
| 7,366 |
| 6,653 |
| 301 |
| 960 |
| Other |
| 2 |
| 21 |
| 2 |
| 2 |
| – |
| (19 |
| ) |
| 2 |
|
Total non-accrual loans and leases |
| 90,296 |
| 84,859 |
| 126,428 |
| 118,582 |
| 119,619 |
| 5,437 |
| (29,323 |
| ) |
| Other real estate owned |
| 19,079 |
| 16,266 |
| 17,179 |
| 18,225 |
| 26,405 |
| 2,813 |
| (7,326 |
| ) |
| Total non-performing assets |
| $ |
| 109,375 |
| $ |
| 101,125 |
| $ |
| 143,607 |
| $ |
| 136,807 |
| $ |
| 146,024 |
| $ |
| 8,250 |
| $ |
| (36,649 |
| ) |
| Non-accrual loans and leases as a percentage of total loans and leases |
| 0.49 |
| % |
| 0.46 |
| % |
| 0.65 |
| % |
| 0.62 |
| % |
| 0.63 |
| % |
| 3 |
| bps |
| (14 |
| ) |
| bps |
| Non-performing assets as a percentage of total loans and leases and other real estate owned |
| 0.59 |
| 0.54 |
| 0.74 |
| 0.72 |
| 0.77 |
| 5 |
| (18 |
| ) |
| Allowance for loan and lease losses as a percentage of non-accrual loans and leases |
| 177.88 |
| 195.17 |
| 132.65 |
| 144.24 |
| 140.65 |
| (1,729 |
| ) |
| 3,723 |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Consolidated Capital Information (Unaudited) |
| At or For the Quarter Ended |
| Change From |
| (Dollars in thousands, except per share data) |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| Jun. 30, |
| Sep. 30, |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| 2018 |
| 2017 |
| Dividends declared per common share |
| $ |
| 0.15 |
| $ |
| 0.15 |
| $ |
| 0.15 |
| $ |
| 0.075 |
| $ |
| 0.075 |
| – |
| % |
| 100.0 |
| % |
| Book value per common share |
| 14.01 |
| 13.79 |
| 13.89 |
| 13.96 |
| 13.45 |
| 1.6 |
| 4.2 |
| Tangible book value per common share(1) |
| 12.96 |
| 12.73 |
| 12.84 |
| 12.92 |
| 11.99 |
| 1.8 |
| 8.1 |
| Common equity ratio |
| 10.21 |
| % |
| 9.97 |
| % |
| 10.06 |
| % |
| 10.42 |
| % |
| 10.04 |
| % |
| 24 |
| bps |
| 17 |
| bps |
| Tangible common equity ratio(1) |
| 9.51 |
| 9.28 |
| 9.37 |
| 9.72 |
| 9.06 |
| 23 |
| 45 |
| Regulatory Capital:(2) |
| Common equity Tier 1 capital |
| $ |
| 2,226,820 |
| $ |
| 2,186,528 |
| $ |
| 2,222,390 |
| $ |
| 2,242,410 |
| $ |
| 2,080,729 |
| 1.8 |
| % |
| 7.0 |
| % |
| Tier 1 capital |
| 2,412,869 |
| 2,375,210 |
| 2,414,838 |
| 2,522,178 |
| 2,362,926 |
| 1.6 |
| 2.1 |
| Total capital |
| 2,754,615 |
| 2,728,076 |
| 2,786,637 |
| 2,889,323 |
| 2,734,260 |
| 1.0 |
| 0.7 |
| Common equity Tier 1 capital ratio |
| 11.04 |
| % |
| 10.60 |
| % |
| 10.57 |
| % |
| 10.79 |
| % |
| 10.05 |
| % |
| 44 |
| bps |
| 99 |
| bps |
| Tier 1 risk-based capital ratio |
| 11.96 |
| 11.51 |
| 11.49 |
| 12.14 |
| 11.41 |
| 45 |
| 55 |
| Total risk-based capital ratio |
| 13.66 |
| 13.22 |
| 13.26 |
| 13.90 |
| 13.21 |
| 44 |
| 45 |
| Tier 1 leverage ratio |
| 10.58 |
| 10.31 |
| 10.52 |
| 11.12 |
| 10.88 |
| 27 |
| (30 |
| ) |
| (1) |
| See "Reconciliation of GAAP to Non-GAAP Financial Measures" tables |
| (2) |
| September 30, 2018 amounts are preliminary pending completion and filing of the Company's regulatory reports |
| Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited) |
| Computation of adjusted diluted earnings per common share: |
| Quarter Ended |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| (Dollars in thousands, except per share data) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| Net income available to common stockholders |
| $ |
| 83,702 |
| $ |
| 56,255 |
| $ |
| 66,174 |
| $ |
| 97,653 |
| $ |
| 48,285 |
| Less: Earnings allocated to participating securities |
| 13 |
| 8 |
| 9 |
| 17 |
| 8 |
| Earnings allocated to common stock |
| (a) |
| 83,689 |
| 56,247 |
| 66,165 |
| 97,636 |
| 48,277 |
| Plus: BCFP/OCC settlement adjustment |
| – |
| 32,000 |
| – |
| – |
| – |
| Less: Income tax expense attributable to BCFP/OCC settlement adjustment |
| – |
| 6,491 |
| – |
| – |
| – |
| Adjusted earnings allocated to common stock |
| (b) |
| $ |
| 83,689 |
| $ |
| 81,756 |
| $ |
| 66,165 |
| $ |
| 97,636 |
| $ |
| 48,277 |
| Weighted-average common shares outstanding for diluted earnings per common share |
| (c) |
| 165,533,225 |
| 166,857,640 |
| 169,997,146 |
| 170,068,986 |
| 169,240,251 |
| Diluted earnings per common share |
| (a) / (c) |
| $ |
| 0.51 |
| $ |
| 0.34 |
| $ |
| 0.39 |
| $ |
| 0.57 |
| $ |
| 0.29 |
| Adjusted diluted earnings per common share |
| (b) / (c) |
| 0.51 |
| 0.49 |
| 0.39 |
| 0.57 |
| 0.29 |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited), Continued |
| Computation of adjusted return on average common equity, return on average tangible common equity and adjusted return on average tangible common equity: |
| Quarter Ended |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| (Dollars in thousands) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| Net income available to common stockholders |
| (a) |
| $ |
| 83,702 |
| $ |
| 56,255 |
| $ |
| 66,174 |
| $ |
| 97,653 |
| $ |
| 48,285 |
| Plus: Goodwill impairment |
| – |
| – |
| – |
| 73,041 |
| – |
| Plus: Other intangibles amortization and impairment |
| 913 |
| 835 |
| 831 |
| 1,187 |
| 806 |
| Less: Income tax expense attributable to other intangibles amortization and impairment |
| 220 |
| 201 |
| 199 |
| 530 |
| 277 |
| Adjusted net income available to common stockholders |
| (b) |
| $ |
| 84,395 |
| $ |
| 56,889 |
| $ |
| 66,806 |
| $ |
| 171,351 |
| $ |
| 48,814 |
| Net income available to common stockholders adjusted for BCFP/OCC settlement: |
| Net income available to common stockholders |
| $ |
| 83,702 |
| $ |
| 56,255 |
| $ |
| 66,174 |
| $ |
| 97,653 |
| $ |
| 48,285 |
| Plus: BCFP/OCC settlement adjustment |
| – |
| 32,000 |
| – |
| – |
| – |
| Less: Income tax expense attributable to BCFP/OCC settlement adjustment |
| – |
| 6,491 |
| – |
| – |
| – |
| Net income available to common stockholders adjusted for BCFP/OCC settlement |
| (c) |
| 83,702 |
| 81,764 |
| 66,174 |
| 97,653 |
| 48,285 |
| Plus: Goodwill impairment |
| – |
| – |
| – |
| 73,041 |
| – |
| Plus: Other intangibles amortization and impairment |
| 913 |
| 835 |
| 831 |
| 1,187 |
| 806 |
| Less: Income tax expense attributable to other intangibles amortization and impairment |
| 220 |
| 201 |
| 199 |
| 530 |
| 277 |
| Adjusted net income available to common stockholders adjusted for BCFP/OCC settlement |
| (d) |
| $ |
| 84,395 |
| $ |
| 82,398 |
| $ |
| 66,806 |
| $ |
| 171,351 |
| $ |
| 48,814 |
| Average balances: |
| Total equity |
| $ |
| 2,511,983 |
| $ |
| 2,512,128 |
| $ |
| 2,580,920 |
| $ |
| 2,591,012 |
| $ |
| 2,577,017 |
| Less: Non-controlling interest in subsidiaries |
| 23,548 |
| 28,654 |
| 23,191 |
| 20,399 |
| 22,350 |
| Total TCF Financial Corporation stockholders' equity |
| 2,488,435 |
| 2,483,474 |
| 2,557,729 |
| 2,570,613 |
| 2,554,667 |
| Less: Preferred stock |
| 169,302 |
| 169,302 |
| 200,404 |
| 265,821 |
| 265,556 |
| Average total common stockholders' equity |
| (e) |
| 2,319,133 |
| 2,314,172 |
| 2,357,325 |
| 2,304,792 |
| 2,289,111 |
| Less: |
| Goodwill, net |
| 154,757 |
| 154,757 |
| 154,757 |
| 197,734 |
| 227,539 |
| Other intangibles, net |
| 21,798 |
| 22,672 |
| 23,274 |
| 21,901 |
| 22,279 |
| Average tangible common stockholders' equity |
| (f) |
| $ |
| 2,142,578 |
| $ |
| 2,136,743 |
| $ |
| 2,179,294 |
| $ |
| 2,085,157 |
| $ |
| 2,039,293 |
| Average total common stockholders' equity adjusted for BCFP/OCC settlement: |
| Average total common stockholders' equity |
| $ |
| 2,319,133 |
| $ |
| 2,314,172 |
| $ |
| 2,357,325 |
| $ |
| 2,304,792 |
| $ |
| 2,289,111 |
| Plus: BCFP/OCC settlement adjustment to average total common stockholders' equity |
| – |
| 4,205 |
| – |
| – |
| – |
| Average total common stockholders' equity adjusted for BCFP/OCC settlement |
| (g) |
| 2,319,133 |
| 2,318,377 |
| 2,357,325 |
| 2,304,792 |
| 2,289,111 |
| Less: |
| Goodwill, net |
| 154,757 |
| 154,757 |
| 154,757 |
| 197,734 |
| 227,539 |
| Other intangibles, net |
| 21,798 |
| 22,672 |
| 23,274 |
| 21,901 |
| 22,279 |
| Adjusted average tangible common stockholders' equity |
| (h) |
| $ |
| 2,142,578 |
| $ |
| 2,140,948 |
| $ |
| 2,179,294 |
| $ |
| 2,085,157 |
| $ |
| 2,039,293 |
| ROACE(1) |
| (a) / (e) |
| 14.44 |
| % |
| 9.72 |
| % |
| 11.23 |
| % |
| 16.95 |
| % |
| 8.44 |
| % |
| Adjusted ROACE(1) |
| (c) / (g) |
| 14.44 |
| 14.11 |
| 11.23 |
| 16.95 |
| 8.44 |
| ROATCE(1) |
| (b) / (f) |
| 15.76 |
| 10.65 |
| 12.26 |
| 32.87 |
| 9.57 |
| Adjusted ROATCE(1) |
| (d) / (h) |
| 15.76 |
| 15.39 |
| 12.26 |
| 32.87 |
| 9.57 |
|
(1) Annualized |
| TCF FINANCIAL CORPORATION AND SUBSIDIARIES |
| Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited), Continued |
| Computation of adjusted efficiency ratio: |
| Quarter Ended |
| Sep. 30, |
| Jun. 30, |
| Mar. 31, |
| Dec. 31, |
| Sep. 30, |
| (Dollars in thousands) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| Total non-interest expense |
| (a) |
| $ |
| 246,423 |
| $ |
| 272,039 |
| $ |
| 245,980 |
| $ |
| 347,806 |
| $ |
| 235,035 |
| Less: BCFP/OCC settlement adjustment |
| – |
| 32,000 |
| – |
| – |
| – |
| Adjusted non-interest expense |
| (b) |
| $ |
| 246,423 |
| $ |
| 240,039 |
| $ |
| 245,980 |
| $ |
| 347,806 |
| $ |
| 235,035 |
| Revenue |
| (c) |
| $ |
| 365,566 |
| $ |
| 364,902 |
| $ |
| 355,403 |
| $ |
| 362,752 |
| $ |
| 343,333 |
| Efficiency ratio |
| (a) / (c) |
| 67.41 |
| % |
| 74.55 |
| % |
| 69.21 |
| % |
| 95.88 |
| % |
| 68.46 |
| % |
| Adjusted efficiency ratio |
| (b) / (c) |
| 67.41 |
| 65.78 |
| 69.21 |
| 95.88 |
| 68.46 |
| Computation of tangible common equity ratio and tangible book value per common share: |
| At Sep. 30, |
| At Jun. 30, |
| At Mar. 31, |
| At Dec. 31, |
| At Sep. 30, |
| (Dollars in thousands, except per share data) |
| 2018 |
| 2018 |
| 2018 |
| 2017 |
| 2017 |
| Total equity |
| $ |
| 2,528,012 |
| $ |
| 2,504,578 |
| $ |
| 2,550,950 |
| $ |
| 2,680,584 |
| $ |
| 2,596,514 |
| Less: Non-controlling interest in subsidiaries |
| 21,154 |
| 23,646 |
| 28,437 |
| 17,827 |
| 19,906 |
| Total TCF Financial Corporation stockholders' equity |
| 2,506,858 |
| 2,480,932 |
| 2,522,513 |
| 2,662,757 |
| 2,576,608 |
| Less: Preferred stock |
| 169,302 |
| 169,302 |
| 169,302 |
| 265,821 |
| 265,967 |
| Total common stockholders' equity |
| (d) |
| 2,337,556 |
| 2,311,630 |
| 2,353,211 |
| 2,396,936 |
| 2,310,641 |
| Less: |
| Goodwill, net |
| 154,757 |
| 154,757 |
| 154,757 |
| 154,757 |
| 227,798 |
| Other intangibles, net |
| 21,364 |
| 22,247 |
| 23,112 |
| 23,687 |
| 21,874 |
| Tangible common stockholders' equity |
| (e) |
| $ |
| 2,161,435 |
| $ |
| 2,134,626 |
| $ |
| 2,175,342 |
| $ |
| 2,218,492 |
| $ |
| 2,060,969 |
| Total assets |
| (f) |
| $ |
| 22,904,785 |
| $ |
| 23,184,462 |
| $ |
| 23,385,052 |
| $ |
| 23,002,159 |
| $ |
| 23,005,038 |
| Less: |
| Goodwill, net |
| 154,757 |
| 154,757 |
| 154,757 |
| 154,757 |
| 227,798 |
| Other intangibles, net |
| 21,364 |
| 22,247 |
| 23,112 |
| 23,687 |
| 21,874 |
| Tangible assets |
| (g) |
| $ |
| 22,728,664 |
| $ |
| 23,007,458 |
| $ |
| 23,207,183 |
| $ |
| 22,823,715 |
| $ |
| 22,755,366 |
| Common stock shares outstanding |
| (h) |
| 166,812,524 |
| 167,684,971 |
| 169,415,834 |
| 171,669,419 |
| 171,833,926 |
| Common equity ratio |
| (d) / (f) |
| 10.21 |
| % |
| 9.97 |
| % |
| 10.06 |
| % |
| 10.42 |
| % |
| 10.04 |
| % |
| Tangible common equity ratio |
| (e) / (g) |
| 9.51 |
| 9.28 |
| 9.37 |
| 9.72 |
| 9.06 |
| Book value per common share |
| (d) / (h) |
| $ |
| 14.01 |
| $ |
| 13.79 |
| $ |
| 13.89 |
| $ |
| 13.96 |
| $ |
| 13.45 |
| Tangible book value per common share |
| (e) / (h) |
| 12.96 |
| 12.73 |
| 12.84 |
| 12.92 |
| 11.99 |
Click here to subscribe to news release email alerts for TCF Financial Corporation.
View source version on businesswire.com: https://www.businesswire.com/news/home/20181022005446/en/
TCF Financial Corporation
Mark Goldman, 952-475-7050 (Media)
news@tcfbank.com
or
Timothy
Sedabres, 952-745-2766 (Investors)
investor@tcfbank.com