TCF Reports First Quarter 2020 Results

TCF also announces quarterly cash dividends on common and preferred stock

DETROIT--()--TCF Financial Corporation (NASDAQ: TCF):

First Quarter 2020 Highlights

  • Quarterly net income of $51.9 million, or $0.32 per diluted share, down 53.8% from the fourth quarter of 2019
  • Adjusted diluted earnings per common share of $0.57(1), down 45.2% from the fourth quarter of 2019. Adjusted diluted earnings per common share excludes $38.0 million, or $0.25 per share, after-tax impact of merger-related expenses and notable items
  • Loan and lease growth of 4.1% compared to December 31, 2019, driven by $1.2 billion of commercial loan and lease portfolio growth
  • Deposit growth of 3.9% compared to December 31, 2019
  • Net charge-offs of $5.5 million, or 0.06% of average loans and leases (annualized)
  • Provision for credit losses of $96.9 million, including $74.1 million related to COVID-19, a $0.38 detriment to earnings per diluted common share
  • Assisted consumers via approximately 7,300 COVID-19-related loan modification requests for $825 million as of April 23, 2020
  • Assisted business and commercial customers via $1.2 billion of approved loans through the Payment Protection Program as of April 23, 2020
  • Efficiency ratio of 69.57%, improved 392 basis points from the fourth quarter of 2019. Adjusted efficiency ratio of 58.24%(1), improved 27 basis points from the fourth quarter of 2019
  • Common equity Tier 1 capital ratio of 10.44%
  • Repurchased 873 thousand common shares at a cost of $33.1 million in the first quarter of 2020; in response to the COVID-19 pandemic, TCF temporarily suspended buybacks under its share repurchase program, but retains the ability to reinstate as circumstances warrant
  • Declared quarterly cash dividends on common stock of $0.35 per share payable on June 1, 2020

Merger-related Expenses and Notable items in the First Quarter of 2020 and Fourth Quarter of 2019(1)

  • Pre-tax merger-related expenses of $36.7 million, $29.0 million net of tax, or $0.19 per diluted common share for the first quarter of 2020, compared to pre-tax merger-related expenses of $47.0 million, $36.1 million net of tax, or $0.24 per diluted common share for the fourth quarter of 2019
  • Pre-tax expenses of $11.3 million, $8.9 million net of tax, or $0.06 per diluted common share related to notable items for the first quarter of 2020, compared to pre-tax net expenses of $22.1 million, $13.1 million net of tax, or $0.08 per diluted common share related to notable items for the fourth quarter of 2019, see summary of notable items adjustments below

(1)

Denotes a non-GAAP financial measure. See "Reconciliation of GAAP to Non-GAAP Financial Measures" tables and the following table detailing merger-related expenses and notable items.

Note: TCF’s financial results for periods ended prior to August 1, 2019 reflect Legacy TCF financial results only on a standalone basis. In addition, TCF’s reported financial results for the first, second and third quarter of 2019 reflect Legacy TCF financial results for the period before August 1, 2019 and the post-merger combined TCF financial results on and after August 1, 2019, with the fourth quarter of 2019 and first quarter of 2020 financial results being solely of the post-merger combined TCF. The number of shares issued and outstanding, earnings per share, additional paid-in-capital, dividends paid and all references to share quantities of TCF have been retrospectively restated to reflect the equivalent number of shares issued in the Merger as the Merger was treated as a reverse merger.

Summary of Financial Results(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

At or For the Quarter Ended

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

Mar. 31,

(Dollars in thousands, except per share data)

2020

 

2019

 

2019

 

2019

 

2019

 

2019

2019

Financial Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to TCF

$

51,899

 

 

$

112,399

 

 

$

22,148

 

 

$

90,427

 

 

$

70,494

 

 

(53.8

)

%

(26.4

)

%

Net interest income

401,481

 

 

408,753

 

 

371,793

 

 

254,057

 

 

254,429

 

 

(1.8

)

 

57.8

 

 

Basic earnings per common share

$

0.33

 

 

$

0.72

 

 

$

0.15

 

 

$

1.07

 

 

$

0.83

 

 

(54.2

)

 

(60.2

)

 

Diluted earnings per common share

0.32

 

 

0.72

 

 

0.15

 

 

1.07

 

 

0.83

 

 

(55.6

)

 

(61.4

)

 

Return on average assets ("ROAA")(3)

0.46

%

 

0.99

%

 

0.26

%

 

1.54

%

 

1.22

%

 

(53

)

bps

(76

)

bps

ROACE(3)

3.64

 

 

8.00

 

 

1.75

 

 

14.27

 

 

11.40

 

 

(436

)

 

(776

)

 

ROATCE (non-GAAP)(2)(3)

5.42

 

 

11.35

 

 

2.68

 

 

15.46

 

 

12.42

 

 

(593

)

 

(700

)

 

Net interest margin

3.73

 

 

3.86

 

 

4.12

 

 

4.46

 

 

4.58

 

 

(13

)

 

(85

)

 

Net interest margin (FTE)(2)(3)

3.76

 

 

3.89

 

 

4.14

 

 

4.49

 

 

4.61

 

 

(13

)

 

(85

)

 

Net charge-offs as a percentage of average loans and leases(3)

0.06

 

 

0.07

 

 

0.39

 

 

0.29

 

 

0.39

 

 

(1

)

 

(33

)

 

Nonperforming assets as a percentage of total loans and leases and other real estate owned(4)

0.80

 

 

0.59

 

 

0.62

 

 

0.62

 

 

0.63

 

 

21

 

 

17

 

 

Efficiency ratio

69.57

 

 

73.49

 

 

91.32

 

 

65.11

 

 

70.70

 

 

(392

)

 

(113

)

 

Adjusted Financial Results (non-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income attributable to TCF(2)

$

89,855

 

 

$

161,581

 

 

$

128,301

 

 

$

93,650

 

 

$

77,700

 

 

(44.4

)

%

15.6

 

%

Adjusted diluted earnings per common share(2)

$

0.57

 

 

$

1.04

 

 

$

0.98

 

 

$

1.11

 

 

$

0.91

 

 

(45.2

)

 

(37.4

)

 

Adjusted ROAA(2)(3)

0.78

%

 

1.42

%

 

1.34

%

 

1.59

%

 

1.34

%

 

(64

)

bps

(56

)

bps

Adjusted ROACE(2)(3)

6.43

 

 

11.57

 

 

11.21

 

 

14.79

 

 

12.61

 

 

(514

)

 

(618

)

 

Adjusted ROATCE(2)(3)

9.24

 

 

16.25

 

 

14.96

 

 

16.02

 

 

13.72

 

 

(701

)

 

(448

)

 

Adjusted efficiency ratio(2)

58.24

 

 

58.51

 

 

58.74

 

 

61.48

 

 

65.67

 

 

(27

)

 

(743

)

 

N.M. Not meaningful

(1)

Financial results for any periods ended prior to August 1, 2019 reflect Legacy TCF financials on a standalone basis. Certain reclassifications have been made to prior period financial information to conform to the current period presentation.

(2)

Denotes a non-GAAP financial measure. See "Reconciliation of GAAP to Non-GAAP Financial Measures" tables.

(3)

Annualized.

(4)

Prior to the adoption of CECL as of January 1, 2020, purchased credit impaired loans were not classified as nonaccrual loans because they were recorded at their net realizable value based on the principal and interest expected to be collected on the loans. At January 1, 2020, $73.4 million of previous purchased credit impaired loans were reclassified to nonaccrual loans as a result of the adoption of CECL.

The following table includes merger-related expenses and notable items used to arrive at adjusted net income in the Adjusted Financial Results (non-GAAP) (see Reconciliation of Non-GAAP Financial Measures).

 

For the Quarter Ended March 31, 2020

 

For the Quarter Ended December 31, 2019

(Dollars in thousands, except per share data)

Pre-tax
income (loss)

 

After-tax
benefit (loss)(1)

 

Per Share

 

Pre-tax
income (loss)

 

After-tax
benefit (loss)(1)

 

Per Share

Merger-related expenses

$

(36,728

)

 

$

(29,026

)

 

$

(0.19

)

 

$

(47,025

)

 

(36,059

)

 

$

(0.24

)

Notable items:

 

 

 

 

 

 

 

 

 

 

 

Sale of Legacy TCF auto finance portfolio and related expenses(2)

(3,063

)

 

(2,421

)

 

(0.02

)

 

(12,864

)

 

(9,865

)

 

(0.06

)

Branch exit costs(3)

 

 

 

 

 

 

(3,494

)

 

(2,679

)

 

(0.02

)

Loan servicing rights (impairment) recovery(4)

(8,236

)

 

(6,509

)

 

(0.04

)

 

638

 

 

490

 

 

 

Pension fair valuation adjustment(4)

 

 

 

 

 

 

(6,341

)

 

(4,862

)

 

(0.03

)

Tax basis adjustment benefit(5)

 

 

 

 

 

 

 

 

3,793

 

 

0.03

 

Total notable items

(11,299

)

 

(8,930

)

 

(0.06

)

 

(22,061

)

 

(13,123

)

 

(0.08

)

Total merger-related and notable items

$

(48,027

)

 

$

(37,956

)

 

$

(0.25

)

 

$

(69,086

)

 

$

(49,182

)

 

$

(0.32

)

(1)

Net of tax benefit at our normal tax rate and other tax benefits.

(2)

First quarter of 2020 included within occupancy and equipment ($1.6 million), compensation and employee benefits ($0.9 million) and other noninterest expense ($0.6 million). Fourth quarter of 2019 included within net (loss) gain on sales of loans and leases ($8.2 million), other noninterest expense ($2.2 million), occupancy and equipment ($1.5 million) and compensation and employee benefits ($0.9 million).

(3)

Included within Other noninterest expense.

(4)

Included within Other noninterest income.

(5)

Included within Income tax expense.

TCF Financial Corporation ("TCF" or the "Corporation") (NASDAQ: TCF) today reported net income of $51.9 million, or diluted earnings per common share of $0.32, for the first quarter of 2020, compared with $112.4 million, or diluted earnings per common share of $0.72, for the fourth quarter of 2019. Adjusted net income was $89.9 million, or $0.57 per diluted common share for the first quarter of 2020, compared with $161.6 million, or $1.04 per diluted common share, for the fourth quarter of 2019. (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables).

"As we work through the impacts related to COVID-19, I am continually impressed with the dedication of our teams and how our team members have rallied to support our customers as well as each other during these unprecedented times," said Craig R. Dahl, president and chief executive officer. “Our top priorities continue to be on ensuring the health and well-being of our team members, the financial stability of our customers, and the overall wellness of the communities where we live and operate.

“We entered the year with momentum across the company and in January and February, we saw strong business performance that reflected the opportunity we see in our markets as a result of our merger of equals, including robust loan and deposit growth, stable credit quality and on-time execution of our integration initiatives. With the arrival of COVID-19, we quickly took numerous actions to prioritize the well-being of those we work with, both from a health and economic perspective. This included transitioning our branch services to drive-up only where possible, closing select other nearby branches, and implementing a work-from-home approach for many of our team members, all of which were designed to protect the health and safety of our employees. In addition, we are offering relief programs for impacted customers and we have deployed substantial resources to support applications for the Paycheck Protection Program.

“As we look ahead, our focus will remain on managing the impact of COVID-19 across the organization, completing our integration activities and capturing the related cost synergies, and continuing to actively manage the business in this volatile and fluid environment. We are operating with robust capital and liquidity levels, strong diversification across our portfolios as a result of the merger of equals, and an experienced management team that is providing strong leadership as we support our customers and employees in these difficult times.”

Net Interest Income and Net Interest Margin

Net interest income was $401.5 million for the first quarter of 2020, a decrease of $7.3 million, or 1.8%, from the fourth quarter of 2019. Purchase accounting accretion and amortization included in net interest income was $25.3 million for the first quarter of 2020, compared to $30.5 million for the fourth quarter of 2019. Net interest income, excluding purchase accounting accretion and amortization, was $376.2 million for the first quarter of 2020, compared to $378.2 million for the fourth quarter of 2019. Net interest margin was 3.73% for the first quarter of 2020, compared to 3.86% in the fourth quarter of 2019, while net interest margin on a fully tax-equivalent basis (FTE) was 3.76%, down 13 basis points from the fourth quarter of 2019. The decrease in net interest margin from the fourth quarter of 2019 was driven primarily by the Federal Reserve's rate cuts in addition to a decrease in the benefit provided by purchase accounting accretion and amortization. Net interest margin FTE, excluding purchase accounting accretion and amortization, was 3.53% in the first quarter of 2020, compared to 3.60% in the fourth quarter of 2019 (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables).

Noninterest Income

Noninterest income was $137.0 million for the first quarter of 2020, a decrease of $21.1 million, or 13.3%, from the fourth quarter of 2019. Noninterest income for the first quarter of 2020 included an $8.2 million loan servicing rights impairment, included in other noninterest income, a notable item. Noninterest income for the fourth quarter of 2019 included the following notable items: an $8.2 million loss related to the sale of the Legacy TCF auto finance portfolio, included in net gains (losses) on sales of loans and leases, and a $0.6 million recovery of prior loan servicing rights impairment, included in other noninterest income. Adjusted noninterest income for the first quarter of 2020 was $145.2 million, compared to $165.6 million in the fourth quarter of 2019 (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables). The first quarter of 2020 also included a $6.0 million favorable interest rate swap mark-to-market adjustment resulting from changes in the interest rate environment, included in other noninterest income, a $7.7 million increase in net gains on sales of loans and leases, and decreases of $13.1 million in leasing revenue, primarily due to a seasonal decline in sales-type leasing revenue, and of $4.8 million and $3.1 million in service charges on deposit accounts and card and ATM revenue, respectively. The fourth quarter of 2019 included a $3.7 million gain on sale of loans and leases related to a nonaccrual and TDR loan sale, included in net gains (losses) on sales of loans and leases and a $2.4 million favorable interest rate swap mark-to-market adjustment resulting from changes in the interest rate environment, included in other noninterest income.

Noninterest Expense

Noninterest expense was $374.6 million for the first quarter of 2020, a decrease of $42.0 million, or 10.1%, from the fourth quarter of 2019. The first quarter of 2020 included $36.7 million of merger-related expenses, compared to $47.0 million for the fourth quarter of 2019. Noninterest expense also included $3.1 million of expense related to the sale of the Legacy TCF auto finance portfolio ($1.6 million in occupancy and equipment expense, $0.9 million in compensation and employee benefits and $0.6 million in other noninterest expense) considered a notable item for the first quarter of 2020. Noninterest expense for the fourth quarter of 2019 included the following notable items: $6.3 million of expense related to pension fair valuation adjustment on plans with previously announced terminations, included in other noninterest expense, $4.6 million of expense related to the sale of the Legacy TCF auto finance portfolio ($2.2 million in other noninterest expense, $1.5 million in occupancy and equipment expense and $0.9 million in compensation and employee benefits) and $3.5 million of expense related to branch exit costs, included in other noninterest expense. Excluding merger-related expenses and notable items, adjusted noninterest expense was $334.8 million for the first quarter of 2020, compared to $355.0 million for the fourth quarter of 2019 (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables). The first quarter of 2020 also included $1.5 million of impairment related to federal historic tax credits placed into service, included in other noninterest expense. The fourth quarter of 2019 also included $4.0 million of impairment related to federal historic tax credits placed into service, included in other noninterest expense, and a $1.3 million impairment charge recognized on a branch we intend to sell in the future, included within occupancy and equipment expense.

Income Tax Expense

Income tax expense for the first quarter of 2020 was $13.1 million, a decrease of $8.3 million, or 38.8%, from the fourth quarter of 2019. The fourth quarter of 2019 included a $3.6 million federal historic tax credit benefit and a $3.8 million tax basis adjustment benefit.

Credit Quality

Provision for credit losses Provision for credit losses was $96.9 million for the first quarter of 2020, an increase of $82.5 million, from the fourth quarter of 2019. The increase from the fourth quarter of 2019 was primarily due to the recognition of an economic downturn related to COVID-19 (increased provision for credit losses on loans and leases by $74.1 million, $70.5 million related to the provision for credit losses on loans and leases and $3.6 million related to the provision for unfunded commitments) and the adoption of a new accounting standard, often referred to as Current Expected Credit Losses ("CECL"). This framework requires that management estimate credit losses over the full remaining expected life and consider expected future changes in macroeconomic conditions. As a result of the adoption of CECL, the provision for credit losses now includes the provision for unfunded commitment that was previously included within other noninterest expense. The first quarter of 2020 provision for unfunded commitments was $4.0 million. Provision for credit losses for the fourth quarter of 2019 was reduced by $4.7 million of recoveries of previous charge-offs related to the sale of consumer nonaccrual and TDR loans.

Net charge-off rate The annualized net charge-offs as a percentage of average loans and leases was 0.06% for the first quarter of 2020, down 1 basis point from the fourth quarter of 2019. Net charge-offs for the fourth quarter of 2019 were reduced by $4.7 million of recoveries of previous charge-offs related to the sale of consumer nonaccrual and TDR loans.

Allowance for Credit Losses Allowance for credit losses was $406.4 million, or 1.13% of total loans and leases, at March 31, 2020, up from $113.1 million, or 0.33%, at December 31, 2019. The increase from December 31, 2019 was primarily due to the adoption of CECL and the impact of COVID-19 (increased the allowance for credit losses by $70.5 million) and the adoption of CECL as of January 1, 2020. Upon adoption of CECL, $206.0 million was recorded as an increase in the allowance for credit losses. Prior to the adoption of CECL, the allowance for credit losses was calculated under an incurred loss model which delayed recognition of loss until it was probable the loss had been incurred in comparison to the accounting under CECL which considers current credit losses expected to be incurred in the loan and lease portfolios over the life of each financial asset.

Nonaccrual loans and leases Nonaccrual loans and leases were $250.5 million at March 31, 2020 and represented 0.70% of total loans and leases, compared to $169.7 million, or 0.49% of total loans and leases, at December 31, 2019. The $80.8 million increase in nonaccrual loans and leases from December 31, 2019 was substantially driven by the adoption of CECL ($73.4 million of loans previously accounted for as purchased credit impaired were reclassified to nonaccrual loans as of January 1, 2020 due to the adoption of CECL).

Balance Sheet

Loans and leases Loans and leases were $35.9 billion at March 31, 2020, an increase of $1.4 billion, or 4.1%, compared to $34.5 billion at December 31, 2019. The increase from December 31, 2019 was primarily due to growth in the commercial and industrial, commercial real estate and residential mortgage portfolios.

Investment securities The investment securities portfolio was $7.2 billion at March 31, 2020, an increase of $301.4 million, or 4.4%, compared to $6.9 billion at December 31, 2019. The increase from December 31, 2019 was primarily due to purchases of residential agency mortgage-backed securities.

Deposits Deposits were $35.8 billion at March 31, 2020, an increase of $1.3 billion, or 3.9%, compared to $34.5 billion at December 31, 2019. The increase from December 31, 2019 was primarily due to increases in money market deposits of $535.2 million, checking deposit account balances of $322.9 million and savings account balances of $197.8 million, reflecting seasonal increases in addition to lower consumer spending.

Capital The common equity Tier 1 capital ratio was 10.44% at March 31, 2020, compared to 10.99% at December 31, 2019. Our capital ratios as of March 31, 2020 reflect our election of the five-year CECL transition for regulatory capital purposes.

In response to the COVID-19 pandemic, TCF temporarily suspended buybacks under its share repurchase program, but retains the ability to reinstate as circumstances warrant. TCF is well positioned with strong capital and liquidity and is committed to supporting our customers, team members and communities.

TCF's board of directors also declared a regular quarterly cash dividend of $0.35 per common share payable on June 1, 2020 to shareholders of record at the close of business on May 15, 2020. In addition, the board of directors declared a quarterly cash dividend of $0.35625 per depositary share payable on June 1, 2020 to shareholders of record of the depositary shares, representing a 1/1,000th interest in a share of the 5.70% Series C Non-Cumulative Perpetual Preferred Stock, at the close of business on May 15, 2020.

Conference Call Details TCF will host a conference call to discuss first quarter 2020 results on Tuesday, April 28, 2020 at 10:00 a.m. Eastern Time. The conference call will be available via a live webcast on the Investor Relations section of TCF's website, ir.tcfbank.com, and archived for replay. The conference call can also be accessed by dialing (844) 512-2926 and entering access code 6598992. To listen to the replay via phone, please dial (877) 344-7529 and enter access code 10141568. The replay begins approximately one hour after the call is completed on Tuesday, April 28, 2020 and will be available through Tuesday, May 5, 2020.

TCF Financial Corporation (NASDAQ: TCF) is a Detroit, Michigan-based financial holding company with $49 billion in total assets at March 31, 2020 and a top 10 deposit market share in the Midwest. TCF’s primary banking subsidiary, TCF National Bank, is a premier Midwest bank offering consumer and commercial banking, trust and wealth management, and specialty leasing and lending products and services to consumers, small businesses and commercial clients. TCF has approximately 500 branches primarily located in Michigan, Illinois and Minnesota with additional locations in Arizona, Colorado, Ohio, South Dakota and Wisconsin. TCF also conducts business across all 50 states and Canada through its specialty lending and leasing businesses. To learn more about TCF, visit 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 Corporation's businesses and their respective markets, such as projections of future performance, targets, guidance, statements of the Corporation's plans and objectives, forecasts of market trends and other matters are forward-looking statements based on the Corporation'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 Corporation'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 Corporation's Annual Report on Form 10-K for the year ended December 31, 2019 under the heading "Risk Factors" or otherwise disclosed in documents filed or furnished by the Corporation with or to the SEC after the filing of such Annual Report on Form 10-K, 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.

This release also contains forward-looking statements regarding TCF’s outlook or expectations with respect to the merger. Examples of forward-looking statements include, but are not limited to, statements regarding outlook and expectations with respect to the strategic and financial benefits of the merger, including the expected impact of the transaction on TCF’s future financial performance (including anticipated accretion to earnings per share, the tangible book value earn-back period and other operating and return metrics), the expected costs to be incurred in connection with the merger, and operational aspects of post-merger integration.

Use of Non-GAAP Financial Measures

Management uses the adjusted net income, adjusted diluted earnings per common share, adjusted ROAA, adjusted ROACE, ROATCE, adjusted ROATCE, adjusted efficiency ratio, adjusted net interest income, net interest margin (FTE), adjusted net interest margin (FTE), adjusted noninterest income, adjusted noninterest expense, tangible book value per common share and tangible common equity to tangible assets 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 Corporation's capital and ability to withstand unexpected market or economic conditions and to assess the performance of the Corporation in relation to other banking institutions on the same basis as that applied by management, analysts and banking regulators. TCF adjusts certain results to exclude merger-related expenses and notable items in addition to presenting net interest income and net interest margin (FTE) excluding purchase accounting accretion and amortization. Management believes these measures are useful to investors in understanding TCF's business and operating results.

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 corporation, 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 shareholders. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measure may be found in the reconciliation tables included in this press release.

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

 

Consolidated Statements of Financial Condition (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change From

(Dollars in thousands)

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31, 2019

Mar. 31, 2019

2020

 

2019

 

2019

 

2019

 

2019

 

$

%

$

%

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

$

713,413

 

 

$

491,787

 

 

$

586,060

 

 

$

294,566

 

 

$

283,659

 

 

$

221,626

 

45.1

%

$

429,754

 

151.5

%

Interest-bearing deposits with other banks

565,458

 

 

736,584

 

 

736,954

 

 

260,705

 

 

180,163

 

 

(171,126

)

(23.2

)

385,295

 

N.M.

 

Total cash and cash equivalents

1,278,871

 

 

1,228,371

 

 

1,323,014

 

 

555,271

 

 

463,822

 

 

50,500

 

4.1

 

815,049

 

175.7

 

Federal Home Loan Bank and Federal Reserve Bank stocks, at cost

484,461

 

 

442,440

 

 

290,238

 

 

105,659

 

 

103,644

 

 

42,021

 

9.5

 

380,817

 

N.M.

 

Investment securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale, at fair value

7,025,224

 

 

6,720,001

 

 

5,579,835

 

 

3,109,803

 

 

2,945,342

 

 

305,223

 

4.5

 

4,079,882

 

138.5

 

Held-to-maturity, at amortized cost

135,619

 

 

139,445

 

 

144,000

 

 

144,919

 

 

148,024

 

 

(3,826

)

(2.7

)

(12,405

)

(8.4

)

Total investment securities

7,160,843

 

 

6,859,446

 

 

5,723,835

 

 

3,254,722

 

 

3,093,366

 

 

301,397

 

4.4

 

4,067,477

 

131.5

 

Loans and leases held-for-sale

287,177

 

 

199,786

 

 

1,436,069

 

 

74,410

 

 

64,468

 

 

87,391

 

43.7

 

222,709

 

N.M.

 

Loans and leases

35,921,614

 

 

34,497,464

 

 

33,510,752

 

 

19,185,137

 

 

19,384,210

 

 

1,424,150

 

4.1

 

16,537,404

 

85.3

 

Allowance for credit losses

(406,383

)

 

(113,052

)

 

(121,218

)

 

(146,503

)

 

(147,972

)

 

(293,331

)

N.M.

 

(258,411

)

(174.6

)

Loans and leases, net

35,515,231

 

 

34,384,412

 

 

33,389,534

 

 

19,038,634

 

 

19,236,238

 

 

1,130,819

 

3.3

 

16,278,993

 

84.6

 

Premises and equipment, net

516,454

 

 

533,138

 

 

554,194

 

 

432,751

 

 

429,711

 

 

(16,684

)

(3.1

)

86,743

 

20.2

 

Goodwill

1,313,046

 

 

1,299,878

 

 

1,265,111

 

 

154,757

 

 

154,757

 

 

13,168

 

1.0

 

1,158,289

 

N.M.

 

Other intangible assets, net

162,887

 

 

168,368

 

 

215,910

 

 

18,885

 

 

19,684

 

 

(5,481

)

(3.3

)

143,203

 

N.M.

 

Loan servicing rights

47,283

 

 

56,313

 

 

55,301

 

 

19

 

 

20

 

 

(9,030

)

(16.0

)

47,263

 

N.M.

 

Other assets

1,828,130

 

 

1,479,401

 

 

1,439,305

 

 

991,722

 

 

853,005

 

 

348,729

 

23.6

 

975,125

 

114.3

 

Total assets

$

48,594,383

 

 

$

46,651,553

 

 

$

45,692,511

 

 

$

24,626,830

 

 

$

24,418,715

 

 

$

1,942,830

 

4.2

 

$

24,175,668

 

99.0

 

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing

$

8,237,916

 

 

$

7,970,590

 

 

$

7,979,900

 

 

$

4,062,912

 

 

$

4,104,652

 

 

$

267,326

 

3.4

%

$

4,133,264

 

100.7

%

Interest-bearing

27,561,387

 

 

26,497,873

 

 

27,306,174

 

 

15,049,475

 

 

14,919,459

 

 

1,063,514

 

4.0

 

12,641,928

 

84.7

 

Total deposits

35,799,303

 

 

34,468,463

 

 

35,286,074

 

 

19,112,387

 

 

19,024,111

 

 

1,330,840

 

3.9

 

16,775,192

 

88.2

 

Short-term borrowings

3,482,535

 

 

2,669,145

 

 

2,607,300

 

 

350,764

 

 

355,992

 

 

813,390

 

30.5

 

3,126,543

 

N.M.

 

Long-term borrowings

2,600,594

 

 

2,354,448

 

 

860,482

 

 

1,617,531

 

 

1,411,426

 

 

246,146

 

10.5

 

1,189,168

 

84.3

 

Other liabilities

1,056,118

 

 

1,432,256

 

 

1,245,238

 

 

835,630

 

 

981,341

 

 

(376,138

)

(26.3

)

74,777

 

7.6

 

Total liabilities

42,938,550

 

 

40,924,312

 

 

39,999,094

 

 

21,916,312

 

 

21,772,870

 

 

2,014,238

 

4.9

 

21,165,680

 

97.2

 

Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

169,302

 

 

169,302

 

 

169,302

 

 

169,302

 

 

169,302

 

 

 

 

 

 

Common stock

152,186

 

 

152,966

 

 

153,571

 

 

87,944

 

 

88,063

 

 

(780

)

(0.5

)

64,123

 

72.8

 

Additional paid-in capital

3,433,234

 

 

3,462,080

 

 

3,478,159

 

 

781,788

 

 

789,467

 

 

(28,846

)

(0.8

)

2,643,767

 

N.M.

 

Retained earnings

1,732,932

 

 

1,896,427

 

 

1,840,214

 

 

1,874,308

 

 

1,810,701

 

 

(163,495

)

(8.6

)

(77,769

)

(4.3

)

Accumulated other comprehensive income

166,170

 

 

54,277

 

 

56,228

 

 

37,334

 

 

5,481

 

 

111,893

 

N.M.

 

160,689

 

N.M.

 

Treasury stock at cost and other

(28,140

)

 

(28,037

)

 

(27,370

)

 

(265,016

)

 

(246,621

)

 

(103

)

(0.4

)

218,481

 

88.6

 

Total TCF Financial Corporation shareholders' equity

5,625,684

 

 

5,707,015

 

 

5,670,104

 

 

2,685,660

 

 

2,616,393

 

 

(81,331

)

(1.4

)

3,009,291

 

115.0

 

Non-controlling interest

30,149

 

 

20,226

 

 

23,313

 

 

24,858

 

 

29,452

 

 

9,923

 

49.1

 

697

 

2.4

 

Total equity

5,655,833

 

 

5,727,241

 

 

5,693,417

 

 

2,710,518

 

 

2,645,845

 

 

(71,408

)

(1.2

)

3,009,988

 

113.8

 

Total liabilities and equity

$

48,594,383

 

 

$

46,651,553

 

 

$

45,692,511

 

 

$

24,626,830

 

 

$

24,418,715

 

 

$

1,942,830

 

4.2

 

$

24,175,668

 

99.0

 

 

N.M. Not Meaningful

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

 

 

 

 

Consolidated Statements of Income (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

(Dollars in thousands)

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31, 2019

 

Mar. 31, 2019

2020

 

2019

 

2019

 

2019

 

2019

 

$

 

%

 

$

 

%

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans and leases

$

443,096

 

 

$

446,738

 

 

$

417,370

 

 

$

283,282

 

 

$

283,238

 

 

$

(3,642

)

 

(0.8

)%

 

$

159,858

 

 

56.4

%

Interest on investment securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

40,920

 

 

36,282

 

 

31,038

 

 

22,041

 

 

16,666

 

 

4,638

 

 

12.8

 

 

24,254

 

 

145.5

 

Tax-exempt

4,349

 

 

4,374

 

 

3,385

 

 

1,208

 

 

2,684

 

 

(25

)

 

(0.6

)

 

1,665

 

 

62.0

 

Interest on loans held-for-sale

1,561

 

 

15,767

 

 

1,408

 

 

599

 

 

825

 

 

(14,206

)

 

(90.1

)

 

736

 

 

89.2

 

Interest on other earning assets

5,466

 

 

6,617

 

 

6,607

 

 

3,651

 

 

3,481

 

 

(1,151

)

 

(17.4

)

 

1,985

 

 

57.0

 

Total interest income

495,392

 

 

509,778

 

 

459,808

 

 

310,781

 

 

306,894

 

 

(14,386

)

 

(2.8

)

 

188,498

 

 

61.4

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

67,419

 

 

77,003

 

 

70,900

 

 

40,646

 

 

37,608

 

 

(9,584

)

 

(12.4

)

 

29,811

 

 

79.3

 

Interest on borrowings

26,492

 

 

24,022

 

 

17,115

 

 

16,078

 

 

14,857

 

 

2,470

 

 

10.3

 

 

11,635

 

 

78.3

 

Total interest expense

93,911

 

 

101,025

 

 

88,015

 

 

56,724

 

 

52,465

 

 

(7,114

)

 

(7.0

)

 

41,446

 

 

79.0

 

Net interest income

401,481

 

 

408,753

 

 

371,793

 

 

254,057

 

 

254,429

 

 

(7,272

)

 

(1.8

)

 

147,052

 

 

57.8

 

Provision for credit losses

96,943

 

 

14,403

 

 

27,188

 

 

13,569

 

 

10,122

 

 

82,540

 

 

N.M.

 

 

86,821

 

 

N.M.

 

Net interest income after provision for credit losses

304,538

 

 

394,350

 

 

344,605

 

 

240,488

 

 

244,307

 

 

(89,812

)

 

(22.8

)

 

60,231

 

 

24.7

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fees and service charges on deposit accounts

34,597

 

 

39,356

 

 

34,384

 

 

27,842

 

 

26,278

 

 

(4,759

)

 

(12.1

)

 

8,319

 

 

31.7

 

Leasing revenue

33,565

 

 

46,686

 

 

39,590

 

 

39,277

 

 

38,165

 

 

(13,121

)

 

(28.1

)

 

(4,600

)

 

(12.1

)

Card and ATM revenue

21,685

 

 

24,751

 

 

23,315

 

 

20,496

 

 

18,659

 

 

(3,066

)

 

(12.4

)

 

3,026

 

 

16.2

 

Net gains (losses) on sales of loans and leases

20,590

 

 

12,934

 

 

(5,984

)

 

11,141

 

 

8,217

 

 

7,656

 

 

59.2

 

 

12,373

 

 

150.6

 

Servicing fee revenue

6,792

 

 

6,022

 

 

5,121

 

 

4,523

 

 

5,110

 

 

770

 

 

12.8

 

 

1,682

 

 

32.9

 

Wealth management revenue

6,151

 

 

6,172

 

 

4,241

 

 

 

 

 

 

(21

)

 

(0.3

)

 

6,151

 

 

N.M.

 

Net gains on investment securities

 

 

8

 

 

5,900

 

 

1,066

 

 

451

 

 

(8

)

 

(100.0

)

 

(451

)

 

(100.0

)

Other

13,583

 

 

22,123

 

 

(12,309

)

 

5,373

 

 

6,624

 

 

(8,540

)

 

(38.6

)

 

6,959

 

 

105.1

 

Total noninterest income

136,963

 

 

158,052

 

 

94,258

 

 

109,718

 

 

103,504

 

 

(21,089

)

 

(13.3

)

 

33,459

 

 

32.3

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and employee benefits

171,528

 

 

180,969

 

 

155,745

 

 

116,266

 

 

123,942

 

 

(9,441

)

 

(5.2

)

 

47,586

 

 

38.4

 

Occupancy and equipment

57,288

 

 

56,771

 

 

49,229

 

 

41,850

 

 

41,710

 

 

517

 

 

0.9

 

 

15,578

 

 

37.3

 

Lease financing equipment depreciation

18,450

 

 

18,629

 

 

19,408

 

 

19,133

 

 

19,256

 

 

(179

)

 

(1.0

)

 

(806

)

 

(4.2

)

Net foreclosed real estate and repossessed assets

1,859

 

 

4,242

 

 

2,203

 

 

2,448

 

 

4,630

 

 

(2,383

)

 

(56.2

)

 

(2,771

)

 

(59.8

)

Merger-related expenses

36,728

 

 

47,025

 

 

111,259

 

 

4,226

 

 

9,458

 

 

(10,297

)

 

(21.9

)

 

27,270

 

 

N.M.

 

Other

88,746

 

 

108,935

 

 

87,776

 

 

52,926

 

 

54,079

 

 

(20,189

)

 

(18.5

)

 

34,667

 

 

64.1

 

Total noninterest expense

374,599

 

 

416,571

 

 

425,620

 

 

236,849

 

 

253,075

 

 

(41,972

)

 

(10.1

)

 

121,524

 

 

48.0

 

Income before income tax expense

66,902

 

 

135,831

 

 

13,243

 

 

113,357

 

 

94,736

 

 

(68,929

)

 

(50.7

)

 

(27,834

)

 

(29.4

)

Income tax expense (benefit)

13,086

 

 

21,375

 

 

(11,735

)

 

19,314

 

 

21,287

 

 

(8,289

)

 

(38.8

)

 

(8,201

)

 

(38.5

)

Income after income tax expense

53,816

 

 

114,456

 

 

24,978

 

 

94,043

 

 

73,449

 

 

(60,640

)

 

(53.0

)

 

(19,633

)

 

(26.7

)

Income attributable to non-controlling interest

1,917

 

 

2,057

 

 

2,830

 

 

3,616

 

 

2,955

 

 

(140

)

 

(6.8

)

 

(1,038

)

 

(35.1

)

Net income attributable to TCF Financial Corporation

51,899

 

 

112,399

 

 

22,148

 

 

90,427

 

 

70,494

 

 

(60,500

)

 

(53.8

)

 

(18,595

)

 

(26.4

)

Preferred stock dividends

2,493

 

 

2,494

 

 

2,494

 

 

2,494

 

 

2,493

 

 

(1

)

 

 

 

 

 

 

Net income available to common shareholders

$

49,406

 

 

$

109,905

 

 

$

19,654

 

 

$

87,933

 

 

$

68,001

 

 

$

(60,499

)

 

(55.0

)

 

$

(18,595

)

 

(27.3

)

 

N.M. Not Meaningful

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Average Balance Sheets, Yields and Rates (Unaudited)

 

Quarter Ended

 

Mar. 31, 2020

 

Dec. 31, 2019

 

Mar. 31, 2019

 

Average

 

Yields &

 

Average

 

Yields &

 

Average

 

Yields &

(Dollars in thousands)

Balance

Interest(1)

Rates(1)(2)

 

Balance

Interest(1)

Rates(1)(2)

 

Balance

Interest(1)

Rates(1)(2)

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank and Federal Reserve Bank stocks

$

454,675

 

$

3,152

 

2.79

%

 

$

388,640

 

$

3,170

 

3.24

%

 

$

105,135

 

$

961

 

3.70

%

Investment securities held-to-maturity

136,277

 

560

 

1.64

 

 

140,434

 

889

 

2.53

 

 

147,556

 

535

 

1.45

 

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

Taxable

5,892,006

 

40,360

 

2.74

 

 

4,960,520

 

35,393

 

2.85

 

 

2,121,196

 

16,131

 

3.04

 

Tax-exempt(3)

773,468

 

5,503

 

2.85

 

 

778,994

 

5,536

 

2.84

 

 

516,995

 

3,397

 

2.63

 

Loans and leases held-for-sale

138,058

 

1,561

 

4.53

 

 

1,121,326

 

15,767

 

5.58

 

 

55,204

 

825

 

6.05

 

Loans and leases(3)(4)

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

11,827,315

 

160,802

 

5.42

 

 

10,955,937

 

156,246

 

5.63

 

 

6,495,163

 

106,716

 

6.63

 

Commercial real estate

9,291,540

 

117,743

 

5.01

 

 

9,057,834

 

124,431

 

5.38

 

 

2,917,631

 

37,737

 

5.17

 

Lease financing

2,682,323

 

34,156

 

5.09

 

 

2,616,360

 

33,431

 

5.11

 

 

2,527,346

 

32,384

 

5.13

 

Residential mortgage

6,113,279

 

61,379

 

4.02

 

 

6,023,647

 

61,072

 

4.05

 

 

2,345,881

 

29,458

 

5.07

 

Consumer installment

1,517,412

 

19,742

 

5.23

 

 

1,546,952

 

19,382

 

4.97

 

 

1,852,813

 

25,500

 

5.58

 

Home equity

3,514,278

 

51,103

 

5.85

 

 

3,604,153

 

53,910

 

5.93

 

 

3,048,128

 

52,452

 

6.98

 

Total loans and leases(3)(4)

34,946,147

 

444,925

 

5.08

 

 

33,804,883

 

448,472

 

5.24

 

 

19,186,962

 

284,247

 

5.97

 

Interest-bearing deposits with banks and other

538,971

 

2,314

 

1.72

 

 

656,555

 

3,448

 

2.07

 

 

261,556

 

2,520

 

3.87

 

Total interest-earning assets

42,879,602

 

498,375

 

4.64

 

 

41,851,352

 

512,675

 

4.85

 

 

22,394,604

 

308,616

 

5.55

 

Other assets

4,105,824

 

 

 

 

4,268,162

 

 

 

 

1,712,337

 

 

 

Total assets

$

46,985,426

 

 

 

 

$

46,119,514

 

 

 

 

$

24,106,941

 

 

 

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

$

7,929,933

 

 

 

 

$

7,968,769

 

 

 

 

$

3,919,746

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

Checking

5,990,309

 

5,830

 

0.39

%

 

5,891,566

 

7,614

 

0.51

%

 

2,457,767

 

387

 

0.06

%

Savings

8,589,815

 

13,669

 

0.64

 

 

8,404,460

 

14,993

 

0.71

 

 

6,253,992

 

10,670

 

0.69

 

Money market

4,792,248

 

14,855

 

1.25

 

 

4,463,476

 

15,537

 

1.38

 

 

1,490,631

 

4,453

 

1.21

 

Certificates of deposit

7,329,632

 

33,065

 

1.81

 

 

7,825,573

 

38,859

 

1.97

 

 

4,622,120

 

22,098

 

1.94

 

Total interest-bearing deposits

26,702,004

 

67,419

 

1.02

 

 

26,585,075

 

77,003

 

1.15

 

 

14,824,510

 

37,608

 

1.03

 

Total deposits

34,631,937

 

67,419

 

0.78

 

 

34,553,844

 

77,003

 

0.88

 

 

18,744,256

 

37,608

 

0.81

 

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

2,689,262

 

10,582

 

1.56

 

 

2,585,682

 

11,403

 

1.73

 

 

293,499

 

1,957

 

2.67

 

Long-term borrowings

2,608,204

 

15,910

 

2.42

 

 

1,739,852

 

12,620

 

2.87

 

 

1,500,832

 

12,900

 

3.44

 

Total borrowings

5,297,466

 

26,492

 

1.98

 

 

4,325,534

 

24,023

 

2.19

 

 

1,794,331

 

14,857

 

3.31

 

Total interest-bearing liabilities

31,999,470

 

93,911

 

1.18

 

 

30,910,609

 

101,026

 

1.29

 

 

16,618,841

 

52,465

 

1.28

 

Total deposits and borrowings

39,929,403

 

93,911

 

0.94

 

 

38,879,378

 

101,026

 

1.03

 

 

20,538,587

 

52,465

 

1.03

 

Accrued expenses and other liabilities

1,425,536

 

 

 

 

1,549,017

 

 

 

 

989,104

 

 

 

Total liabilities

41,354,939

 

 

 

 

40,428,395

 

 

 

 

21,527,691

 

 

 

Total TCF Financial Corporation shareholders' equity

5,605,159

 

 

 

 

5,667,436

 

 

 

 

2,554,729

 

 

 

Non-controlling interest in subsidiaries

25,328

 

 

 

 

23,683

 

 

 

 

24,521

 

 

 

Total equity

5,630,487

 

 

 

 

5,691,119

 

 

 

 

2,579,250

 

 

 

Total liabilities and equity

$

46,985,426

 

 

 

 

$

46,119,514

 

 

 

 

$

24,106,941

 

 

 

Net interest spread (FTE)

 

 

3.70

%

 

 

 

3.82

%

 

 

 

4.52

%

Net interest income(FTE) and net interest margin(FTE)

 

$

404,464

 

3.76

%

 

 

$

411,649

 

3.89

%

 

 

$

256,151

 

4.61

%

Reconciliation to Reported Net Interest Income

 

 

 

 

 

 

 

 

 

Net interest income (FTE)

 

$

404,464

 

 

 

 

$

411,649

 

 

 

 

$

256,151

 

 

Adjustments for taxable equivalent

interest(1)(3)

 

 

 

 

 

 

 

 

 

 

 

Loans and leases

 

(1,829

)

 

 

 

(1,734

)

 

 

 

(1,009

)

 

Tax-exempt investment securities

 

(1,154

)

 

 

 

(1,162

)

 

 

 

(713

)

 

Total FTE adjustments

 

(2,983

)

 

 

 

(2,896

)

 

 

 

(1,722

)

 

Net interest income (GAAP)

 

$

401,481

 

 

 

 

$

408,753

 

 

 

 

$

254,429

 

 

Net interest margin (GAAP)

 

3.73

%

 

 

 

3.86

%

 

 

 

4.58

%

 

(1)

Interest and yields are presented on a fully tax-equivalent basis.

(2)

Annualized.

(3)

The yield on tax-exempt loans and investment securities available-for-sale is computed on a tax-equivalent basis using a statutory federal income tax rate of 21%.

(4)

Average balances of loans and leases include nonaccrual loans and leases and are presented net of unearned income.

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

 

 

 

 

Consolidated Quarterly Average Balance Sheets (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31, 2019

 

Mar. 31, 2019

(Dollars in thousands)

2020

 

2019

 

2019

 

2019

 

2019

 

$

 

%

 

$

 

%

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank and Federal Reserve Bank stocks

$

454,675

 

 

$

388,640

 

 

$

230,767

 

 

$

112,118

 

 

$

105,135

 

 

$

66,035

 

 

17.0

%

 

$

349,540

 

 

N.M.

 

Investment securities held-to-maturity

136,277

 

 

140,434

 

 

143,078

 

 

146,296

 

 

147,556

 

 

(4,157

)

 

(3.0

)

 

(11,279

)

 

(7.6

)%

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

5,892,006

 

 

4,960,520

 

 

4,232,878

 

 

2,711,984

 

 

2,121,196

 

 

931,486

 

 

18.8

 

 

3,770,810

 

 

177.8

 

Tax-exempt

773,468

 

 

778,994

 

 

643,576

 

 

222,534

 

 

516,995

 

 

(5,526

)

 

(0.7

)

 

256,473

 

 

49.6

 

Loans and leases held-for-sale

138,058

 

 

1,121,326

 

 

118,482

 

 

40,835

 

 

55,204

 

 

(983,268

)

 

(87.7

)

 

82,854

 

 

150.1

 

Loans and leases(1) :

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

11,827,315

 

 

10,955,937

 

 

9,290,978

 

 

6,683,060

 

 

6,495,163

 

 

871,378

 

 

8.0

 

 

5,332,152

 

 

82.1

 

Commercial real estate

9,291,540

 

 

9,057,834

 

 

6,964,643

 

 

3,069,969

 

 

2,917,631

 

 

233,706

 

 

2.6

 

 

6,373,909

 

 

N.M.

 

Lease financing

2,682,323

 

 

2,616,360

 

 

2,570,567

 

 

2,565,175

 

 

2,527,346

 

 

65,963

 

 

2.5

 

 

154,977

 

 

6.1

 

Residential mortgage

6,113,279

 

 

6,023,647

 

 

4,853,627

 

 

2,337,818

 

 

2,345,881

 

 

89,632

 

 

1.5

 

 

3,767,398

 

 

160.6

 

Consumer installment

1,517,412

 

 

1,546,952

 

 

2,389,830

 

 

1,586,633

 

 

1,852,813

 

 

(29,540

)

 

(1.9

)

 

(335,401

)

 

(18.1

)

Home equity

3,514,278

 

 

3,604,153

 

 

3,433,830

 

 

2,997,050

 

 

3,048,128

 

 

(89,875

)

 

(2.5

)

 

466,150

 

 

15.3

 

Total loans and leases(1)

34,946,147

 

 

33,804,883

 

 

29,503,475

 

 

19,239,705

 

 

19,186,962

 

 

1,141,264

 

 

3.4

 

 

15,759,185

 

 

82.1

 

Interest-bearing deposits with banks and other

538,971

 

 

656,555

 

 

933,014

 

 

280,075

 

 

261,556

 

 

(117,584

)

 

(17.9

)

 

277,415

 

 

106.1

 

Total interest-earning assets

42,879,602

 

 

41,851,352

 

 

35,805,270

 

 

22,753,547

 

 

22,394,604

 

 

1,028,250

 

 

2.5

 

 

20,484,998

 

 

91.5

 

Other assets

4,105,824

 

 

4,268,162

 

 

3,289,096

 

 

1,730,275

 

 

1,712,337

 

 

(162,338

)

 

(3.8

)

 

2,393,487

 

 

139.8

 

Total assets

$

46,985,426

 

 

$

46,119,514

 

 

$

39,094,366

 

 

$

24,483,822

 

 

$

24,106,941

 

 

$

865,912

 

 

1.9

 

 

$

22,878,485

 

 

94.9

 

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

$

7,929,933

 

 

$

7,968,769

 

 

$

6,564,195

 

 

$

3,980,811

 

 

$

3,919,746

 

 

$

(38,836

)

 

(0.5

)

 

$

4,010,187

 

 

102.3

%

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

5,990,309

 

 

5,891,566

 

 

4,805,843

 

 

2,479,814

 

 

2,457,767

 

 

98,743

 

 

1.7

 

 

3,532,542

 

 

143.7

 

Savings

8,589,815

 

 

8,404,460

 

 

7,676,165

 

 

6,452,510

 

 

6,253,992

 

 

185,355

 

 

2.2

 

 

2,335,823

 

 

37.3

 

Money market

4,792,248

 

 

4,463,476

 

 

3,490,922

 

 

1,430,556

 

 

1,490,631

 

 

328,772

 

 

7.4

 

 

3,301,617

 

 

N.M.

 

Certificates of deposit

7,329,632

 

 

7,825,573

 

 

7,320,720

 

 

4,527,822

 

 

4,622,120

 

 

(495,941

)

 

(6.3

)

 

2,707,512

 

 

58.6

 

Total interest-bearing deposits

26,702,004

 

 

26,585,075

 

 

23,293,650

 

 

14,890,702

 

 

14,824,510

 

 

116,929

 

 

0.4

 

 

11,877,494

 

 

80.1

 

Total deposits

34,631,937

 

 

34,553,844

 

 

29,857,845

 

 

18,871,513

 

 

18,744,256

 

 

78,093

 

 

0.2

 

 

15,887,681

 

 

84.8

 

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

2,689,262

 

 

2,585,682

 

 

1,884,228

 

 

321,043

 

 

293,499

 

 

103,580

 

 

4.0

 

 

2,395,763

 

 

N.M.

 

Long-term borrowings

2,608,204

 

 

1,739,852

 

 

1,472,150

 

 

1,657,527

 

 

1,500,832

 

 

868,352

 

 

49.9

 

 

1,107,372

 

 

73.8

 

Total borrowings

5,297,466

 

 

4,325,534

 

 

3,356,378

 

 

1,978,570

 

 

1,794,331

 

 

971,932

 

 

22.5

 

 

3,503,135

 

 

195.2

 

Total interest-bearing liabilities

31,999,470

 

 

30,910,609

 

 

26,650,028

 

 

16,869,272

 

 

16,618,841

 

 

1,088,861

 

 

3.5

 

 

15,380,629

 

 

92.5

 

Total deposits and borrowings

39,929,403

 

 

38,879,378

 

 

33,214,223

 

 

20,850,083

 

 

20,538,587

 

 

1,050,025

 

 

2.7

 

 

19,390,816

 

 

94.4

 

Accrued expenses and other liabilities

1,425,536

 

 

1,549,017

 

 

1,197,014

 

 

969,723

 

 

989,104

 

 

(123,481

)

 

(8.0

)

 

436,432

 

 

44.1

 

Total liabilities

41,354,939

 

 

40,428,395

 

 

34,411,237

 

 

21,819,806

 

 

21,527,691

 

 

926,544

 

 

2.3

 

 

19,827,248

 

 

92.1

 

Total TCF Financial Corporation shareholders' equity

5,605,159

 

 

5,667,436

 

 

4,657,613

 

 

2,634,386

 

 

2,554,729

 

 

(62,277

)

 

(1.1

)

 

3,050,430

 

 

119.4

 

Non-controlling interest in subsidiaries

25,328

 

 

23,683

 

 

25,516

 

 

29,630

 

 

24,521

 

 

1,645

 

 

6.9

 

 

807

 

 

3.3

 

Total equity

5,630,487

 

 

5,691,119

 

 

4,683,129

 

 

2,664,016

 

 

2,579,250

 

 

(60,632

)

 

(1.1

)

 

3,051,237

 

 

118.3

 

Total liabilities and equity

$

46,985,426

 

 

$

46,119,514

 

 

$

39,094,366

 

 

$

24,483,822

 

 

$

24,106,941

 

 

$

865,912

 

 

1.9

 

 

$

22,878,485

 

 

94.9

 

N.M. Not Meaningful

(1)

Average balances of loans and leases include nonaccrual loans and leases and are presented net of unearned income.

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

 

Consolidated Quarterly Yields and Rates(1)(2) (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

Mar. 31,

 

2020

 

2019

 

2019

 

2019

 

2019

 

2019

2019

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank and Federal Reserve Bank stocks

2.79

%

 

3.24

%

 

1.39

%

 

3.91

%

 

3.70

%

 

(45

)

bps

(91

)

bps

Investment securities held-to-maturity

1.64

 

 

2.53

 

 

1.68

 

 

2.53

 

 

1.45

 

 

(89

)

 

19

 

 

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

2.74

 

 

2.85

 

 

2.88

 

 

3.11

 

 

3.04

 

 

(11

)

 

(30

)

 

Tax-exempt(3)

2.85

 

 

2.84

 

 

2.66

 

 

2.75

 

 

2.63

 

 

1

 

 

22

 

 

Loans and leases held-for-sale

4.53

 

 

5.58

 

 

4.74

 

 

5.88

 

 

6.05

 

 

(105

)

 

(152

)

 

Loans and leases(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

5.42

 

 

5.63

 

 

6.25

 

 

6.56

 

 

6.63

 

 

(21

)

 

(121

)

 

Commercial real estate

5.01

 

 

5.38

 

 

5.45

 

 

5.05

 

 

5.17

 

 

(37

)

 

(16

)

 

Lease financing

5.09

 

 

5.11

 

 

5.11

 

 

5.13

 

 

5.13

 

 

(2

)

 

(4

)

 

Residential mortgage

4.02

 

 

4.05

 

 

4.23

 

 

4.91

 

 

5.07

 

 

(3

)

 

(105

)

 

Consumer installment

5.23

 

 

4.97

 

 

5.73

 

 

5.63

 

 

5.58

 

 

26

 

 

(35

)

 

Home equity

5.85

 

 

5.93

 

 

6.49

 

 

6.90

 

 

6.98

 

 

(8

)

 

(113

)

 

Total loans and leases(3)

5.08

 

 

5.24

 

 

5.62

 

 

5.91

 

 

5.97

 

 

(16

)

 

(89

)

 

Interest-bearing deposits with banks and other

1.72

 

 

2.07

 

 

2.44

 

 

3.64

 

 

3.87

 

 

(35

)

 

(215

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-earning assets

4.64

 

 

4.85

 

 

5.11

 

 

5.48

 

 

5.55

 

 

(21

)

 

(91

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

0.39

 

 

0.51

 

 

0.46

 

 

0.07

 

 

0.06

 

 

(12

)

 

33

 

 

Savings

0.64

 

 

0.71

 

 

0.73

 

 

0.77

 

 

0.69

 

 

(7

)

 

(5

)

 

Money market

1.25

 

 

1.38

 

 

1.48

 

 

1.29

 

 

1.21

 

 

(13

)

 

4

 

 

Certificates of deposit

1.81

 

 

1.97

 

 

2.07

 

 

2.06

 

 

1.94

 

 

(16

)

 

(13

)

 

Total interest-bearing deposits

1.02

 

 

1.15

 

 

1.21

 

 

1.09

 

 

1.03

 

 

(13

)

 

(1

)

 

Total deposits

0.78

 

 

0.88

 

 

0.94

 

 

0.86

 

 

0.81

 

 

(10

)

 

(3

)

 

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

1.56

 

 

1.73

 

 

1.11

 

 

2.63

 

 

2.67

 

 

(17

)

 

(111

)

 

Long-term borrowings

2.42

 

 

2.87

 

 

3.17

 

 

3.34

 

 

3.44

 

 

(45

)

 

(102

)

 

Total borrowings

1.98

 

 

2.19

 

 

2.01

 

 

3.23

 

 

3.31

 

 

(21

)

 

(133

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing liabilities

1.18

 

 

1.29

 

 

1.31

 

 

1.34

 

 

1.28

 

 

(11

)

 

(10

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin (FTE)

3.76

 

 

3.89

 

 

4.14

 

 

4.49

 

 

4.61

 

 

(13

)

 

(85

)

 

(1)

Annualized.

(2)

Yields are presented on a fully tax-equivalent basis.

(3)

The yield on tax-exempt loans and investment securities available-for-sale is computed on a tax-equivalent basis using a statutory federal income tax rate of 21%.

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

Composition of Loans (Unaudited)

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31, 2019

Mar. 31, 2019

(Dollars in thousands)

2020

 

2019

 

2019

 

2019

 

2019

 

$

%

$

Commercial and industrial

$

12,326,943

 

 

$

11,439,602

 

 

$

10,913,343

 

 

$

6,666,106

 

 

$

6,852,373

 

 

$

887,341

 

7.8

%

$

5,474,570

 

Commercial real estate

9,486,904

 

 

9,136,870

 

 

8,773,970

 

 

3,168,774

 

 

2,904,379

 

 

350,034

 

3.8

 

6,582,525

 

Lease financing

2,708,998

 

 

2,699,869

 

 

2,594,373

 

 

2,582,613

 

 

2,551,344

 

 

9,129

 

0.3

 

157,654

 

Total commercial loan and lease portfolio

24,522,845

 

 

23,276,341

 

 

22,281,686

 

 

12,417,493

 

 

12,308,096

 

 

1,246,504

 

5.4

 

12,214,749

 

Residential mortgage

6,435,314

 

 

6,179,805

 

 

6,057,404

 

 

2,368,411

 

 

2,376,878

 

 

255,509

 

4.1

 

4,058,436

 

Consumer installment

1,509,953

 

 

1,542,411

 

 

1,562,252

 

 

1,474,480

 

 

1,722,557

 

 

(32,458

)

(2.1

)

(212,604

)

Home equity

3,453,502

 

 

3,498,907

 

 

3,609,410

 

 

2,924,753

 

 

2,976,679

 

 

(45,405

)

(1.3

)

476,823

 

Total consumer loan portfolio

11,398,769

 

 

11,221,123

 

 

11,229,066

 

 

6,767,644

 

 

7,076,114

 

 

177,646

 

1.6

 

4,322,655

 

Total

$

35,921,614

 

 

$

34,497,464

 

 

$

33,510,752

 

 

$

19,185,137

 

 

$

19,384,210

 

 

$

1,424,150

 

4.1

 

$

16,537,404

 

Composition of Deposits (Unaudited)

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31, 2019

Mar. 31, 2019

(Dollars in thousands)

2020

 

2019

 

2019

 

2019

 

2019

 

$

%

$

Noninterest-bearing deposits

$

8,237,916

 

 

$

7,970,590

 

 

$

7,979,900

 

 

$

4,062,912

 

 

$

4,104,652

 

 

$

267,326

 

3.4

%

$

4,133,264

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

6,289,046

 

 

5,966,178

 

 

6,266,740

 

 

2,498,042

 

 

2,532,688

 

 

322,868

 

5.4

 

3,756,358

 

Savings

8,703,864

 

 

8,506,058

 

 

8,347,541

 

 

6,503,102

 

 

6,426,465

 

 

197,806

 

2.3

 

2,277,399

 

Money market

5,105,285

 

 

4,570,081

 

 

4,305,921

 

 

1,443,004

 

 

1,468,308

 

 

535,204

 

11.7

 

3,636,977

 

Certificates of deposit

7,463,192

 

 

7,455,556

 

 

8,385,972

 

 

4,605,327

 

 

4,491,998

 

 

7,636

 

0.1

 

2,971,194

 

Total interest-bearing deposits

27,561,387

 

 

26,497,873

 

 

27,306,174

 

 

15,049,475

 

 

14,919,459

 

 

1,063,514

 

4.0

 

12,641,928

 

Total deposits

$

35,799,303

 

 

$

34,468,463

 

 

$

35,286,074

 

 

$

19,112,387

 

 

$

19,024,111

 

 

$

1,330,840

 

3.9

 

$

16,775,192

 

Summary of Credit Quality Data

 

Allowance for Credit Losses (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mar. 31,

Jan. 1,

 

Dec. 31,

Sep. 30,

Jun. 30,

Mar. 31,

 

2020

2020

 

2019

2019

2019

2019

(Dollars in thousands)

Balance

% of
Portfolio

Adjusted
for
adoption
of CECL

 

Balance

% of
Portfolio

Balance

% of
Portfolio

Balance

% of
Portfolio

Balance

% of
Portfolio

Commercial and industrial

$

117,507

 

0.95

%

$

93,884

 

 

$

42,430

 

0.38

%

$

39,974

 

0.37

%

$

38,605

 

0.59

%

$

38,639

 

0.57

%

Commercial real estate

86,209

 

0.91

 

67,620

 

 

27,308

 

0.29

 

24,090

 

0.27

 

22,747

 

0.70

 

20,659

 

0.70

 

Lease financing

27,610

 

1.02

 

21,631

 

 

14,742

 

0.55

 

14,367

 

0.55

 

14,440

 

0.56

 

14,377

 

0.56

 

Residential mortgage

97,185

 

1.51

 

72,939

 

 

8,099

 

0.13

 

19,816

 

0.33

 

21,102

 

0.89

 

20,281

 

0.85

 

Consumer installment

20,178

 

1.34

 

15,967

 

 

2,678

 

0.17

 

1,859

 

0.12

 

26,731

 

1.81

 

30,477

 

1.77

 

Home equity

57,694

 

1.67

 

47,003

 

 

17,795

 

0.51

 

21,112

 

0.58

 

22,878

 

0.78

 

23,539

 

0.79

 

Total

$

406,383

 

1.13

%

$

319,044

 

 

$

113,052

 

0.33

%

$

121,218

 

0.36

%

$

146,503

 

0.76

%

$

147,972

 

0.76

%

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

Summary of Credit Quality Data (Unaudited), Continued

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Changes in Allowance for Credit Losses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Mar. 31,

(Dollars in thousands)

2020

 

2019

 

2019

 

2019

 

2019

 

2019

 

2019

Balance, beginning of period

$

113,052

 

 

$

121,218

 

 

$

146,503

 

 

$

147,972

 

 

$

157,446

 

 

$

(8,166

)

 

$

(44,394

)

Impact of CECL adoption

205,992

 

 

 

 

 

 

 

 

 

 

205,992

 

 

205,992

 

Adjusted balance, beginning of period

319,044

 

 

121,218

 

 

146,503

 

 

147,972

 

 

157,446

 

 

197,826

 

 

161,598

 

Charge-offs

(15,649

)

 

(16,891

)

 

(35,547

)

 

(21,066

)

 

(24,431

)

 

1,242

 

 

8,782

 

Recoveries

10,172

 

 

10,654

 

 

6,969

 

 

6,984

 

 

5,777

 

 

(482

)

 

4,395

 

Net (charge-offs) recoveries

(5,477

)

 

(6,237

)

 

(28,578

)

 

(14,082

)

 

(18,654

)

 

760

 

 

13,177

 

Provision for credit losses related to loans and leases(1)

92,990

 

 

14,403

 

 

27,188

 

 

13,569

 

 

10,122

 

 

78,587

 

 

82,868

 

Other(2)

(174

)

 

(16,332

)

 

(23,895

)

 

(956

)

 

(942

)

 

16,158

 

 

768

 

Balance, end of period

$

406,383

 

 

$

113,052

 

 

$

121,218

 

 

$

146,503

 

 

$

147,972

 

 

$

293,331

 

 

$

258,411

 

(1)

Provision for credit losses related to loans and leases excludes the provision related to the unfunded commitment liability of $4.0 million and other assets from the total provision for credit losses for the three months ended March 31, 2020.

(2)

Primarily includes the transfer of the allowance for credit losses to loans and leases held-for-sale.

Net Charge-offs

 

 

 

 

 

Quarter Ended

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

2020

 

2019

 

2019

 

2019

 

2019

(Dollars in thousands)

Balance

 

Rate(1)

 

Balance

 

Rate(1)

 

Balance

 

Rate(1)

 

Balance

 

Rate(1)

 

Balance

 

Rate(1)

Commercial and industrial

$

(4,022

)

 

0.14

%

 

$

(5,736

)

 

0.21

%

 

$

(17,631

)

 

0.76

%

 

$

(5,820

)

 

0.35

%

 

$

(5,259

)

 

0.32

%

Commercial real estate

563

 

 

(0.02

)

 

(7

)

 

 

 

13

 

 

 

 

9

 

 

 

 

5

 

 

 

Lease financing

(878

)

 

0.13

 

 

(1,749

)

 

0.27

 

 

(2,192

)

 

0.34

 

 

(966

)

 

0.15

 

 

(1,391

)

 

0.22

 

Residential mortgage

355

 

 

(0.02

)

 

1,552

 

 

(0.10

)

 

(189

)

 

0.02

 

 

(80

)

 

0.01

 

 

(468

)

 

0.08

 

Consumer installment

(1,249

)

 

0.33

 

 

(2,577

)

 

0.67

 

 

(8,984

)

 

1.50

 

 

(6,990

)

 

1.76

 

 

(11,561

)

 

2.50

 

Home equity

(246

)

 

0.03

 

 

2,280

 

 

(0.25

)

 

405

 

 

(0.05

)

 

(235

)

 

0.03

 

 

20

 

 

 

Total

$

(5,477

)

 

0.06

%

 

$

(6,237

)

 

0.07

%

 

$

(28,578

)

 

0.39

%

 

$

(14,082

)

 

0.29

%

 

$

(18,654

)

 

0.39

%

(1)

Annualized net charge-off rate based on average loans and leases.

Over 90-Day Delinquencies as a Percentage of Portfolio(1)

 

 

 

 

 

 

 

 

 

 

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

Mar. 31,

 

2020

 

2019

 

2019

 

2019

 

2019

 

2019

2019

Commercial and industrial

%

 

%

 

0.02

%

 

%

 

%

 

 

bps

 

bps

Commercial real estate

0.02

 

 

0.02

 

 

0.09

 

 

 

 

 

 

 

 

2

 

 

Lease financing

0.11

 

 

0.07

 

 

0.09

 

 

0.12

 

 

0.10

 

 

4

 

 

1

 

 

Residential mortgage

0.01

 

 

0.01

 

 

0.01

 

 

0.05

 

 

0.07

 

 

 

 

(6

)

 

Consumer installment

 

 

0.01

 

 

 

 

0.14

 

 

0.14

 

 

(1

)

 

(14

)

 

Home equity

0.01

 

 

 

 

 

 

 

 

 

 

1

 

 

1

 

 

Subtotal

0.02

 

 

0.01

 

 

0.04

 

 

0.03

 

 

0.04

 

 

1

 

 

(2

)

 

Portfolios acquired with deteriorated credit quality(2)

N/A

 

 

10.43

 

 

5.47

 

 

18.92

 

 

6.75

 

 

N/A

 

 

N/A

 

 

Total delinquencies

0.02

%

 

0.09

%

 

0.09

%

 

0.04

%

 

0.04

%

 

(7

)

 

(2

)

 

(1)

Excludes nonaccrual loans and leases.

(2)

Prior to the adoption of CECL as of January 1, 2020, purchased credit impaired loans were not classified as nonaccrual loans because they were recorded at their net realizable value based on the principal and interest expected to be collected on the loans.

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

Summary of Credit Quality Data (Unaudited), Continued

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming Assets

 

 

 

 

 

 

 

 

 

 

 

 

Change From

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

Mar. 31,

(Dollars in thousands)

2020

 

2019

 

2019

 

2019

 

2019

 

2019

2019

Nonaccrual loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

$

84,157

 

 

$

53,812

 

 

$

55,039

 

 

$

18,483

 

 

$

17,150

 

 

$

30,345

 

 

$

67,007

 

 

Commercial real estate

47,032

 

 

29,735

 

 

26,518

 

 

545

 

 

607

 

 

17,297

 

 

46,425

 

 

Lease financing

13,170

 

 

10,957

 

 

11,503

 

 

12,886

 

 

10,976

 

 

2,213

 

 

2,194

 

 

Residential mortgage

61,980

 

 

38,577

 

 

48,816

 

 

34,760

 

 

35,227

 

 

23,403

 

 

26,753

 

 

Consumer installment

989

 

 

714

 

 

636

 

 

8,633

 

 

9,034

 

 

275

 

 

(8,045

)

 

Home equity

43,147

 

 

35,863

 

 

39,296

 

 

32,686

 

 

30,291

 

 

7,284

 

 

12,856

 

 

Total nonaccrual loans and leases(1)

$

250,475

 

 

$

169,658

 

 

$

181,808

 

 

$

107,993

 

 

$

103,285

 

 

$

80,817

 

 

$

147,190

 

 

Other real estate owned

38,914

 

 

34,256

 

 

27,638

 

 

11,964

 

 

18,361

 

 

4,658

 

 

20,553

 

 

Total nonperforming assets

289,389

 

 

203,914

 

 

209,446

 

 

119,957

 

 

121,646

 

 

85,475

 

 

167,743

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonaccrual loans and leases as a percentage of total loans and leases(1)

0.70

%

 

0.49

%

 

0.54

%

 

0.56

%

 

0.53

%

 

21

 

bps

17

 

bps

Allowance for credit losses as a percentage of nonaccrual loans and leases(1)

162.24

 

 

66.64

 

 

66.67

 

 

135.66

 

 

143.27

 

 

9,560

 

 

1,897

 

 

Nonperforming assets as a percentage of total loans and leases and other real estate owned(1)

0.80

 

 

0.59

 

 

0.62

 

 

0.62

 

 

0.63

 

 

21

 

 

17

 

 

(1)

Prior to the adoption of CECL as of January 1, 2020, purchased credit impaired loans were not classified as nonaccrual loans because they were recorded at their net realizable value based on the principal and interest expected to be collected on the loans. At January 1, 2020, $73.4 million of previous purchased credit impaired loans were reclassified to nonaccrual loans as a result of the adoption of CECL.

Consolidated Capital Information (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change From

(Dollars in thousands, except per share data)

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

Mar. 31,

2020

 

2019

 

2019

 

2019

 

2019

 

2019

2019

Dividends declared per common share

$

0.35

 

 

$

0.35

 

 

$

0.35

 

 

$

0.30

 

 

$

0.30

 

 

0.0

 

%

16.7

 

%

Book value per common share

35.85

 

 

36.20

 

 

35.82

 

 

30.43

 

 

29.38

 

 

(1.0

)

 

22.0

 

 

Tangible book value per common share(1)

26.16

 

 

26.60

 

 

26.18

 

 

28.33

 

 

27.28

 

 

(1.7

)

 

(4.1

)

 

Common equity to assets

11.23

%

 

11.87

%

 

12.04

%

 

10.22

%

 

10.02

%

 

(64

)

bps

121

 

bps

Tangible common equity to tangible assets(1)

8.45

 

 

9.01

 

 

9.09

 

 

9.58

 

 

9.37

 

 

(56

)

 

(92

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regulatory Capital:(2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital

$

4,026,304

 

 

$

4,050,826

 

 

$

4,009,214

 

 

$

2,305,706

 

 

$

2,266,244

 

 

(0.6

)

%

77.7

 

%

Tier 1 capital

4,225,755

 

 

4,236,648

 

 

4,197,706

 

 

2,495,178

 

 

2,459,132

 

 

(0.3

)

 

71.8

 

 

Total capital

4,744,899

 

 

4,681,630

 

 

4,652,708

 

 

2,811,347

 

 

2,792,419

 

 

1.4

 

 

69.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common equity Tier 1 capital ratio

10.44

%