TCF Reports Second Quarter 2020 Results

TCF also announces quarterly cash dividends on common and preferred stock

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

Second Quarter 2020 Highlights

  • Quarterly net income of $23.8 million, or $0.14 per diluted share, down 54.2% from the first quarter of 2020
  • Adjusted diluted earnings per common share of $0.54(1), down 5.3% from the first quarter of 2020. Adjusted diluted earnings per common share excludes $61.1 million, or $0.40 per share, after-tax impact of merger-related expenses and notable items
  • Assisted customers via COVID-19-related loan and lease deferrals with $1.8 billion of balances on deferral status as of June 30, 2020 ($1.5 billion of commercial balances and $327.1 million of consumer balances)
  • Assisted business and commercial customers via $1.9 billion of total loans funded through the Paycheck Protection Program ("PPP")
  • Completed the sale of seven Arizona branches resulting in a gain on sale of $14.7 million
  • Loan and lease balances declined 1.1% from March 31, 2020, primarily due to declines in the commercial and industrial and residential mortgage portfolios, partially offset by the addition of $1.8 billion of Paycheck Protection Program ("PPP") loans
  • Deposit growth of 9.5% compared to March 31, 2020
  • Net charge-offs of $3.4 million, or 0.04% of average loans and leases (annualized)
  • Provision for credit losses of $78.7 million, down 18.8% from the first quarter of 2020
  • Efficiency ratio of 78.26%, up 869 basis points from the first quarter of 2020. Adjusted efficiency ratio of 59.80%(1), up 156 basis points from the first quarter of 2020
  • Common equity Tier 1 capital ratio of 11.09%, compared to 10.44% at March 31, 2020
  • Declared quarterly cash dividends on common stock of $0.35 per share payable on September 1, 2020

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

  • Pre-tax merger-related expenses of $81.6 million, $64.6 million net of tax, or $0.42 per diluted common share for the second quarter of 2020, compared to 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
  • Pre-tax income, net of expenses, of $4.4 million, $3.5 million net of tax, or $0.02 per diluted common share related to notable items for the second quarter of 2020, compared to pre-tax net 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, 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. For the third quarter 2019, TCF’s reported financial results 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. 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

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

Jun. 30,

(Dollars in thousands, except per share data)

2020

 

2020

 

2019

 

2019

 

2019

 

2020

2019

Financial Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to TCF

$

23,764

 

 

$

51,899

 

 

$112,399

 

$

22,148

 

 

$

90,427

 

 

(54.2

)

%

(73.7

)

%

Net interest income

378,359

 

 

401,481

 

 

408,753

 

 

371,793

 

 

254,057

 

 

(5.8

)

 

48.9

 

 

Basic earnings per common share

$

0.14

 

 

$

0.33

 

 

$

0.72

 

 

$

0.15

 

 

$

1.07

 

 

(57.6

)

 

(86.9

)

 

Diluted earnings per common share

0.14

 

 

0.32

 

 

0.72

 

 

0.15

 

 

1.07

 

 

(56.3

)

 

(86.9

)

 

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

0.21

%

 

0.46

%

 

0.99

%

 

0.26

%

 

1.54

%

 

(25

)

bps

(133

)

bps

ROACE(3)

1.56

 

 

3.64

 

 

8.00

 

 

1.75

 

 

14.27

 

 

(208

)

 

(1,271

)

 

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

2.57

 

 

5.42

 

 

11.35

 

 

2.68

 

 

15.46

 

 

(285

)

 

(1,289

)

 

Net interest margin

3.33

 

 

3.73

 

 

3.86

 

 

4.12

 

 

4.46

 

 

(40

)

 

(113

)

 

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

3.35

 

 

3.76

 

 

3.89

 

 

4.14

 

 

4.49

 

 

(41

)

 

(114

)

 

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

0.04

 

 

0.06

 

 

0.07

 

 

0.39

 

 

0.29

 

 

(2

)

 

(25

)

 

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

0.94

 

 

0.80

 

 

0.59

 

 

0.62

 

 

0.62

 

 

14

 

 

32

 

 

Efficiency ratio

78.26

 

 

69.57

 

 

73.49

 

 

91.32

 

 

65.11

 

 

869

 

 

1,315

 

 

Adjusted Financial Results (non-GAAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income attributable to TCF(2)

$

84,862

 

 

$

89,855

 

 

$161,581

 

$128,301

 

$

93,650

 

 

(5.6

)

%

(9.4

)

%

Adjusted diluted earnings per common

share(2)

$

0.54

 

 

$

0.57

 

 

$

1.04

 

 

$

0.98

 

 

$

1.11

 

 

(5.3

)

 

(51.4

)

 

Adjusted ROAA(2)(3)

0.70

%

 

0.78

%

 

1.42

%

 

1.34

%

 

1.59

%

 

(8

)

bps

(89

)

bps

Adjusted ROACE(2)(3)

6.03

 

 

6.43

 

 

11.57

 

 

11.21

 

 

14.79

 

 

(40

)

 

(876

)

 

Adjusted ROATCE(2)(3)

8.70

 

 

9.24

 

 

16.25

 

 

14.96

 

 

16.02

 

 

(54

)

 

(732

)

 

Adjusted efficiency ratio(2)

59.80

 

 

58.24

 

 

58.51

 

 

58.74

 

 

61.48

 

 

156

 

 

(168

)

 

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 June 30, 2020

 

For the Quarter Ended March 31, 2020

(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

$

(81,619

)

 

$

(64,585

)

 

$

(0.42

)

 

$

(36,728

)

 

(29,026

)

 

$

(0.19

)

Notable items:

 

 

 

 

 

 

 

 

 

 

 

Expenses related to the sale of Legacy TCF auto finance portfolio(2)

(901

)

 

(713

)

 

 

 

(3,063

)

 

(2,421

)

 

(0.02

)

Branch sales and exit costs, net(3)

14,166

 

 

11,210

 

 

0.07

 

 

 

 

 

 

 

Loan servicing rights impairment(4)

(8,858

)

 

(7,009

)

 

(0.05

)

 

(8,236

)

 

(6,509

)

 

(0.04

)

Total notable items

4,407

 

 

3,488

 

 

0.02

 

 

(11,299

)

 

(8,930

)

 

(0.06

)

Total merger-related and notable items

$

(77,212

)

 

$

(61,097

)

 

$

(0.40

)

 

$

(48,027

)

 

$

(37,956

)

 

$

(0.25

)

 

(1)

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

(2)

Second quarter of 2020 included within other noninterest expense ($0.8 million) and compensation and employee benefits ($0.1 million). 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).

(3)

Included within other noninterest income ($14.7 million net gain) and other noninterest expense ($0.6 million).

(4)

 

Included within other noninterest income.

TCF Financial Corporation ("TCF" or the "Corporation") (NASDAQ: TCF) today reported net income of $23.8 million, or diluted earnings per common share of $0.14, for the second quarter of 2020, compared with $51.9 million, or diluted earnings per common share of $0.32, for the first quarter of 2020. Adjusted net income was $84.9 million, or $0.54 per diluted common share for the second quarter of 2020, compared with $89.9 million, or $0.57 per diluted common share, for the first quarter of 2020 (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables).

"During the second quarter, we continued to demonstrate the resiliency and strength of TCF during this period of economic uncertainty, low interest rates, and global pandemic,” said Craig R. Dahl, president and chief executive officer. “Our focus remains on ensuring the safety and well-being of our team members, and the financial well-being of our customers and our communities. We continued to forge ahead with our integration activities during the quarter and we remain on track for the on-time completion of our integration program during the third quarter. We remain confident in our ability to deliver on the cost synergies we committed to for the fourth quarter of this year.

“We have been active in supporting small businesses in our communities by funding $1.9 billion of loans through the PPP. We have also extended loan and lease deferrals to provide financial relief to our commercial and consumer customers, while continuing to support the broader financial needs of our customers.

“We believe TCF is well positioned with strong capital levels and substantial liquidity as we face a low interest rate environment and uncertain economic outlook. Our lending portfolios also benefit from diversification across both geographies and asset classes.

“Our team members are working extremely hard to ensure we support our customers in this current economic environment, while delivering on our commitment to being a premier Midwest bank with the size and scale to compete and win in our markets.”

Net Interest Income and Net Interest Margin

Net interest income was $378.4 million for the second quarter of 2020, a decrease of $23.1 million, or 5.8%, from the first quarter of 2020. Purchase accounting accretion and amortization included in net interest income was $18.2 million for the second quarter of 2020, compared to $25.3 million for the first quarter of 2020. Adjusted net interest income, excluding purchase accounting accretion and amortization, was $360.2 million for the second quarter of 2020, compared to $376.2 million for the first quarter of 2020, a non-GAAP financial measure. Additionally, second quarter 2020 net interest income recorded included $9.6 million of interest income from PPP less funding costs. Adjusted net interest income, excluding purchase accounting accretion and amortization and the impact from PPP loans, was $350.6 million for the second quarter of 2020, a non-GAAP financial measure. Net interest margin was 3.33% for the second quarter of 2020, compared to 3.73% in the first quarter of 2020, while net interest margin on a fully tax-equivalent basis (FTE) was 3.35%, down 41 basis points from the first quarter of 2020. The decrease in net interest margin from the first quarter of 2020 was additionally driven by the full quarter impact of the Federal Reserve's rate cuts, a decrease in the benefit provided by purchase accounting accretion and amortization and higher average cash balances, partially offset by lower cost of funds. Adjusted net interest margin FTE, excluding purchase accounting accretion and amortization and the impact of PPP loans, was 3.20% in the second quarter of 2020, compared to 3.53% in the first quarter of 2020, a non-GAAP financial measure. See the "Reconciliation of GAAP to Non-GAAP Financial Measures" tables for reconciliations of our noted non-GAAP measures.

Noninterest Income

Noninterest income was $133.1 million for the second quarter of 2020, a decrease of $3.9 million, or 2.9%, from the first quarter of 2020. Noninterest income for the second quarter of 2020 included notable items of a $14.7 million gain on the sale of our Arizona branches and an $8.9 million loan servicing rights impairment, both included in other noninterest income. Noninterest income for the first quarter of 2020 included an $8.2 million loan servicing rights impairment, a notable item, included in other noninterest income. Adjusted noninterest income for the second quarter of 2020 was $127.2 million, compared to $145.2 million in the first quarter of 2020 (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables). The second quarter of 2020, compared to the first quarter of 2020, also included increases of $8.4 million in net gains on sales of loans and leases and $3.6 million in leasing revenue, which were offset by decreases of $11.8 million and $1.0 million in fee and service charges on deposit accounts and card and ATM revenue, respectively, and a decrease of $0.4 million of 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 $400.2 million for the second quarter of 2020, an increase of $25.6 million, or 6.8%, from the first quarter of 2020. The second quarter of 2020 included $81.6 million of merger-related expenses, compared to $36.7 million for the first quarter of 2020. Noninterest expense for the second quarter of 2020 also included $0.9 million of expense related to the sale of the Legacy TCF auto finance portfolio ($0.8 million in other noninterest expense and $0.1 million in compensation and employee benefits) and $0.6 million of expense related to branch exit costs, included in other noninterest expense considered notable items. Noninterest expense for the first quarter of 2020 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. Excluding merger-related expenses and notable items, adjusted noninterest expense was $317.2 million for the second quarter of 2020, compared to $334.8 million for the first quarter of 2020 (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables). The second quarter of 2020 also included $0.2 million of federal historic tax credit amortization, included in other noninterest expense, compared to $1.5 million in the first quarter of 2020.

Income Tax Expense

Income tax expense for the second quarter of 2020 was $6.2 million, an effective tax rate of 19.1%, compared to $13.1 million, an effective tax rate of 19.6% for the first quarter of 2020. The $6.9 million, or 52.5%, decrease in income tax expense was primarily driven by lower pre-tax income.

Credit Quality

Provision for credit losses Provision for credit losses was $78.7 million for the second quarter of 2020, a decrease of $18.2 million, from the first quarter of 2020. The provision for credit losses is comprised of $58.1 million for the provision for credit losses related to loans and leases and $20.6 million for the provision for credit losses related to unfunded lending commitments in the second quarter of 2020, compared to $93.0 million for the provision for credit losses related to loans and leases and $4.0 million for the provision for credit losses related to unfunded lending commitments in the first quarter of 2020. The decrease in provision for credit losses related to loans and leases from the first quarter of 2020 was primarily due to a decrease in loan originations, excluding PPP loans which are individually guaranteed by the Small Business Administration and therefore the accounting under CECL does not require reserves to be recorded on such loans, partially offset by the economic downturn related to COVID-19. The increase in provision for credit losses related to unfunded lending commitments from the first quarter of 2020 was primarily due to the economic downturn related to COVID-19 and a decrease in line utilization.

Net charge-off rate The annualized net charge-offs as a percentage of average loans and leases was 0.04% for the second quarter of 2020, down 2 basis points from the first quarter of 2020.

Allowance for Credit Losses Allowance for credit losses includes both the allowance for loan and lease losses, which is presented separately on the Consolidated Statements of Financial Condition, and the reserve for unfunded lending commitments, which is included in other liabilities on the Consolidated Statements of Financial Condition. Allowance for credit losses was $503.9 million, or 1.42% of total loans and leases, at June 30, 2020, up from $428.6 million, or 1.19%, at March 31, 2020. The allowance for credit losses as a percentage of total loans and leases, excluding PPP loans was 1.49% (see "Reconciliation of GAAP to Non-GAAP Financial Measures" tables). The PPP loans are individually guaranteed by the Small Business Administration and therefore the accounting under CECL does not require reserves to be recorded on such loans. The increase from March 31, 2020 was primarily due to further deterioration in economic outlook as a result of the impact of COVID-19.

Nonaccrual loans and leases Nonaccrual loans and leases were $291.5 million at June 30, 2020 and represented 0.82% of total loans and leases, compared to $250.5 million, or 0.70% of total loans and leases, at March 31, 2020. The $41.0 million increase in nonaccrual loans and leases from March 31, 2020 included increases within each of our loan and lease portfolios.

Balance Sheet

Loans and leases Loans and leases were $35.5 billion at June 30, 2020, a decrease of $0.4 billion, or 1.1%, compared to $35.9 billion at March 31, 2020. The decrease was primarily due to a decline in the commercial and industrial portfolio, primarily inventory finance related to seasonality, strong dealer activity and the lack of backfill from manufacturers as a result of the economic shutdown, in addition to a decline in the residential mortgage portfolio, partially offset by the addition of PPP loans. As of June 30, 2020 we had $1.8 billion of PPP loans outstanding, all included in our commercial and industrial loans.

Investment securities The investment securities portfolio was $7.3 billion at June 30, 2020, an increase of $188.6 million, or 2.6%, compared to $7.2 billion at March 31, 2020. The increase from March 31, 2020 was primarily due to purchases of residential agency mortgage-backed securities.

Deposits Deposits were $39.2 billion at June 30, 2020, an increase of $3.4 billion, or 9.5%, compared to $35.8 billion at March 31, 2020. The increase from March 31, 2020 was primarily due to increases in noninterest-bearing deposits of $2.2 billion, savings account balances of $606.5 million, money market deposits of $478.9 million and checking deposit account balances of $404.0 million, reflecting lower consumer spending.

Capital The common equity Tier 1 capital ratio was 11.09% at June 30, 2020, compared to 10.44% at March 31, 2020. Our capital ratios 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 resume 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 September 1, 2020 to shareholders of record at the close of business on August 14, 2020. In addition, the board of directors declared a quarterly cash dividend of $0.35625 per depositary share payable on September 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 August 14, 2020.

Conference Call Details TCF will host a conference call to discuss second quarter 2020 results on Tuesday, July 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 2542421. To listen to the replay via phone, please dial (877) 344-7529 and enter access code 10145803. The replay begins approximately one hour after the call is completed on Tuesday, July 28, 2020 and will be available through Tuesday, August 4, 2020.

TCF Financial Corporation (NASDAQ: TCF) is a Detroit, Michigan-based financial holding company with $50 billion in total assets at June 30, 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 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, tangible common equity to tangible assets and the allowance for credit losses as percentage of total loans and leases, excluding PPP loans 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 and the impact of PPP loans. 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)

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31, 2020

Jun 30, 2019

2020

 

2020

 

2019

 

2019

 

2019

 

$

%

$

%

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

$

535,507

 

 

$

713,413

 

 

$

491,787

 

 

$

586,060

 

 

$

294,566

 

 

$

(177,906

)

(24.9

)%

$

240,941

 

81.8

%

Interest-bearing deposits with other banks

2,545,170

 

 

565,458

 

 

736,584

 

 

736,954

 

 

260,705

 

 

1,979,712

 

N.M.

2,284,465

 

N.M.

Total cash and cash equivalents

3,080,677

 

 

1,278,871

 

 

1,228,371

 

 

1,323,014

 

 

555,271

 

 

1,801,806

 

140.9

 

2,525,406

 

N.M.

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

386,483

 

 

484,461

 

 

442,440

 

 

290,238

 

 

105,659

 

 

(97,978

)

(20.2

)

280,824

 

N.M.

Investment securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale, at fair value

7,219,373

 

 

7,025,224

 

 

6,720,001

 

 

5,579,835

 

 

3,109,803

 

 

194,149

 

2.8

 

4,109,570

 

132.1

 

Held-to-maturity, at amortized cost

130,101

 

 

135,619

 

 

139,445

 

 

144,000

 

 

144,919

 

 

(5,518

)

(4.1

)

(14,818

)

(10.2

)

Total investment securities

7,349,474

 

 

7,160,843

 

 

6,859,446

 

 

5,723,835

 

 

3,254,722

 

 

188,631

 

2.6

 

4,094,752

 

125.8

 

Loans and leases held-for-sale

532,799

 

 

287,177

 

 

199,786

 

 

1,436,069

 

 

74,410

 

 

245,622

 

85.5

 

458,389

 

N.M.

Loans and leases

35,535,824

 

 

35,921,614

 

 

34,497,464

 

 

33,510,752

 

 

19,185,137

 

 

(385,790

)

(1.1

)

16,350,687

 

85.2

 

Allowance for loan and lease losses

(461,114

)

 

(406,383

)

 

(113,052

)

 

(121,218

)

 

(146,503

)

 

(54,731

)

(13.5

)

(314,611

)

N.M.

Loans and leases, net

35,074,710

 

 

35,515,231

 

 

34,384,412

 

 

33,389,534

 

 

19,038,634

 

 

(440,521

)

(1.2

)

16,036,076

 

84.2

 

Premises and equipment, net

472,240

 

 

516,454

 

 

533,138

 

 

554,194

 

 

432,751

 

 

(44,214

)

(8.6

)

39,489

 

9.1

 

Goodwill

1,313,046

 

 

1,313,046

 

 

1,299,878

 

 

1,265,111

 

 

154,757

 

 

0

 

0.0

 

1,158,289

 

N.M.

Other intangible assets, net

157,373

 

 

162,887

 

 

168,368

 

 

215,910

 

 

18,885

 

 

(5,514

)

(3.4

)

138,488

 

N.M.

Loan servicing rights

38,816

 

 

47,283

 

 

56,313

 

 

55,301

 

 

19

 

 

(8,467

)

(17.9

)

38,797

 

N.M.

Other assets

1,656,842

 

 

1,828,130

 

 

1,479,401

 

 

1,439,305

 

 

991,722

 

 

(171,288

)

(9.4

)

665,120

 

67.1

 

Total assets

$

50,062,460

 

 

$

48,594,383

 

 

$

46,651,553

 

 

$

45,692,511

 

 

$

24,626,830

 

 

$

1,468,077

 

3.0

 

$

25,435,630

 

103.3

%

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing

$

10,480,245

 

 

$

8,237,916

 

 

$

7,970,590

 

 

$

7,979,900

 

 

$

4,062,912

 

 

$

2,242,329

 

27.2

%

$

6,417,333

 

157.9

%

Interest-bearing

28,730,627

 

 

27,561,387

 

 

26,497,873

 

 

27,306,174

 

 

15,049,475

 

 

1,169,240

 

4.2

 

13,681,152

 

90.9

 

Total deposits

39,210,872

 

 

35,799,303

 

 

34,468,463

 

 

35,286,074

 

 

19,112,387

 

 

3,411,569

 

9.5

 

20,098,485

 

105.2

 

Short-term borrowings

2,772,998

 

 

3,482,535

 

 

2,669,145

 

 

2,607,300

 

 

350,764

 

 

(709,537

)

(20.4

)

2,422,234

 

N.M.

Long-term borrowings

936,908

 

 

2,600,594

 

 

2,354,448

 

 

860,482

 

 

1,617,531

 

 

(1,663,686

)

(64.0

)

(680,623

)

(42.1

)

Other liabilities

1,483,127

 

 

1,056,118

 

 

1,432,256

 

 

1,245,238

 

 

835,630

 

 

427,009

 

40.4

 

647,497

 

77.5

 

Total liabilities

44,403,905

 

 

42,938,550

 

 

40,924,312

 

 

39,999,094

 

 

21,916,312

 

 

1,465,355

 

3.4

 

22,487,593

 

102.6

 

Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock

169,302

 

 

169,302

 

 

169,302

 

 

169,302

 

 

169,302

 

 

 

 

 

 

Common stock

152,233

 

 

152,186

 

 

152,966

 

 

153,571

 

 

87,944

 

 

47

 

0.0

 

64,289

 

73.1

 

Additional paid-in capital

3,441,925

 

 

3,433,234

 

 

3,462,080

 

 

3,478,159

 

 

781,788

 

 

8,691

 

0.3

 

2,660,137

 

N.M.

Retained earnings

1,700,480

 

 

1,732,932

 

 

1,896,427

 

 

1,840,214

 

 

1,874,308

 

 

(32,452

)

(1.9

)

(173,828

)

(9.3

)

Accumulated other comprehensive income

198,408

 

 

166,170

 

 

54,277

 

 

56,228

 

 

37,334

 

 

32,238

 

19.4

 

161,074

 

N.M.

Treasury stock at cost and other

(27,093

)

 

(28,140

)

 

(28,037

)

 

(27,370

)

 

(265,017

)

 

1,047

 

3.7

 

237,924

 

89.8

 

Total TCF Financial Corporation shareholders' equity

5,635,255

 

 

5,625,684

 

 

5,707,015

 

 

5,670,104

 

 

2,685,659

 

 

9,571

 

0.2

 

2,949,596

 

109.8

 

Non-controlling interest

23,300

 

 

30,149

 

 

20,226

 

 

23,313

 

 

24,858

 

 

(6,849

)

(22.7

)

(1,558

)

(6.3

)

Total equity

5,658,555

 

 

5,655,833

 

 

5,727,241

 

 

5,693,417

 

 

2,710,517

 

 

2,722

 

0.0

 

2,948,038

 

108.8

 

Total liabilities and equity

$

50,062,460

 

 

$

48,594,383

 

 

$

46,651,553

 

 

$

45,692,511

 

 

$

24,626,829

 

 

$

1,468,077

 

3.0

 

$

25,435,631

 

103.3

%

N.M. Not Meaningful

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

 

 

 

 

Consolidated Statements of Income (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

(Dollars in thousands)

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31, 2020

 

Jun. 30, 2019

2020

 

2020

 

2019

 

2019

 

2019

 

$

 

%

 

$

 

%

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans and leases

$

392,826

 

 

$

443,096

 

 

$

446,738

 

 

$

417,370

 

 

$

283,282

 

 

$

(50,270

)

 

(11.3

)%

 

$

109,544

 

 

38.7

%

Interest on investment securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

32,505

 

 

40,920

 

 

36,282

 

 

31,038

 

 

22,041

 

 

(8,415

)

 

(20.6

)

 

10,464

 

 

47.5

 

Tax-exempt

4,155

 

 

4,349

 

 

4,374

 

 

3,385

 

 

1,208

 

 

(194

)

 

(4.5

)

 

2,947

 

 

N.M.

Interest on loans held-for-sale

3,322

 

 

1,561

 

 

15,767

 

 

1,408

 

 

599

 

 

1,761

 

 

112.8

 

 

2,723

 

 

N.M.

Interest on other earning assets

5,562

 

 

5,466

 

 

6,617

 

 

6,607

 

 

3,651

 

 

96

 

 

1.8

 

 

1,911

 

 

52.3

 

Total interest income

438,370

 

 

495,392

 

 

509,778

 

 

459,808

 

 

310,781

 

 

(57,022

)

 

(11.5

)

 

127,589

 

 

41.1

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

46,785

 

 

67,419

 

 

77,003

 

 

70,900

 

 

40,646

 

 

(20,634

)

 

(30.6

)

 

6,139

 

 

15.1

 

Interest on borrowings

13,226

 

 

26,492

 

 

24,022

 

 

17,115

 

 

16,078

 

 

(13,266

)

 

(50.1

)

 

(2,852

)

 

(17.7

)

Total interest expense

60,011

 

 

93,911

 

 

101,025

 

 

88,015

 

 

56,724

 

 

(33,900

)

 

(36.1

)

 

3,287

 

 

5.8

 

Net interest income

378,359

 

 

401,481

 

 

408,753

 

 

371,793

 

 

254,057

 

 

(23,122

)

 

(5.8

)

 

124,302

 

 

48.9

 

Provision for credit losses

78,726

 

 

96,943

 

 

14,403

 

 

27,188

 

 

13,569

 

 

(18,217

)

 

(18.8

)

 

65,157

 

 

N.M.

Net interest income after provision for credit losses

299,633

 

 

304,538

 

 

394,350

 

 

344,605

 

 

240,488

 

 

(4,905

)

 

(1.6

)

 

59,145

 

 

24.6

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leasing revenue

37,172

 

 

33,565

 

 

46,686

 

 

39,590

 

 

39,277

 

 

3,607

 

 

10.7

 

 

(2,105

)

 

(5.4

)

Fees and service charges on deposit accounts

22,832

 

 

34,597

 

 

39,356

 

 

34,384

 

 

27,842

 

 

(11,765

)

 

(34.0

)

 

(5,010

)

 

(18.0

)

Net gains (losses) on sales of loans and leases

29,034

 

 

20,590

 

 

12,934

 

 

(5,984

)

 

11,141

 

 

8,444

 

 

41.0

 

 

17,893

 

 

160.6

 

Card and ATM revenue

20,636

 

 

21,685

 

 

24,751

 

 

23,315

 

 

20,496

 

 

(1,049

)

 

(4.8

)

 

140

 

 

0.7

 

Wealth management revenue

6,206

 

 

6,151

 

 

6,172

 

 

4,241

 

 

 

 

55

 

 

0.9

 

 

6,206

 

 

N.M.

Servicing fee revenue

3,041

 

 

6,792

 

 

6,022

 

 

5,121

 

 

4,523

 

 

(3,751

)

 

(55.2

)

 

(1,482

)

 

(32.8

)

Net gains on investment securities

8

 

 

 

 

8

 

 

5,900

 

 

1,066

 

 

8

 

 

N.M.

 

(1,058

)

 

(99.2

)

Other

14,125

 

 

13,583

 

 

22,123

 

 

(12,309

)

 

5,373

 

 

542

 

 

4.0

 

 

8,752

 

 

162.9

 

Total noninterest income

133,054

 

 

136,963

 

 

158,052

 

 

94,258

 

 

109,718

 

 

(3,909

)

 

(2.9

)

 

23,336

 

 

21.3

 

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and employee benefits

171,799

 

 

171,528

 

 

180,969

 

 

155,745

 

 

116,266

 

 

271

 

 

0.2

 

 

55,533

 

 

47.8

 

Occupancy and equipment

54,107

 

 

57,288

 

 

56,771

 

 

49,229

 

 

41,850

 

 

(3,181

)

 

(5.6

)

 

12,257

 

 

29.3

 

Lease financing equipment depreciation

18,212

 

 

18,450

 

 

18,629

 

 

19,408

 

 

19,133

 

 

(238

)

 

(1.3

)

 

(921

)

 

(4.8

)

Net foreclosed real estate and repossessed assets

998

 

 

1,859

 

 

4,242

 

 

2,203

 

 

2,448

 

 

(861

)

 

(46.3

)

 

(1,450

)

 

(59.2

)

Merger-related expenses

81,619

 

 

36,728

 

 

47,025

 

 

111,259

 

 

4,226

 

 

44,891

 

 

122.2

 

 

77,393

 

 

N.M.

Other

73,506

 

 

88,746

 

 

108,935

 

 

87,776

 

 

52,926

 

 

(15,240

)

 

(17.2

)

 

20,580

 

 

38.9

 

Total noninterest expense

400,241

 

 

374,599

 

 

416,571

 

 

425,620

 

 

236,849

 

 

25,642

 

 

6.8

 

 

163,392

 

 

69.0

 

Income before income tax expense (benefit)

32,446

 

 

66,902

 

 

135,831

 

 

13,243

 

 

113,357

 

 

(34,456

)

 

(51.5

)

 

(80,911

)

 

(71.4

)

Income tax expense (benefit)

6,213

 

 

13,086

 

 

21,375

 

 

(11,735

)

 

19,314

 

 

(6,873

)

 

(52.5

)

 

(13,101

)

 

(67.8

)

Income after income tax expense (benefit)

26,233

 

 

53,816

 

 

114,456

 

 

24,978

 

 

94,043

 

 

(27,583

)

 

(51.3

)

 

(67,810

)

 

(72.1

)

Income attributable to non-controlling interest

2,469

 

 

1,917

 

 

2,057

 

 

2,830

 

 

3,616

 

 

552

 

 

28.8

 

 

(1,147

)

 

(31.7

)

Net income attributable to TCF Financial Corporation

23,764

 

 

51,899

 

 

112,399

 

 

22,148

 

 

90,427

 

 

(28,135

)

 

(54.2

)

 

(66,663

)

 

(73.7

)

Preferred stock dividends

2,494

 

 

2,493

 

 

2,494

 

 

2,494

 

 

2,494

 

 

1

 

 

 

 

 

 

 

Net income available to common shareholders

$

21,270

 

 

$

49,406

 

 

$

109,905

 

 

$

19,654

 

 

$

87,933

 

 

$

(28,136

)

 

(56.9

)

 

$

(66,663

)

 

(75.8

)

N.M. Not Meaningful

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Statements of Income (Unaudited)

 

 

 

 

 

 

 

 

 

Six Months Ended June 30,

 

Change

(Dollars in thousands, except per share data)

2020

 

2019

 

$

 

%

Interest income:

 

 

 

 

 

 

 

Interest and fees on loans and leases

$

835,922

 

 

$

566,520

 

 

$

269,402

 

 

47.6

%

Interest on investment securities:

 

 

 

 

 

 

 

Taxable

73,425

 

 

38,707

 

 

34,718

 

 

89.7

 

Tax-exempt

8,504

 

 

3,892

 

 

4,612

 

 

118.5

 

Interest on loans held-for-sale

4,883

 

 

1,424

 

 

3,459

 

 

N.M.

Interest on other earning assets

11,028

 

 

7,132

 

 

3,896

 

 

54.6

 

Total interest income

933,762

 

 

617,675

 

 

316,087

 

 

51.2

 

Interest expense:

 

 

 

 

 

 

 

Interest on deposits

114,204

 

 

78,254

 

 

35,950

 

 

45.9

 

Interest on borrowings

39,718

 

 

30,935

 

 

8,783

 

 

28.4

 

Total interest expense

153,922

 

 

109,189

 

 

44,733

 

 

41.0

 

Net interest income

779,840

 

 

508,486

 

 

271,354

 

 

53.4

 

Provision for credit losses

175,669

 

 

23,691

 

 

151,978

 

 

N.M.

Net interest income after provision for credit losses

604,171

 

 

484,795

 

 

119,376

 

 

24.6

 

Noninterest income:

 

 

 

 

 

 

 

Leasing revenue

70,737

 

 

77,442

 

 

(6,705

)

 

(8.7

)

Fees and service charges on deposit accounts

57,429

 

 

54,120

 

 

3,309

 

 

6.1

 

Net gains on sales of loans and leases

49,624

 

 

19,358

 

 

30,266

 

 

156.3

 

Card and ATM revenue

42,321

 

 

39,155

 

 

3,166

 

 

8.1

 

Wealth management revenue

12,357

 

 

 

 

12,357

 

 

N.M.

Servicing fee revenue

9,833

 

 

9,633

 

 

200

 

 

2.1

 

Net gains on investment securities

8

 

 

1,517

 

 

(1,509

)

 

(99.5

)

Other

27,708

 

 

11,997

 

 

15,711

 

 

131.0

 

Total noninterest income

270,017

 

 

213,222

 

 

56,795

 

 

26.6

 

Noninterest expense:

 

 

 

 

 

 

 

Compensation and employee benefits

343,327

 

 

240,208

 

 

103,119

 

 

42.9

 

Occupancy and equipment

111,395

 

 

83,560

 

 

27,835

 

 

33.3

 

Lease financing equipment depreciation

36,662

 

 

38,389

 

 

(1,727

)

 

(4.5

)

Net foreclosed real estate and repossessed assets

2,857

 

 

7,078

 

 

(4,221

)

 

(59.6

)

Merger-related expenses

118,347

 

 

13,684

 

 

104,663

 

 

N.M.

Other

162,252

 

 

107,005

 

 

55,247

 

 

51.6

 

Total noninterest expense

774,840

 

 

489,924

 

 

284,916

 

 

58.2

 

Income before income tax expense

99,348

 

 

208,093

 

 

(108,745

)

 

(52.3

)

Income tax expense

19,299

 

 

40,601

 

 

(21,302

)

 

(52.5

)

Income after income tax expense

80,049

 

 

167,492

 

 

(87,443

)

 

(52.2

)

Income attributable to non-controlling interest

4,386

 

 

6,571

 

 

(2,185

)

 

(33.3

)

Net income attributable to TCF Financial Corporation

75,663

 

 

160,921

 

 

(85,258

)

 

(53.0

)

Preferred stock dividends

4,987

 

 

4,987

 

 

 

 

 

Net income available to common shareholders

$

70,676

 

 

$

155,934

 

 

$

(85,258

)

 

(54.7

)

N.M. Not Meaningful

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Average Balance Sheets, Yields and Rates (Unaudited)

 

Quarter Ended

 

Jun. 30, 2020

 

Mar. 31, 2020

 

Jun. 30, 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

$

401,532

 

$

4,376

 

4.38%

 

$

454,675

 

$

3,152

 

2.79%

 

$

112,118

 

$

1,093

 

3.91%

Investment securities held-to-maturity

132,054

 

71

 

0.21

 

136,277

 

560

 

1.64

 

146,296

 

924

 

2.53

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

Taxable

5,730,762

 

32,434

 

2.26

 

5,892,006

 

40,360

 

2.74

 

2,711,984

 

21,117

 

3.11

Tax-exempt(3)

743,744

 

5,221

 

2.81

 

773,468

 

5,503

 

2.85

 

222,534

 

1,530

 

2.75

Loans and leases held-for-sale

356,671

 

3,322

 

3.73

 

138,058

 

1,561

 

4.53

 

40,835

 

599

 

5.88

Loans and leases(3)(4)

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

12,713,714

 

140,576

 

4.41

 

11,827,315

 

160,802

 

5.42

 

6,683,060

 

109,679

 

6.56

Commercial real estate

9,658,124

 

95,373

 

3.91

 

9,291,540

 

117,743

 

5.01

 

3,069,969

 

39,204

 

5.05

Lease financing

2,712,291

 

33,803

 

4.99

 

2,682,323

 

34,156

 

5.09

 

2,565,175

 

32,899

 

5.13

Residential mortgage

6,326,227

 

62,023

 

3.93

 

6,113,279

 

61,379

 

4.02

 

2,337,818

 

28,665

 

4.91

Home equity

3,509,107

 

45,314

 

5.19

 

3,514,278

 

51,103

 

5.85

 

2,997,050

 

51,588

 

6.90

Consumer installment

1,459,446

 

17,703

 

4.88

 

1,517,412

 

19,742

 

5.23

 

1,586,633

 

22,262

 

5.63

Total loans and leases(3)(4)

36,378,909

 

394,792

 

4.33

 

34,946,147

 

444,925

 

5.08

 

19,239,705

 

284,297

 

5.91

Interest-bearing deposits with banks and other

1,587,665

 

1,186

 

0.30

 

538,971

 

2,314

 

1.72

 

280,075

 

2,557

 

3.64

Total interest-earning assets

45,331,337

 

441,402

 

3.88

 

42,879,602

 

498,375

 

4.64

 

22,753,547

 

312,117

 

5.48

Other assets

4,384,779

 

 

 

 

4,105,824

 

 

 

 

1,730,275

 

 

 

Total assets

$

49,716,116

 

 

 

 

$

46,985,426

 

 

 

 

$

24,483,822

 

 

 

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

$

9,830,687

 

 

 

 

$

7,929,933

 

 

 

 

$

3,980,811

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

Savings

9,082,184

 

8,930

 

0.40

 

8,589,815

 

13,669

 

0.64

 

6,452,510

 

12,314

 

0.77

Certificates of deposit

7,491,502

 

26,744

 

1.44

 

7,329,632

 

33,065

 

1.81

 

4,527,822

 

23,304

 

2.06

Checking

6,649,288

 

2,329

 

0.14%

 

5,990,309

 

5,830

 

0.39%

 

2,479,814

 

440

 

0.07%

Money market

5,380,547

 

8,782

 

0.66

 

4,792,248

 

14,855

 

1.25

 

1,430,556

 

4,588

 

1.29

Total interest-bearing deposits

28,603,521

 

46,785

 

0.66

 

26,702,004

 

67,419

 

1.02

 

14,890,702

 

40,646

 

1.09

Total deposits

38,434,208

 

46,785

 

0.49

 

34,631,937

 

67,419

 

0.78

 

18,871,513

 

40,646

 

0.86

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

3,016,490

 

4,085

 

0.54

 

2,689,262

 

10,582

 

1.56

 

321,043

 

2,131

 

2.63

Long-term borrowings

1,072,394

 

9,141

 

3.40

 

2,608,204

 

15,910

 

2.42

 

1,657,527

 

13,946

 

3.34

Total borrowings

4,088,884

 

13,226

 

1.29

 

5,297,466

 

26,492

 

1.98

 

1,978,570

 

16,077

 

3.23

Total interest-bearing liabilities

32,692,405

 

60,011

 

0.74

 

31,999,470

 

93,911

 

1.18

 

16,869,272

 

56,723

 

1.34

Total deposits and borrowings

42,523,092

 

60,011

 

0.57

 

39,929,403

 

93,911

 

0.94

 

20,850,083

 

56,723

 

1.09

Accrued expenses and other liabilities

1,534,769

 

 

 

 

1,425,536

 

 

 

 

969,723

 

 

 

Total liabilities

44,057,861

 

 

 

 

41,354,939

 

 

 

 

21,819,806

 

 

 

Total TCF Financial Corporation shareholders' equity

5,630,133

 

 

 

 

5,605,159

 

 

 

 

2,634,386

 

 

 

Non-controlling interest in subsidiaries

28,122

 

 

 

 

25,328

 

 

 

 

29,630

 

 

 

Total equity

5,658,255

 

 

 

 

5,630,487

 

 

 

 

2,664,016

 

 

 

Total liabilities and equity

$

49,716,116

 

 

 

 

$

46,985,426

 

 

 

 

$

24,483,822

 

 

 

Net interest spread (FTE)

 

 

3.31%

 

 

 

3.70%

 

 

 

4.39%

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

 

$

381,391

 

3.35%

 

 

$

404,464

 

3.76%

 

 

$

255,394

 

4.49%

Reconciliation to Reported Net Interest Income

 

 

 

 

 

 

 

 

 

Net interest income (FTE)

 

$381,391

 

 

 

$404,464

 

 

 

$255,394

 

Adjustments for taxable equivalent

interest(1)(3)

 

 

 

 

 

 

 

 

 

 

 

Loans and leases

 

(1,966

)

 

 

 

(1,829

)

 

 

 

(1,015

)

 

Tax-exempt investment securities

 

(1,066

)

 

 

 

(1,154

)

 

 

 

(322

)

 

Total FTE adjustments

 

(3,032

)

 

 

 

(2,983

)

 

 

 

(1,337

)

 

Net interest income (GAAP)

 

$378,359

 

 

 

$401,481

 

 

 

$254,057

 

Net interest margin (GAAP)

 

3.33

%

 

 

 

3.73

%

 

 

 

4.46

%

 

(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 Average Balance Sheets, Yields and Rates (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30,

 

2020

 

2019

 

Average

 

 

 

Yields &

 

Average

 

 

 

Yields &

(Dollars in thousands)

Balance

 

Interest(1)

 

Rates(1)(2)

 

Balance

 

Interest(1)

 

Rates(1)(2)

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank and Federal Reserve Bank stocks

$

428,103

 

 

$

7,528

 

 

3.54%

 

$

108,646

 

 

$

2,054

 

 

3.81%

Investment securities held-to-maturity

134,166

 

 

631

 

 

0.94

 

146,922

 

 

1,459

 

 

1.99

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

Taxable

5,811,384

 

 

72,794

 

 

2.51

 

2,418,222

 

 

37,248

 

 

3.08

Tax-exempt(3)

758,606

 

 

10,724

 

 

2.83

 

368,951

 

 

4,927

 

 

2.67

Loans and leases held-for-sale

247,364

 

 

4,883

 

 

3.95

 

47,980

 

 

1,424

 

 

5.97

Loans and leases(3)(4)

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

12,270,514

 

 

301,378

 

 

4.90

 

6,589,631

 

 

216,395

 

 

6.59

Commercial real estate

9,474,832

 

 

213,116

 

 

4.45

 

2,994,221

 

 

76,941

 

 

5.11

Lease financing

2,697,307

 

 

67,959

 

 

5.04

 

2,546,364

 

 

65,283

 

 

5.13

Residential mortgage

6,219,753

 

 

123,402

 

 

3.97

 

2,341,827

 

 

58,123

 

 

4.99

Consumer installment

1,488,429

 

 

37,445

 

 

5.06

 

1,718,987

 

 

47,762

 

 

5.60

Home equity

3,511,693

 

 

96,417

 

 

5.52

 

3,022,449

 

 

104,040

 

 

6.94

Total loans and leases(3)(4)

35,662,528

 

 

839,717

 

 

4.70

 

19,213,479

 

 

568,544

 

 

5.94

Interest-bearing deposits with banks and other

1,063,319

 

 

3,500

 

 

0.66

 

270,867

 

 

5,078

 

 

3.75

Total interest-earning assets

44,105,470

 

 

939,777

 

 

4.25

 

22,575,067

 

 

620,734

 

 

5.52

Other assets

4,245,301

 

 

 

 

 

 

1,721,355

 

 

 

 

 

Total assets

$

48,350,771

 

 

 

 

 

 

$

24,296,422

 

 

 

 

 

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

$

8,880,310

 

 

 

 

 

 

$

3,950,447

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

Checking

6,319,799

 

 

8,159

 

 

0.26

 

2,468,852

 

 

827

 

 

0.07

Savings

8,836,000

 

 

22,599

 

 

0.51

 

6,353,800

 

 

22,984

 

 

0.73

Money market

5,086,397

 

 

23,637

 

 

0.93

 

1,460,427

 

 

9,041

 

 

1.25

Certificates of deposit

7,410,567

 

 

59,809

 

 

1.62

 

4,574,710

 

 

45,402

 

 

2.00

Total interest-bearing deposits

27,652,763

 

 

114,204

 

 

0.83

 

14,857,789

 

 

78,254

 

 

1.06

Total deposits

36,533,073

 

 

114,204

 

 

0.63

 

18,808,236

 

 

78,254

 

 

0.84

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

2,852,876

 

 

14,667

 

 

1.02

 

307,347

 

 

4,088

 

 

2.65

Long-term borrowings

1,840,299

 

 

25,051

 

 

2.71

 

1,579,613

 

 

26,847

 

 

3.39

Total borrowings

4,693,175

 

 

39,718

 

 

1.68

 

1,886,960

 

 

30,935

 

 

3.27

Total interest-bearing liabilities

32,345,938

 

 

153,922

 

 

0.95

 

16,744,749

 

 

109,189

 

 

1.31

Total deposits and borrowings

41,226,248

 

 

153,922

 

 

0.75

 

20,695,196

 

 

109,189

 

 

1.06

Accrued expenses and other liabilities

1,480,152

 

 

 

 

 

 

979,359

 

 

 

 

 

Total liabilities

42,706,400

 

 

 

 

 

 

21,674,555

 

 

 

 

 

Total TCF Financial Corporation shareholders' equity

5,617,646

 

 

 

 

 

 

2,594,778

 

 

 

 

 

Non-controlling interest in subsidiaries

26,725

 

 

 

 

 

 

27,089

 

 

 

 

 

Total equity

5,644,371

 

 

 

 

 

 

2,621,867

 

 

 

 

 

Total liabilities and equity

$

48,350,771

 

 

 

 

 

 

$

24,296,422

 

 

 

 

 

Net interest spread (FTE)

 

 

 

 

3.50%

 

 

 

 

 

4.46%

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

 

 

$

785,855

 

 

3.55%

 

 

 

$

511,545

 

 

4.55%

Reconciliation to Reported Net Interest Income

 

 

 

 

 

 

 

 

 

 

Net interest income (FTE)

 

 

$

785,855

 

 

 

 

 

 

$

511,545

 

 

 

Adjustments for taxable equivalent interest(1)(3)

 

 

 

 

 

 

 

 

 

 

 

Loans

 

 

(3,795

)

 

 

 

 

 

(2,024

)

 

 

Tax-exempt investment securities

 

 

(2,220

)

 

 

 

 

 

(1,035

)

 

 

Total FTE adjustments

 

 

(6,015

)

 

 

 

 

 

(3,059

)

 

 

Net interest income (GAAP)

 

 

$

779,840

 

 

 

 

 

 

$

508,486

 

 

 

Net interest margin (GAAP)

 

 

3.52

%

 

 

 

 

 

4.52

%

 

 

(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

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31, 2020

 

Jun. 30, 2019

(Dollars in thousands)

2020

 

2020

 

2019

 

2019

 

2019

 

$

 

%

 

$

 

%

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank and Federal Reserve Bank stocks

$

401,532

 

 

$

454,675

 

 

$

388,640

 

 

$

230,767

 

 

$

112,118

 

 

$

(53,143

)

 

(11.7

)%

 

$

289,414

 

 

N.M.

Investment securities held-to-maturity

132,054

 

 

136,277

 

 

140,434

 

 

143,078

 

 

146,296

 

 

(4,223

)

 

(3.1

)

 

(14,242

)

 

(9.7

)%

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

5,730,762

 

 

5,892,006

 

 

4,960,520

 

 

4,232,878

 

 

2,711,984

 

 

(161,244

)

 

(2.7

)

 

3,018,778

 

 

111.3

 

Tax-exempt

743,744

 

 

773,468

 

 

778,994

 

 

643,576

 

 

222,534

 

 

(29,724

)

 

(3.8

)

 

521,210

 

 

N.M.

Loans and leases held-for-sale

356,671

 

 

138,058

 

 

1,121,326

 

 

118,482

 

 

40,835

 

 

218,613

 

 

158.3

 

 

315,836

 

 

N.M.

Loans and leases(1) :

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

12,713,714

 

 

11,827,315

 

 

10,955,937

 

 

9,290,978

 

 

6,683,060

 

 

886,399

 

 

7.5

 

 

6,030,654

 

 

90.2

 

Commercial real estate

9,658,124

 

 

9,291,540

 

 

9,057,834

 

 

6,964,643

 

 

3,069,969

 

 

366,584

 

 

3.9

 

 

6,588,155

 

 

N.M.

Lease financing

2,712,291

 

 

2,682,323

 

 

2,616,360

 

 

2,570,567

 

 

2,565,175

 

 

29,968

 

 

1.1

 

 

147,116

 

 

5.7

 

Residential mortgage

6,326,227

 

 

6,113,279

 

 

6,023,647

 

 

4,853,627

 

 

2,337,818

 

 

212,948

 

 

3.5

 

 

3,988,409

 

 

170.6

 

Consumer installment

1,459,446

 

 

1,517,412

 

 

1,546,952

 

 

2,389,830

 

 

1,586,633

 

 

(57,966

)

 

(3.8

)

 

(127,187

)

 

(8.0

)

Home equity

3,509,107

 

 

3,514,278

 

 

3,604,153

 

 

3,433,830

 

 

2,997,050

 

 

(5,171

)

 

(0.1

)

 

512,057

 

 

17.1

 

Total loans and

leases(1)

36,378,909

 

 

34,946,147

 

 

33,804,883

 

 

29,503,475

 

 

19,239,705

 

 

1,432,762

 

 

4.1

 

 

17,139,204

 

 

89.1

 

Interest-bearing deposits with banks and other

1,587,665

 

 

538,971

 

 

656,555

 

 

933,014

 

 

280,075

 

 

1,048,694

 

 

194.6

 

 

1,307,590

 

 

N.M.

Total interest-earning assets

45,331,337

 

 

42,879,602

 

 

41,851,352

 

 

35,805,270

 

 

22,753,547

 

 

2,451,735

 

 

5.7

 

 

22,577,790

 

 

99.2

 

Other assets

4,384,779

 

 

4,105,824

 

 

4,268,162

 

 

3,289,096

 

 

1,730,275

 

 

278,955

 

 

6.8

 

 

2,654,504

 

 

153.4

 

Total assets

$

49,716,116

 

 

$

46,985,426

 

 

$

46,119,514

 

 

$

39,094,366

 

 

$

24,483,822

 

 

$

2,730,690

 

 

5.8

 

 

$

25,232,294

 

 

103.1

 

LIABILITIES AND EQUITY:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

$

9,830,687

 

 

$

7,929,933

 

 

$

7,968,769

 

 

$

6,564,195

 

 

$

3,980,811

 

 

$

1,900,754

 

 

24.0

 

 

$

5,849,876

 

 

147.0

%

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

6,649,288

 

 

5,990,309

 

 

5,891,566

 

 

4,805,843

 

 

2,479,814

 

 

658,979

 

 

11.0

 

 

4,169,474

 

 

168.1

 

Savings

9,082,184

 

 

8,589,815

 

 

8,404,460

 

 

7,676,165

 

 

6,452,510

 

 

492,369

 

 

5.7

 

 

2,629,674

 

 

40.8

 

Money market

5,380,547

 

 

4,792,248

 

 

4,463,476

 

 

3,490,922

 

 

1,430,556

 

 

588,299

 

 

12.3

 

 

3,949,991

 

 

N.M.

Certificates of deposit

7,491,502

 

 

7,329,632

 

 

7,825,573

 

 

7,320,720

 

 

4,527,822

 

 

161,870

 

 

2.2

 

 

2,963,680

 

 

65.5

 

Total interest-bearing deposits

28,603,521

 

 

26,702,004

 

 

26,585,075

 

 

23,293,650

 

 

14,890,702

 

 

1,901,517

 

 

7.1

 

 

13,712,819

 

 

92.1

 

Total deposits

38,434,208

 

 

34,631,937

 

 

34,553,844

 

 

29,857,845

 

 

18,871,513

 

 

3,802,271

 

 

11.0

 

 

19,562,695

 

 

103.7

 

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

3,016,490

 

 

2,689,262

 

 

2,585,682

 

 

1,884,228

 

 

321,043

 

 

327,228

 

 

12.2

 

 

2,695,447

 

 

N.M.

Long-term borrowings

1,072,394

 

 

2,608,204

 

 

1,739,852

 

 

1,472,150

 

 

1,657,527

 

 

(1,535,810

)

 

(58.9

)

 

(585,133

)

 

(35.3

)

Total borrowings

4,088,884

 

 

5,297,466

 

 

4,325,534

 

 

3,356,378

 

 

1,978,570

 

 

(1,208,582

)

 

(22.8

)

 

2,110,314

 

 

106.7

 

Total interest-bearing liabilities

32,692,405

 

 

31,999,470

 

 

30,910,609

 

 

26,650,028

 

 

16,869,272

 

 

692,935

 

 

2.2

 

 

15,823,133

 

 

93.8

 

Total deposits and borrowings

42,523,092

 

 

39,929,403

 

 

38,879,378

 

 

33,214,223

 

 

20,850,083

 

 

2,593,689

 

 

6.5

 

 

21,673,009

 

 

103.9

 

Accrued expenses and other liabilities

1,534,769

 

 

1,425,536

 

 

1,549,017

 

 

1,197,014

 

 

969,723

 

 

109,233

 

 

7.7

 

 

565,046

 

 

58.3

 

Total liabilities

44,057,861

 

 

41,354,939

 

 

40,428,395

 

 

34,411,237

 

 

21,819,806

 

 

2,702,922

 

 

6.5

 

 

22,238,055

 

 

101.9

 

Total TCF Financial Corporation shareholders' equity

5,630,133

 

 

5,605,159

 

 

5,667,436

 

 

4,657,613

 

 

2,634,386

 

 

24,974

 

 

0.4

 

 

2,995,747

 

 

113.7

 

Non-controlling interest in subsidiaries

28,122

 

 

25,328

 

 

23,683

 

 

25,516

 

 

29,630

 

 

2,794

 

 

11.0

 

 

(1,508

)

 

(5.1

)

Total equity

5,658,255

 

 

5,630,487

 

 

5,691,119

 

 

4,683,129

 

 

2,664,016

 

 

27,768

 

 

0.5

 

 

2,994,239

 

 

112.4

 

Total liabilities and equity

$

49,716,116

 

 

$

46,985,426

 

 

$

46,119,514

 

 

$

39,094,366

 

 

$

24,483,822

 

 

$

2,730,690

 

 

5.8

 

 

$

25,232,294

 

 

103.1

 

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

 

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

Jun. 30,

 

2020

 

2020

 

2019

 

2019

 

2019

 

2020

2019

ASSETS:

 

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank and Federal Reserve Bank stocks

4.38

%

 

2.79

%

 

3.24

%

 

1.39

%

 

3.91

%

 

159

bps

47

bps

Investment securities held-to-maturity

0.21

 

 

1.64

 

 

2.53

 

 

1.68

 

 

2.53

 

 

(143)

 

(232)

 

Investment securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

2.26

 

 

2.74

 

 

2.85

 

 

2.88

 

 

3.11

 

 

(48)

 

(85)

 

Tax-exempt(3)

2.81

 

 

2.85

 

 

2.84

 

 

2.66

 

 

2.75

 

 

(4)

 

6

 

Loans and leases held-for-sale

3.73

 

 

4.53

 

 

5.58

 

 

4.74

 

 

5.88

 

 

(80)

 

(215)

 

Loans and leases(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

4.41

 

 

5.42

 

 

5.63

 

 

6.25

 

 

6.56

 

 

(101)

 

(215)

 

Commercial real estate

3.91

 

 

5.01

 

 

5.38

 

 

5.45

 

 

5.05

 

 

(110)

 

(114)

 

Lease financing

4.99

 

 

5.09

 

 

5.11

 

 

5.11

 

 

5.13

 

 

(10)

 

(14)

 

Residential mortgage

3.93

 

 

4.02

 

 

4.05

 

 

4.23

 

 

4.91

 

 

(9)

 

(98)

 

Consumer installment

4.88

 

 

5.23

 

 

4.97

 

 

5.73

 

 

5.63

 

 

(35)

 

(75)

 

Home equity

5.19

 

 

5.85

 

 

5.93

 

 

6.49

 

 

6.90

 

 

(66)

 

(171)

 

Total loans and leases(3)

4.33

 

 

5.08

 

 

5.24

 

 

5.62

 

 

5.91

 

 

(75)

 

(158)

 

Interest-bearing deposits with banks and other

0.30

 

 

1.72

 

 

2.07

 

 

2.44

 

 

3.64

 

 

(142)

 

(334)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-earning assets

3.88

 

 

4.64

 

 

4.85

 

 

5.11

 

 

5.48

 

 

(76)

 

(160)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Checking

0.14

 

 

0.39

 

 

0.51

 

 

0.46

 

 

0.07

 

 

(25)

 

7

 

Savings

0.40

 

 

0.64

 

 

0.71

 

 

0.73

 

 

0.77

 

 

(24)

 

(37)

 

Money market

0.66

 

 

1.25

 

 

1.38

 

 

1.48

 

 

1.29

 

 

(59)

 

(63)

 

Certificates of deposit

1.44

 

 

1.81

 

 

1.97

 

 

2.07

 

 

2.06

 

 

(37)

 

(62)

 

Total interest-bearing deposits

0.66

 

 

1.02

 

 

1.15

 

 

1.21

 

 

1.09

 

 

(36)

 

(43)

 

Total deposits

0.49

 

 

0.78

 

 

0.88

 

 

0.94

 

 

0.86

 

 

(29)

 

(37)

 

Borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

0.54

 

 

1.56

 

 

1.73

 

 

1.11

 

 

2.63

 

 

(102)

 

(209)

 

Long-term borrowings

3.40

 

 

2.42

 

 

2.87

 

 

3.17

 

 

3.34

 

 

98

 

6

 

Total borrowings

1.29

 

 

1.98

 

 

2.19

 

 

2.01

 

 

3.23

 

 

(69)

 

(194)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total interest-bearing liabilities

0.74

 

 

1.18

 

 

1.29

 

 

1.31

 

 

1.34

 

 

(44)

 

(60)

 

Total deposits and borrowings

0.57

 

 

0.94

 

 

1.03

 

 

1.05

 

 

1.09

 

 

(37)

 

(52)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin (FTE)

3.35

 

 

3.76

 

 

3.89

 

 

4.14

 

 

4.49

 

 

(41)

 

(114)

 

(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

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31, 2020

Jun 30, 2019

(Dollars in thousands)

2020

 

2020

 

2019

 

2019

 

2019

 

$

%

$

Commercial and industrial

$

12,200,721

 

 

$

12,326,943

 

 

$

11,439,602

 

 

$

10,913,343

 

 

$

6,666,106

 

 

$

(126,222

)

(1.0)%

$

5,534,615

 

Commercial real estate

9,628,344

 

 

9,486,904

 

 

9,136,870

 

 

8,773,970

 

 

3,168,774

 

 

141,440

 

1.5

6,459,570

 

Lease financing

2,707,402

 

 

2,708,998

 

 

2,699,869

 

 

2,594,373

 

 

2,582,613

 

 

(1,596

)

(0.1)

124,789

 

Total commercial loan and lease portfolio

24,536,467

 

 

24,522,845

 

 

23,276,341

 

 

22,281,686

 

 

12,417,493

 

 

13,622

 

0.1

12,118,974

 

Residential mortgage

6,123,118

 

 

6,435,314

 

 

6,179,805

 

 

6,057,404

 

 

2,368,411

 

 

(312,196

)

(4.9)

3,754,707

 

Home equity

3,445,584

 

 

3,453,502

 

 

3,498,907

 

 

3,609,410

 

 

2,924,753

 

 

(7,918

)

(0.2)

520,831

 

Consumer installment

1,430,655

 

 

1,509,953

 

 

1,542,411

 

 

1,562,252

 

 

1,474,480

 

 

(79,298

)

(5.3)

(43,825

)

Total consumer loan portfolio

10,999,357

 

 

11,398,769

 

 

11,221,123

 

 

11,229,066

 

 

6,767,644

 

 

(399,412

)

(3.5)

4,231,713

 

Total

$

35,535,824

 

 

$

35,921,614

 

 

$

34,497,464

 

 

$

33,510,752

 

 

$

19,185,137

 

 

$

(385,790

)

(1.1)

$

16,350,687

 

Composition of Deposits (Unaudited)

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31, 2020

Jun 30, 2019

(Dollars in thousands)

2020

 

2020

 

2019

 

2019

 

2019

 

$

%

$

Noninterest-bearing deposits

$

10,480,245

 

 

$

8,237,916

 

 

$

7,970,590

 

 

$

7,979,900

 

 

$

4,062,912

 

 

$

2,242,329

 

27.2%

$

6,417,333

 

Interest-bearing deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings

9,310,362

 

 

8,703,864

 

 

8,506,058

 

 

8,347,541

 

 

6,503,102

 

 

606,498

 

7.0

2,807,260

 

Certificates of deposit

7,142,996

 

 

7,463,192

 

 

7,455,556

 

 

8,385,972

 

 

4,605,327

 

 

(320,196

)

(4.3)

2,537,669

 

Checking

6,693,092

 

 

6,289,046

 

 

5,966,178

 

 

6,266,740

 

 

2,498,042

 

 

404,046

 

6.4

4,195,050

 

Money market

5,584,177

 

 

5,105,285

 

 

4,570,081

 

 

4,305,921

 

 

1,443,004

 

 

478,892

 

9.4

4,141,173

 

Total interest-bearing deposits

28,730,627

 

 

27,561,387

 

 

26,497,873

 

 

27,306,174

 

 

15,049,475

 

 

1,169,240

 

4.2

13,681,152

 

Total deposits

$

39,210,872

 

 

$

35,799,303

 

 

$

34,468,463

 

 

$

35,286,074

 

 

$

19,112,387

 

 

$

3,411,569

 

9.5

$

20,098,485

 

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

 

 

 

 

 

 

 

 

Summary of Credit Quality Data

 

Allowance for Credit Losses (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Jun. 30,

 

Mar. 31,

 

Jan. 1,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

2020

 

2020

 

2020

 

2019

 

2019

 

2019

(Dollars in thousands)

Balance

% of
Loan
and
Lease
Portfolio

Balance

% of
Loan
and
Lease
Portfolio

Adjusted
for
adoption
of CECL

 

Balance

% of
Loan
and
Lease
Portfolio

Balance

% of
Loan
and
Lease
Portfolio

Balance

% of
Loan
and
Lease
Portfolio

Allowance for loan and lease losses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

$

122,024

 

 

1.00%

 

$

117,507

 

 

0.95%

 

$

93,884

 

 

$

42,430

 

 

0.38%

 

$

39,974

 

 

0.37%

 

$

38,605

 

 

0.59%

Commercial real estate

162,364

 

 

1.69

 

86,209

 

 

0.91

 

67,620

 

 

27,308

 

 

0.29

 

24,090

 

 

0.27

 

22,747

 

 

0.70

Lease financing

19,041

 

 

0.70

 

27,610

 

 

1.02

 

21,631

 

 

14,742

 

 

0.55

 

14,367

 

 

0.55

 

14,440

 

 

0.56

Residential mortgage

79,479

 

 

1.30

 

97,185

 

 

1.51

 

72,939

 

 

8,099

 

 

0.13

 

19,816

 

 

0.33

 

21,102

 

 

0.89

Consumer installment

21,382

 

 

1.49

 

20,178

 

 

1.34

 

15,967

 

 

2,678

 

 

0.17

 

1,859

 

 

0.12

 

26,731

 

 

1.81

Home equity

56,824

 

 

1.65

 

57,694

 

 

1.67

 

47,003

 

 

17,795

 

 

0.51

 

21,112

 

 

0.58

 

22,878

 

 

0.78

Total allowance for loan and lease losses

$

461,114

 

 

1.30%

 

$

406,383

 

 

1.13%

 

$

319,044

 

 

$

113,052

 

 

0.33%

 

$

121,218

 

 

0.36%

 

$

146,503

 

 

0.76%

Reserve for unfunded lending commitments

42,788

 

 

 

 

22,188

 

 

 

 

 

 

3,528

 

 

 

 

3,461

 

 

 

 

1,936

 

 

 

Total allowance for credit losses

$

503,902

 

 

1.42%

 

$

428,571

 

 

1.19%

 

 

 

$

116,580

 

 

0.34%

 

$

124,679

 

 

0.37%

 

$

148,439

 

 

0.77%

Changes in Allowance for Credit Losses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Change From

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

 

Jun. 30,

(Dollars in thousands)

2020

 

2020

 

2019

 

2019

 

2019

 

2020

 

2019

Allowance for loan and lease losses

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

406,383

 

 

$

113,052

 

 

$

121,218

 

 

$

146,503

 

 

$

147,972

 

 

$

293,331

 

 

$

258,411

 

Impact of CECL adoption

 

 

205,992

 

 

 

 

 

 

 

 

(205,992

)

 

 

Adjusted balance, beginning of period

406,383

 

 

319,044

 

 

121,218

 

 

146,503

 

 

147,972

 

 

87,339

 

 

258,411

 

Charge-offs

(9,958

)

 

(14,729

)

 

(16,891

)

 

(35,547

)

 

(21,066

)

 

4,771

 

 

11,108

 

Recoveries

6,563

 

 

9,252

 

 

10,654

 

 

6,969

 

 

6,984

 

 

(2,689

)

 

(421

)

Net (charge-offs) recoveries

(3,395

)

 

(5,477

)

 

(6,237

)

 

(28,578

)

 

(14,082

)

 

2,082

 

 

10,687

 

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

58,126

 

 

92,990

 

 

14,403

 

 

27,188

 

 

13,569

 

 

(34,864

)

 

44,557

 

Other(2)

 

 

(174

)

 

(16,332

)

 

(23,895

)

 

(956

)

 

174

 

 

956

 

Balance, end of period

461,114

 

 

406,383

 

 

113,052

 

 

121,218

 

 

146,503

 

 

54,731

 

 

314,611

 

Reserve for unfunded lending commitments

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

22,188

 

 

3,528

 

 

3,461

 

 

1,936

 

 

1,941

 

 

18,660

 

 

20,247

 

Impact of CECL adoption

 

 

14,707

 

 

 

 

 

 

 

 

(14,707

)

 

 

Adjusted balance, beginning of period

22,188

 

 

18,235

 

 

3,461

 

 

1,936

 

 

1,941

 

 

3,953

 

 

20,247

 

Provision (benefit) for credit losses related to unfunded lending commitments(1)

20,600

 

 

3,953

 

 

67

 

 

(342

)

 

(5

)

 

16,647

 

 

20,605

 

Addition due to merger

 

 

 

 

 

 

1,867

 

 

 

 

 

 

 

Balance, end of period

42,788

 

 

22,188

 

 

3,528

 

 

3,461

 

 

1,936

 

 

20,600

 

 

40,852

 

Total allowance for credit losses

$

503,902

 

 

$

428,571

 

 

$

116,580

 

 

$

124,679

 

 

$

148,439

 

 

$

75,331

 

 

$

355,463

 

(1)

Provision for credit losses related to loans and leases and the provision for credit losses related to unfunded lending commitments are included within Provision for Credit Losses in the Consolidated Statements of Income.

(2)

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

TCF FINANCIAL CORPORATION AND SUBSIDIARIES

Summary of Credit Quality Data (Unaudited), Continued

 

Net (Charge-offs) Recoveries

 

 

 

 

 

Quarter Ended

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

2020

 

2020

 

2019

 

2019

 

2019

(Dollars in thousands)

Balance

 

Rate(1)

 

Balance

 

Rate(1)

 

Balance

 

Rate(1)

 

Balance

 

Rate(1)

 

Balance

 

Rate(1)

Commercial and industrial

$

9

 

 

%

 

$

(4,022

)

 

0.14

%

 

$

(5,736

)

 

0.21

%

 

$

(17,631

)

 

0.76

%

 

$

(5,820

)

 

0.35

%

Commercial real estate

(644

)

 

0.03

 

 

563

 

 

(0.02

)

 

(7

)

 

 

 

13

 

 

 

 

9

 

 

 

Lease financing

(1,392

)

 

0.21

 

 

(878

)

 

0.13

 

 

(1,749

)

 

0.27

 

 

(2,192

)

 

0.34

 

 

(966

)

 

0.15

 

Residential mortgage

(871

)

 

0.06

 

 

355

 

 

(0.02

)

 

1,552

 

 

(0.10

)

 

(189

)

 

0.02

 

 

(80

)

 

0.01

 

Consumer installment

(162

)

 

0.04

 

 

(1,249

)

 

0.33

 

 

(2,577

)

 

0.67

 

 

(8,984

)

 

1.50

 

 

(6,990

)

 

1.76

 

Home equity

(335

)

 

0.04

 

 

(246

)

 

0.03

 

 

2,280

 

 

(0.25

)

 

405

 

 

(0.05

)

 

(235

)

 

0.03

 

Total net (charge-offs) recoveries

$

(3,395

)

 

0.04

%

 

$

(5,477

)

 

0.06

%

 

$

(6,237

)

 

0.07

%

 

$

(28,578

)

 

0.39

%

 

$

(14,082

)

 

0.29

%

(1)

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

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

 

 

 

 

 

 

 

 

 

 

 

Change From

 

Jun. 30,

 

Mar. 31,

 

Dec. 31,

 

Sep. 30,

 

Jun. 30,

 

Mar. 31,

Jun. 30,

 

2020

 

2020

 

2019

 

2019

 

2019

 

2020

2019

Commercial and industrial

0.02

%

 

%

 

%

 

0.02

%

 

%

 

2

 

bps

2

 

bps

Commercial real estate

 

 

0.02

 

 

0.02

 

 

0.09

 

 

 

 

(2

)

 

 

 

Lease financing

0.18

 

 

0.11

 

 

0.07

 

 

0.09

 

 

0.12

 

 

7

 

 

6

 

 

Residential mortgage

0.01

 

 

0.01

 

 

0.01

 

 

0.01

 

 

0.05

 

 

 

 

(4

)

 

Consumer installment

 

 

 

 

0.01

 

 

 

 

0.14

 

 

 

 

(14

)

 

Home equity

 

 

0.01

 

 

 

 

 

 

 

 

(1

)

 

 

 

Subtotal

0.02

 

 

0.02

 

 

0.01

 

 

0.04

 

 

0.03

 

 

 

 

(1

)

 

Portfolios acquired with deteriorated credit quality(2)

N/A

 

N/A

 

10.43

 

 

5.47

 

 

18.92

 

 

N/A

 

N/A

 

Total delinquencies

0.02

%

 

0.02

%

 

0.09

%

 

0.09

%

 

0.04

%

 

 

 

(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