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TCF Reports 21st Consecutive Year of Net Income – Earns $109.4 Million

Company Release - 1/24/2012 8:00 AM ET

2011 HIGHLIGHTS

  • Diluted earnings per common share of 71 cents
  • Net income of $109.4 million
  • Net interest margin of 3.99 percent
  • Average deposits increased $404.3 million, or 3.5 percent
  • Non-performing assets declined $53.1 million, or 10.9 percent
  • Increased total equity by $398.5 million, Tier 1 common capital increased 18.4 percent to 11.74 percent of risk-weighted assets

FOURTH QUARTER HIGHLIGHTS

  • Diluted earnings per common share of 10 cents
  • Net income of $16.4 million
  • Net interest margin of 3.92 percent
  • Non-performing assets declined $4.9 million from the third quarter of 2011
  • Completed acquisition of Gateway One Lending & Finance, LLC
  • Announced quarterly cash dividend of 5 cents per common share, payable February 29, 2012

WAYZATA, Minn.--(BUSINESS WIRE)-- TCF Financial Corporation (“TCF”) (NYSE: TCB):

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

2011

      3Q

2011

      4Q

2010

      4Q11 vs 3Q11       4Q11 vs 4Q10       YTD

2011

      YTD

2010

      Percent Change
Net income $

16,443

$ 32,255       $ 33,873

(49.0

)%      

(51.5

)% $

109,394

      $ 150,947      

(27.5

)%
Diluted earnings per common share

.10

.20 .24

(50.0

)

(58.3

)

.71

1.08

(34.3

)
 

Financial Ratios(1)

Return on average assets

.37

% .71 % .75 %

.61

% .85 %
Return on average common equity

3.55

7.12 9.09

6.32

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

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

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

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

Chairman’s Statement

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

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

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

2011

    3Q

2011

    4Q

2010

    4Q11 vs

3Q11

    4Q11 vs 4Q10     YTD

2011

    YTD

2010

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

  N.M.

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

  N.M.

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

Net Interest Income

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

Non-interest Income

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

Loans and Leases

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

4Q
2011

 

3Q
2011

 

4Q
2010

 

4Q11 vs
3Q11

 

4Q11 vs
4Q10

 

YTD
2011

 

YTD
2010

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

Credit Quality

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

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

6,271,575

  $ -   $

6,271,575

$

79,765

$

433,078

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

234,501

3,222,377

1,148

99,448

127,519

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

 

Total loans and leases

$

12,969,322

    $

262,992

    $

13,232,314

    $

87,328

        $

532,302

    $

298,311

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

91.6

% 1.9 %

93.5

% .6 % 3.8 %

2.1

% 100.0 %
                                 
60+ Days
Performing Loans and Leases Delinquent and Accruing Non-accrual Total Loans
September 30, 2011: Non-classified   Classified(1)   Total   Accruing(2)       TDRs   Loans and Leases   and Leases
Consumer real estate and other $ 6,405,059 $ - $ 6,405,059 $ 71,179 $ 378,773 $ 148,898 $ 7,003,909
Commercial 2,969,048 304,613 3,273,661 1,266 87,610 133,260 3,495,797
Leasing and equipment finance 2,953,215 28,574 2,981,789 4,709 860 24,437 3,011,795
Inventory finance   819,727       7,102       826,829       308           -       1,077       828,214  
Total loans and leases $ 13,147,049     $ 340,289     $ 13,487,338     $ 77,462         $ 467,243     $ 307,672     $ 14,339,715  
Percent of total loans and leases 91.7 % 2.4 % 94.1 % .5 % 3.3 % 2.1 % 100.0 %
                                     
60+ Days
Performing Loans and Leases Delinquent and Accruing Non-accrual Total Loans
December 31, 2010: Non-classified   Classified(1)   Total   Accruing(2)       TDRs   Loans and Leases   and Leases
Consumer real estate and other $ 6,613,610 $ - $ 6,613,610 $ 76,711 $ 337,401 $ 167,547 $ 7,195,269
Commercial 3,091,911 354,185 3,446,096 9,021 48,838 142,248 3,646,203
Leasing and equipment finance 3,073,347 35,695 3,109,042 11,029 - 34,407 3,154,478
Inventory finance   785,245       5,710       790,955       344           -       1,055       792,354  
Total loans and leases $ 13,564,113     $ 395,590     $ 13,959,703     $ 97,105         $ 386,239     $ 345,257     $ 14,788,304  
Percent of total loans and leases 91.7 % 2.7 % 94.4 % .7 % 2.6 % 2.3 % 100.0 %
 
(1) Excludes classified loans and leases that are 60+ days delinquent and accruing or accruing TDRs.
(2) Excludes accruing TDRs that are 60+ days delinquent.
 

At December 31, 2011:

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

Allowance for Loan and Lease Losses

                                                             
Credit Quality Summary                                                       Table 6    
($ in thousands)                        
Percent Change
4Q3Q4Q4Q11 vs4Q11 vsYTDYTDPercent

Allowance for Loan and Lease Losses

2011       2011       2010       3Q11       4Q10         2011       2010       Change    
Balance at beginning of period $254,325$255,472$253,120(0.4)%0.5%$265,819$244,4718.7
Charge-offs (62,973)(57,761)(69,913)9.0(9.9)(230,295)(237,063)(2.9)
Recoveries 5,051   4,359   4,966   15.91.719,313   21,974   (12.1)
Net charge-offs (57,922)(53,402)(64,947)8.5(10.8)(210,982)(215,089)(1.9)
Provision for credit losses

59,249

52,31577,646

13.3

(23.7

)

200,843

236,437

(15.1

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

255,672

  $254,325   $265,819  

0.5

 

(3.8

)$

255,672

  $265,819  

(3.8

)
 
 
 

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

 
Consumer real estate and other:
First mortgage lien 1.94%2.29%1.88%(35)bps6bps1.95%1.55%40bps
Junior lien 2.632.992.37(36)262.692.3336
Total consumer real estate 2.152.512.04(36)112.181.8038
Total consumer real estate and other 2.232.592.10(36)132.231.8637
Commercial 1.79.572.04122(25)1.151.31(16)
Leasing and equipment finance .46.36.9910(53).411.00(59)
Inventory finance .03.13.28(10)(25).10.17(7)
Total 1.631.481.7515(12)1.451.47(2)
 
Allowance as a percentage of period end loans and leases

1.81

%1.77%1.80%

1.81

%1.80%
Ratio of allowance to net charge-offs (1)1.1X1.2X1.0X1.2X1.2X
 
N.M. = Not meaningful.
(1) Annualized.                                                            
 

At December 31, 2011:

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

For the quarter ended December 31, 2011:

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

Deposits

Average Deposits   Table 7
          Percent Change      
4Q3Q4Q4Q11 vs   4Q11 vsYTDYTDPercent
($ in thousands) 2011   2011   2010   3Q11   4Q10   2011   2010   Change
 
Checking $ 4,449,640 $ 4,475,567 $ 4,358,771 (.6 )% 2.1 % $ 4,499,211 $ 4,408,853 2.0 %
Savings 5,878,392 5,812,187 5,412,094 1.1 8.6 5,692,324 5,429,416 4.8
Money market   662,024       650,598       643,801   1.8 2.8   658,693       656,691   .3
Subtotal 10,990,056 10,938,352 10,414,666 .5 5.5 10,850,228 10,494,960 3.4
Certificates   1,112,735       1,114,934       1,040,348   (.2 ) 7.0   1,103,231       1,054,179   4.7
Total deposits $ 12,102,791     $ 12,053,286     $ 11,455,014   .4 5.7 $ 11,953,459     $ 11,549,139   3.5
 
Total new checking accounts 94,321 119,616 71,225 (21.1 )% 32.4 % 431,677 418,670 3.1 %
Average interest rate on deposits (1) .32 % .39 % .46 % .38 % .53 %
 
(1) Annualized.                                  
 
  • Total average deposits increased $647.8 million, or 5.7 percent, from the fourth quarter of 2010 primarily due to increases in savings account balances and checking account production as a result of various targeted marketing campaigns. Average savings balances increased $466.3 million, or 8.6 percent, from the fourth quarter of 2010. Total new checking accounts increased 32.4 percent from the fourth quarter of 2010. Total average deposits increased $49.5 million, or .4 percent from the third quarter of 2011, primarily due to increases in average savings account balances, partially offset by seasonal decreases in checking account balances.
  • The average interest cost of deposits in the fourth quarter of 2011 was .32 percent, down 14 basis points from the fourth quarter of 2010 and down 7 basis points from the third quarter of 2011. The decrease from both periods was primarily due to pricing strategies on certain deposit products. The weighted average interest rate on deposits was .29 percent at December 31, 2011.

Non-interest Expense

   
Non-interest ExpenseTable 8
          Percent Change      
4Q3Q4Q4Q11 vs   4Q11 vsYTDYTDPercent
($ in thousands) 2011   2011   2010   3Q11   4Q10   2011   2010   Change
Compensation and
employee benefits $ 82,595 $ 87,758 $ 82,843 (5.9 )% (.3 )% $ 348,792 $ 346,072 .8 %
Occupancy and equipment 32,366 31,129 30,968 4.0 4.5 126,437 126,551 (.1 )
FDIC insurance 6,647 7,363 7,398 (9.7 ) (10.2 ) 28,747 23,584 21.9
Deposit account premiums 6,482 7,045 1,688 (8.0 ) N.M. 22,891 17,304 32.3
Advertising and marketing 2,250 1,145 3,154 96.5 (28.7 ) 10,034 13,062 (23.2 )
Other   39,148       34,708     37,309 12.8 4.9   145,489     146,253 (.5 )
Core operating expenses 169,488 169,148 163,360 .2 3.8 682,390 672,826 1.4
Foreclosed real estate and
repossessed assets, net 11,323 12,430 12,781 (8.9 ) (11.4 ) 49,238 40,385 21.9
Operating lease depreciation 6,811 7,409 8,289 (8.1 ) (17.8 ) 30,007 37,106 (19.1 )
Other credit costs, net   (89 )     (139 )   1,542 36.0 N.M.   2,816     6,018 (53.2 )
Total non-interest expense $ 187,533     $ 188,848     $185,972 (.7 ) .8 $ 764,451   $ 756,335 1.1

N.M. = Not meaningful.

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

 

   

 

       

 

Capital and Borrowing Capacity

               

Capital Information

           

Table 9

At period end

($ in thousands, except per-share data)

4Q 2011

4Q 2010

 
Total equity $

1,878,627

$ 1,480,163
Total equity to total assets

9.90

% 8.02 %
Book value per common share $

11.65

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

8.42

% 7.28 %
 
 
Risk-based capital
Tier 1 $

1,706,926

12.67

% $ 1,459,703 10.47 %
Total

1,994,875

14.80

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

647,342

4.80

399,020 2.86
 
Tier 1 Leverage Capital $

1,706,926

9.15

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

1,581,432

11.74

% $ 1,336,203 9.59 %
 
 

(1) Excludes the impact of goodwill, other intangibles and accumulated other comprehensive income (loss) (see “Reconciliation of GAAP to Non-GAAP Measures” table).

(2) Excludes the effect of qualifying trust preferred securities and qualifying non-controlling interest in subsidiaries (see “Reconciliation of GAAP to Non-GAAP Measures” table).

  • Total risk-based capital at December 31, 2011 of $2 billion, or 14.80 percent of risk-weighted assets, was $647.3 million in excess of the stated “10 percent well-capitalized” requirement.
  • The tier 1 leverage ratio and tier 1 common risk-based capital ratio decreased from 9.42 percent and 12.11 percent, respectively, at September 30, 2011 to 9.15 percent and 11.74 percent, respectively, at December 31, 2011 due mainly to the addition of goodwill and intangible assets acquired in the purchase of Gateway One.
  • On January 16, 2012, the Board of Directors of TCF declared a regular quarterly cash dividend of five cents per common share payable on February 29, 2012 to stockholders of record at the close of business on January 27, 2012.
  • At December 31, 2011, TCF had $1.9 billion in unused, secured borrowing capacity at the FHLB of Des Moines and $518 million in unused, secured borrowing capacity at the Federal Reserve Discount Window.

Website Information

A live webcast of TCF’s conference call to discuss fourth quarter earnings will be hosted at TCF’s website, http://ir.tcfbank.com, on January 24, 2012 at 10:00 a.m. CT. Additionally, the webcast will be available for replay at TCF’s website after the conference call. The website also includes free access to company news releases, TCF’s annual report, quarterly reports, investor presentations and SEC filings.

-----------------------------------------------------------------------------------------------------------------------------------------------------

TCF is a Wayzata, Minnesota-based national bank holding company with $19 billion in total assets. TCF has 434 branches in Minnesota, Illinois, Michigan, Colorado, Wisconsin, Indiana, Arizona and South Dakota, providing retail and commercial banking services. TCF also conducts commercial leasing and equipment finance business in all 50 states, commercial inventory finance business in the U.S. and Canada, and indirect auto finance business in over 30 states. For more information about TCF, please visit www.tcfbank.com.

------------------------------------------------------------------------------------------------------------------------------------------------------

Forward-Looking Information

Any statements contained in this earnings release regarding the outlook for the Company’s businesses and their respective markets, such as projections of future performance, guidance, statements of the Company’s plans and objectives, forecasts of market trends and other matters, are forward-looking statements based on the Company’s assumptions and beliefs. Such statements may be identified by such words or phrases as “will likely result,” “are expected to,” “will continue,” “outlook,” “will benefit,” “is anticipated,” “estimate,” “project,” “management believes” or similar expressions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those discussed in such statements and no assurance can be given that the results in any forward-looking statement will be achieved. For these statements, TCF claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Any forward-looking statement speaks only as of the date on which it is made, and we disclaim any obligation to subsequently revise any forward-looking statement to reflect events or circumstances after such date or to reflect the occurrence of anticipated or unanticipated events.

Certain factors could cause the Company’s future results to differ materially from those expressed or implied in any forward-looking statements contained in this release.These factors include the factors discussed in Part I, Item 1A of the Company’s Annual Report on Form 10-K under the heading “Risk Factors,” the factors discussed below and any other cautionary statements, written or oral, which may be made or referred to in connection with any such forward-looking statements. Since it is not possible to foresee all such factors, these factors should not be considered as complete or exhaustive.

Adverse Economic or Business Conditions, Credit and Other RisksDeterioration in general economic and banking industry conditions, including defaults, anticipated defaults or rating agency downgrades of sovereign debt (including debt of the U.S.), or continued high rates of or increases in unemployment in TCF’s primary banking markets; adverse economic, business and competitive developments such as shrinking interest margins, deposit outflows, deposit account attrition or an inability to increase the number of deposit accounts; adverse changes in credit quality and other risks posed by TCF’s loan, lease, investment and securities available for sale portfolios, including declines in commercial or residential real estate values or changes in the allowance for loan and lease losses dictated by new market conditions or regulatory requirements; interest rate risks resulting from fluctuations in prevailing interest rates or other factors that result in a mismatch between yields earned on TCF’s interest-earning assets and the rates paid on its deposits and borrowings; foreign currency exchange risks; counterparty risk, including the risk of defaults by our counterparties or diminished availability of counterparties who satisfy our credit quality requirements; decreases in demand for the types of equipment that TCF leases or finances; limitations on TCF’s ability to attract and retain manufacturers and dealers to expand the inventory finance business.

Legislative and Regulatory RequirementsNew consumer protection and supervisory requirements and regulations, including those resulting from action by the CFPB and changes in the scope of Federal preemption of state laws that could be applied to national banks; the imposition of requirements with an adverse impact relating to TCF’s lending, loan collection and other business activities as a result of theDodd-Frank Act, or other legislative or regulatory developments such as mortgage foreclosure moratorium laws or imposition of underwriting or other limitations that impact the ability to use certain variable-rate products; reduction of interchange revenue from debit card transactions resulting from the Durbin Amendment to the Dodd-Frank Act; impact of legislative, regulatory or other changes affecting customer account charges and fee income; changes to bankruptcy laws which would result in the loss of all or part of TCF’s security interest due to collateral value declines; deficiencies in TCF’s compliance under the Bank Secrecy Act in past or future periods, which may result in regulatory enforcement action including monetary penalties; increased health care costs resulting from Federal health care reform legislation; adverse regulatory examinations and resulting enforcement actions or other adverse consequences such as increased capital requirements or higher deposit insurance assessments; heightened regulatory practices, requirements or expectations, including, but not limited to, requirements related to the Bank Secrecy Act and anti-money laundering compliance activity.

Earnings/Capital Risks and Constraints, Liquidity RisksLimitations on TCF’s ability to pay dividends or to increase dividends in the future because of financial performance deterioration, regulatory restrictions or limitations; increased deposit insurance premiums, special assessments or other costs related to adverse conditions in the banking industry, the economic impact on banks of the Dodd-Frank Act and other regulatory reform legislation; the impact of financial regulatory reform, including the phase out of trust preferred securities in tier 1 capital called for by the Dodd-Frank Act, or additional capital, leverage, liquidity and risk management requirements or changes in the composition of qualifying regulatory capital (including those resulting from U.S. implementation of Basel III requirements); adverse changes in securities markets directly or indirectly affecting TCF’s ability to sell assets or to fund its operations; diminished unsecured borrowing capacity resulting from TCF credit rating downgrades and unfavorable conditions in the credit markets that restrict or limit various funding sources; costs associated with new regulatory requirements or interpretive guidance relating to liquidity; uncertainties relating to customer opt-in preferences with respect to NSF fees on point of sale and ATM transactions which may have an adverse impact on TCF’s fee revenue; uncertainties relating to future retail deposit account changes, including limitations on TCF’s ability to predict customer behavior and the impact on TCF’s fee revenues.

Competitive Conditions; Supermarket Branching Risk; Growth RisksReduced demand for financial services and loan and lease products; adverse developments affecting TCF’s supermarket banking relationships or any of the supermarket chains in which TCF maintains supermarket branches; customers completing financial transactions without using a bank; the effect of any negative publicity; slower than anticipated growth in existing or acquired businesses; inability to successfully execute on TCF’s growth strategy through acquisitions or cross-selling opportunities; failure to expand or diversify our balance sheet through programs or new opportunities; failure to successfully attract and retain new customers.

Technological and Operational MattersTechnological or operational difficulties, loss or theft of information, counterparty failures and the possibility that deposit account losses (fraudulent checks, etc.) may increase; failure to keep pace with technological change.

Litigation RisksResults of litigation, including class action litigation concerning TCF’s lending or deposit activities including account servicing processes or fees or charges, or employment practices, and possible increases in indemnification obligations for certain litigation against Visa U.S.A. and potential reductions in card revenues resulting from such litigation or other litigation against Visa.

Accounting, Audit, Tax and Insurance MattersChanges in accounting standards or interpretations of existing standards; federal or state monetary, fiscal or tax policies, including adoption of state legislation that would increase state taxes; ineffective internal controls; adverse state or Federal tax assessments or findings in tax audits; lack of or inadequate insurance coverage for claims against TCF; potential for claims and legal action related to TCF’s fiduciary responsibilities.

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
                     
 
Three Months Ended
December 31,Change
  2011   2010   $%
Interest income:
Loans and leases$205,415$220,772$(15,357)(7.0)%
Securities available for sale22,55918,0724,48724.8
Investments and other   2,333   1,900   43322.8
Total interest income   230,307   240,744   (10,437)(4.3)
Interest expense:
Deposits9,79113,370(3,579)(26.8)
Borrowings   47,082   53,088   (6,006)(11.3)
Total interest expense   56,873   66,458   (9,585)(14.4)
Net interest income173,434174,286(852)(.5)
Provision for credit losses  

59,249

  77,646  

(18,397)

(23.7)

Net interest income after provision for
credit losses  

114,185

  96,640  

17,545

18.2

Non-interest income:
Fees and service charges51,00261,480(10,478)(17.0)
Card revenue13,64327,625(13,982)(50.6)
ATM revenue   6,608   6,985   (377)(5.4)
Subtotal71,25396,090(24,837)(25.8)
Leasing and equipment finance18,49223,402(4,910)(21.0)
Other   1,570   817   75392.2
Fees and other revenue91,315120,309(28,994)(24.1)
Gains on securities, net5,84221,185(15,343)(72.4)
Gains on sales of auto loans   1,133   -   1,133N.M.
Total non-interest income   98,290   141,494   (43,204)(30.5)
Non-interest expense:
Compensation and employee benefits82,59582,843(248)(.3)
Occupancy and equipment32,36630,9681,3984.5
FDIC insurance6,6477,398(751)(10.2)
Deposit account premiums6,4821,6884,794N.M.
Advertising and marketing2,2503,154(904)(28.7)
Other   39,148   37,309   1,8394.9
Subtotal169,488163,3606,1283.8
Foreclosed real estate and repossessed assets, net11,32312,781(1,458)(11.4)
Operating lease depreciation6,8118,289(1,478)(17.8)
Other credit costs, net   (89)   1,542   (1,631)(105.8)
Total non-interest expense   187,533   185,972   1,561.8
Income before income tax expense

24,942

52,162

(27,220)

(52.2)

Income tax expense  

7,424

  17,391  

(9,967)

(57.3)

Income after income tax expense

17,518

34,771

(17,253)

(49.6)

Income attributable to non-controlling interest   1,075   898   17719.7
Net income available to common stockholders$

16,443

$33,873$

(17,430)

(51.5)

 
Net income per common share:
Basic$

.10

$.24$

(.14)

(58.3)

Diluted

.10

.24

(.14)

(58.3)

 
Dividends declared per common share$.05$.05$--
 
Average common and common equivalent
shares outstanding (in thousands):
Basic157,829140,97016,85912.0
Diluted158,152141,21616,93612.0
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
                   
 
Year Ended
December 31,Change
  2011   2010   $%
Interest income:
Loans and leases$844,796$883,923$(39,127)(4.4)%
Securities available for sale85,18880,4454,7435.9
Investments and other   7,967   5,509   2,45844.6
Total interest income   937,951   969,877   (31,926)(3.3)
Interest expense:
Deposits45,10861,229(16,121)(26.3)
Borrowings   193,155   209,446   (16,291)(7.8)
Total interest expense   238,263   270,675   (32,412)(12.0)
Net interest income699,688699,202486.1
Provision for credit losses  

200,843

  236,437  

(35,594)

(15.1)

Net interest income after provision for
credit losses  

498,845

  462,765  

36,080

7.8

Non-interest income:
Fees and service charges219,363273,181(53,818)(19.7)
Card revenue96,147111,067(14,920)(13.4)
ATM revenue   27,927   29,836   (1,909)(6.4)
Subtotal343,437414,084(70,647)(17.1)
Leasing and equipment finance89,16789,194(27)N.M.
Other   3,434   5,584   (2,150)(38.5)
Fees and other revenue436,038508,862(72,824)(14.3)
Gains on securities, net7,26329,123(21,860)(75.1)
Gains on sales of auto loans   1,133   -   1,133N.M.
Total non-interest income   444,434   537,985   (93,551)(17.4)
Non-interest expense:
Compensation and employee benefits348,792346,0722,720.8
Occupancy and equipment126,437126,551(114)(.1)
FDIC insurance28,74723,5845,16321.9
Deposit account premiums22,89117,3045,58732.3
Advertising and marketing10,03413,062(3,028)(23.2)
Other   145,489   146,253   (764)(.5)
Subtotal682,390672,8269,5641.4
Foreclosed real estate and repossessed assets, net49,23840,3858,85321.9
Operating lease depreciation30,00737,106(7,099)(19.1)
Other credit costs, net   2,816   6,018   (3,202)(53.2)
Total non-interest expense   764,451   756,335   8,1161.1
Income before income tax expense

178,828

244,415

(65,587)

(26.8)

Income tax expense  

64,441

  90,171  

(25,730)

(28.5)

Income after income tax expense

114,387

154,244

(39,857)

(25.8)

Income attributable to non-controlling interest   4,993   3,297   1,69651.4
Net income available to common stockholders$

109,394

$150,947$

(41,558)

(27.5)

 
Net income per common share:
Basic$

.71

$1.08$

(.37)

(34.3)

Diluted

.71

1.08

(.37)

(34.3)

 
Dividends declared per common share$.20$.20$--
 
Average common and common equivalent
shares outstanding (in thousands):
Basic154,222138,61715,60511.3
Diluted154,509138,81315,69611.3
 
N.M. Not meaningful.
 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per-share data)
(Unaudited)
                 
 
AtAtChange
December 31,December 31,
20112010$%
ASSETS
 
Cash and due from banks$ 1,389,704$ 663,901$ 725,803%109.3%
Investments157,780179,768(21,988)(12.2)
Securities available for sale2,324,0381,931,174392,86420.3
Loans and leases held for sale14,321-14,321N.M.
Loans and leases:-
Consumer real estate and other6,933,8047,195,269(261,465)(3.6)
Commercial3,449,4923,646,203(196,711)(5.4)
Leasing and equipment finance3,142,2593,154,478(12,219)(.4)
Inventory finance624,700792,354(167,654)(21.2)
Total loans and leases14,150,25514,788,304(638,049)(4.3)
Allowance for loan and lease losses

(255,672)

(265,819)

10,147

3.8

Net loans and leases

13,894,583

14,522,485

(672,902)

(4.3)
Premises and equipment, net436,281443,768(7,487)(1.7)
Goodwill225,640152,59973,04147.9
Other assets

537,041

571,330

(34,289)

(6.0)

Total assets

$ 18,979,388

$ 18,465,025

514,363

2.8
 
LIABILITIES AND EQUITY
 
Deposits:
Checking$ 4,629,749$ 4,530,064$ 99,6852.2
Savings5,855,2635,390,802464,4618.6
Money market651,377635,92215,4552.4
Subtotal11,136,38910,556,788579,6015.5
Certificates of deposit1,065,6151,028,32737,2883.6
Total deposits12,202,00411,585,115616,8895.3
Short-term borrowings6,416126,790(120,374)(94.9)
Long-term borrowings4,381,6644,858,821(477,157)(9.8)
Total borrowings4,388,0804,985,611(597,531)(12.0)
Accrued expenses and other liabilities510,677414,13696,54123.3
Total liabilities17,100,76116,984,862115,899.7
Equity:
Preferred stock, par value $.01 per share,
30,000,000 authorized; 0 shares issued----
Common stock, par value $.01 per share,
280,000,000 shares authorized; 160,366,380,
and 142,965,012 shares issued1,6041,43017412.2
Additional paid-in capital715,247459,884255,36355.5
Retained earnings, subject to certain restrictions

1,127,823

1,049,156

78,667

7.5

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

1,868,133

1,471,663

396,470

26.9

Non-controlling interest in subsidiaries10,4948,5001,99423.5
Total equity

1,878,627

1,480,163

398,464

26.9

Total liabilities and equity

$ 18,979,388

$ 18,465,025

514,363

2.8
 
N.M. Not meaningful.
 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
SUMMARY OF CREDIT QUALITY DATA
(Dollars in thousands)
(Unaudited)
                           
AtAtAtAtAtChange from
Dec. 31,Sep. 30,Jun. 30,Mar. 31,Dec. 31,Sep. 30,Dec. 31,
2011201120112011201020112010

Delinquency Data - Principal Balances(1)

60 days or more:
Consumer real estate
First mortgage lien$ 87,358$ 78,241$ 74,090$ 70,024$ 73,848$ 9,117$ 13,510
Junior lien22,27718,49917,78019,52820,7633,7781,514
Total consumer real estate109,63596,74091,87089,55294,61112,89515,024
Consumer other41581717839(17)2
Total consumer real estate and other109,67696,79892,04189,63094,65012,87815,026
Commercial1,1483,0796,2381,8649,021(1,931)(7,873)
Leasing and equipment finance3,5122,8402,4475,2745,054672(1,542)
Inventory finance160306145240318(146)(158)
Subtotal114,496103,023100,87197,008109,04311,4735,453
Acquired portfolios3,1401,8702,9934,3996,0001,270(2,860)
Total delinquencies$ 117,636$ 104,893$ 103,864$ 101,407$ 115,043$ 12,743$ 2,593
 

Delinquency Data - % of Portfolio(1)

60 days or more:
Consumer real estate
First mortgage lien1.89%1.68%1.58%1.48%1.55%21bps34bps
Junior lien1.04.86.82.89.931811
Total consumer real estate1.631.421.341.301.352128
Consumer other.12.18.46.22.10(6)2
Total consumer real estate and other1.621.411.331.291.352127
Commercial.03.09.18.05.26(6)(23)
Leasing and equipment finance.13.11.09.20.192(6)
Inventory finance.03.04.02.03.05(1)(2)
Subtotal.85.75.73.69.79106
Acquired portfolios.84.51.70.891.0033(16)
Total delinquencies.85.75.73.70.80105
 
(1) Excludes non-accrual loans and leases.
 
AtAtAtAtAtChange from
Dec. 31,Sep. 30,Jun. 30,Mar. 31,Dec. 31,Sep. 30,Dec. 31,
2011201120112011201020112010

Non-Accrual Loans and Leases

Non-accrual loans and leases:
Consumer real estate
First mortgage lien$ 129,114$ 130,671$ 129,837$ 133,865$ 140,871$ (1,557)$ (11,757)
Junior lien20,25718,22321,06921,32526,6262,034(6,369)
Total consumer real estate149,371148,894150,906155,190167,497477(18,126)
Consumer other15432435011(35)
Total consumer real estate and other149,386148,898150,938155,233167,547488(18,161)
Commercial

127,519

133,260140,407127,745142,248

(5,741)

(14,729)

Leasing and equipment finance20,58324,43729,68234,63434,407(3,854)(13,824)
Inventory finance8231,0776341,4371,055(254)(232)
Total non-accrual loans and leases

$ 298,311

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

$ (9,361)

$ (46,946)

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

125,893

80,01486,99680,59692,180

45,879

33,713

Charge-offs

(38,263)

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

(8,925)

4,829

Transfers to other assets

(31,486)

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

(9,832)

10,173

Return to accrual status(19,932)(20,272)(21,985)(24,634)(17,989)340(1,943)
Payments received(45,238)(23,843)(14,383)(12,881)(15,036)(21,395)(30,202)
Other, net(335)1,1041,4631,6691,041(1,439)(1,376)
Balance, end of period

$ 298,311

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

$ (9,361)

$ (46,946)

 
Charge-offs and allowance recorded on
non-accrual loans and leases as a percentage
of contractual balance
Consumer real estate29.9%29.3%26.6%24.5%22.0%60bps790bps
Commercial

37.2

34.337.940.543.1

290

(590)

Leasing and equipment finance17.722.120.523.624.3(440)(660)
Inventory finance5.35.711.87.117.5(40)(1,220)
Total

32.4

31.031.431.431.6

140

80

 
 

 

 
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
SUMMARY OF CREDIT QUALITY DATA, CONTINUED
(Dollars in thousands)
(Unaudited)
                                     
 
 
AtAtAtAtAtChange from
Dec. 31,Sep. 30,Jun. 30,Mar. 31,Dec. 31,Sep. 30,Dec. 31,
2011201120112011201020112010
Other Real Estate Owned
Other real estate owned (1):
Consumer real estate$87,792$88,206$94,311$97,976$90,115$(414)$(2,323)
Commercial real estate   47,106   42,207   42,188   44,178   50,950   4,899   (3,844)
Total other real estate owned$134,898$130,413$136,499$142,154$141,065$4,485$(6,167)
 
Other real estate owned - rollforward
Balance, beginning of period$130,413$136,499$142,154$141,065$136,144$(6,086)$(5,731)
Transferred in

33,864

24,93927,64935,48044,513

8,925

(10,649)

Sales

(25,909)

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

186

8,757

Writedowns

(5,719)

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

618

501

Other, net  

2,249

  1,407   2,196   3,203   1,294  

842

 

955

Balance, end of period$134,898$130,413$136,499$142,154$141,065$4,485$(6,167)
 
Charge-offs and writedowns recorded on other real
estate owned as a percentage of contractual
loan balance prior to non-performing status
Consumer36.0%35.1%33.1%32.2%33.0%90bps300bps
Commercial43.242.733.224.526.6501,660
Total38.737.833.130.030.890790
 
Ending number of properties owned
Consumer real estate4654564884935209(55)
Commercial real estate   33   33   26   26   28   -   5
Total   498   489   514