TCF Reports Second Quarter Earnings and EPS ($.52).WAYZATA, Minn. -- TCF See Trenton Computer Festival. Financial Corporation (NYSE NYSE See: New York Stock Exchange :TCB See trusted computing base. 1. (jargon) TCB - Trouble Came Back. 2. (security) TCB - (Orange Book) Trusted Computing Base. 3. (operating system) TCB - Task Control Block. ): SECOND QUARTER HIGHLIGHTS --Diluted earnings per share of 52 cents --Net income of $67.1 million --Return on average assets of 1.92 percent --Return on average common equity of 27.75 percent --Average Power Assets(R) increased $1.2 billion, or 14.3 percent --Average Power Liabilities(R) increased $1 billion, or 11.9 percent --Increased checking accounts by 29,720, or 7.3 percent (annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. ), to 1,658,815 --Opened six new branches during the quarter; 136 new branches since January January: see month. 2001
EARNINGS SUMMARY
($ in thousands, except per-share data)
Three Months Six Months
Ended June 30, Ended June 30,
------------------------ --------------------------
2006 2005 Change 2006 2005 Change
-------- -------- ------ --------- --------- ------
Net income $67,061 $70,641 (5.1)% $125,283 $134,106 (6.6)%
Diluted earnings
per common share .52 .53 (1.9) .96 1.00 (4.0)
Financial Ratios (1)
--------------------
Return on average
assets 1.92 % 2.22 % 1.82 % 2.13 %
Return on average
common equity 27.75 30.23 25.80 28.74
Net interest
margin 4.22 4.53 4.23 4.54
Net charge-offs as
a percentage of
average loans and
leases .12 .08 .11 .03
----------------------------------------------------------------------
(1) Annualized.
TCF Financial Corporation ("TCF") (NYSE:TCB) today reported diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of of 52 cents for the second quarter of 2006, compared with 53 cents for the same 2005 period. Net income for the second quarter of 2006 was $67.1 million, compared with $70.6 million for the same 2005 period. The 2005 second quarter included $4.9 million in pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta gains on asset sales for an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. impact of two cents per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. For the second quarter of 2006, return on average assets ("ROA ROA See: Return on assets ROA See: Right of accumulation ROA See return on assets (ROA). ") was 1.92 percent and return on average common equity ("ROE A fictitious surname used for an unknown or anonymous person or for a hypothetical person in an illustration. A lawsuit is generally named for the persons who are parties to it. ") was 27.75 percent, compared with 2.22 percent and 30.23 percent, respectively, for the second quarter of 2005. Diluted earnings per share for the first six months of 2006 was 96 cents, compared with $1.00 for the same 2005 period. The first six months of 2006 includes $4.5 million in pre-tax gains on asset sales for an after-tax impact of two cents per diluted share. The first six months of 2005 included $15.9 million in pre-tax gains on asset sales and a $3.3 million pre-tax commercial loan recovery for a combined after-tax impact of nine cents per diluted share. Chief Executive Officer's Statement "TCF's 2006 second quarter earnings performance is the result of our commitment to delivering convenient products and services to our customers, as well as our continued focus on the fundamentals that have made us successful over time," said Lynn Lynn, city (1990 pop. 81,245), Essex co., E Mass.; inc. as a town 1631, as a city 1850. Lynn is an old industrial center. The first ironworks (1643) and the first fire engine (1654) in the country were built there. A. Nagorske, Chief Executive Officer. "We achieved solid growth in the second quarter in Power Assets, highlighted by our consumer lending Consumer lending or consumer loans refers to any type of loan product that is not a mortgage; such as a car, boat, manufactured home, home equity loan, home equity line of credit, signature loan, signature line of credit, recreational vehicle, or Certificate of Deposit loans. and leasing divisions, while maintaining excellent credit quality," said Nagorske.
Total Revenue
Three Months
($ in thousands) Ended June 30, Change
------------------- -----------------
2006 2005 $ %
--------- --------- -------- --------
Net interest income $135,442 $131,285 $4,157 3.2 %
--------- --------- --------
Fees and other revenue:
Fees and service charges 71,099 66,755 4,344 6.5
Card revenue 22,984 19,717 3,267 16.6
ATM revenue 9,762 10,795 (1,033) (9.6)
Investments and insurance 2,894 2,791 103 3.7
--------- --------- --------
Total banking fees and other
revenue 106,739 100,058 6,681 6.7
Leasing and equipment finance 12,552 11,092 1,460 13.2
Other 4,331 2,051 2,280 111.2
--------- --------- --------
Total fees and other revenue 123,622 113,201 10,421 9.2
--------- --------- --------
Gains on sales of securities - 4,437 (4,437) (100.0)
--------- --------- --------
Total non-interest income 123,622 117,638 5,984 5.1
--------- --------- --------
Total revenue $259,064 $248,923 $10,141 4.1
========= ========= ========
Net interest margin (1) 4.22% 4.53%
Fees and other revenue as a % of:
Total revenue 47.72 45.48
Average assets (1) 3.54 3.56
----------------------------------------------------------------------
(1) Annualized.
Net Interest Income TCF's net interest income in the second quarter of 2006 was $135.4 million, up $4.2 million, or 3.2 percent, from the second quarter of 2005 and up $4.3 million, or 3.3 percent, from the first quarter of 2006. Net interest margin in the second quarter of 2006 was 4.22 percent, compared with 4.53 percent for the second quarter of 2005 and 4.25 percent for the first quarter of 2006. The increase in net interest income from the second quarter of 2005 was primarily due to a $1.3 billion, or 10.9 percent, increase in average interest-earning assets, partially offset by the 31 basis point reduction in net interest margin. This decrease in net interest margin was primarily due to the continued customer preference for lower-yielding fixed-rate loans Fixed-rate loan A loan whose rate is fixed for the life of the loan. due to the flat yield curve Flat Yield Curve A chart that shows that the yields of bonds with short maturities are equal to the yields of bonds with longer maturities. and higher deposit and borrowing costs. The increase in net interest income from the first quarter of 2006 was primarily due to a $414.3 million, or 3.3 percent, increase in average interest-earning assets, partially offset by the three basis point reduction in net interest margin. This decrease in net interest margin was primarily due to the continued customer preference for lower-yielding fixed-rate loans due to the flat yield curve and higher deposit and borrowing costs. Non-interest Income Total non-interest income was $123.6 million for the second quarter of 2006, up $6 million, or 5.1 percent, from the same period of 2005. Banking fees and service charges were $71.1 million for the second quarter of 2006, up $4.3 million, or 6.5 percent, from the second quarter of 2005, primarily due to the growth in checking accounts. Card revenues totaled $23 million for the second quarter of 2006, up 16.6 percent over the same period in 2005. The increase in card revenues was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to an increase in active accounts and customer transaction volumes. For the second quarter of 2006, ATM revenue was $9.8 million, compared with $10.8 million for the same 2005 period. The decline in ATM revenue was primarily attributable to continued declines in fees charged to TCF customers for use of non-TCF ATM machines (Automatic Teller Machine machine) A banking terminal that accepts deposits and dispenses cash. ATMs are activated by inserting a cash or credit card that contains the user's account number and PIN on a magnetic stripe. due to expansion of TCF's ATM network and modifications of checking products, partially offset by the increased number of TCF customers with cards. Leasing and equipment finance revenues were $12.6 million for the second quarter of 2006, up $1.5 million, or 13.2 percent, from the 2005 second quarter, primarily due to higher operating lease Operating Lease A lease contract that allows the use of an asset, but does not convey rights similar to ownership of the asset. Notes: An operating lease is not capitalized it is accounted for as a rental expense. revenues, partially offset by lower sales-type lease Sales-type lease The leasing out of a firm's own equipment, such as a printing company leasing its own presses, thereby competing with an independent leasing company. revenues. Sales-type lease revenues may fluctuate from quarter to quarter based on customer driven factors not within the control of TCF. During the 2005 second quarter, TCF sold $441.5 million of mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. and realized gains Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. of $4.4 million. No such sales or gains occurred in the second quarter of 2006. New Branch Expansion TCF opened six new branches during the second quarter of 2006 and closed three branches. TCF has now opened 136 new branches since January 2001, representing 30 percent of TCF's 455 total branches. TCF plans to open 17 new branches in the remainder of 2006, consisting of 11 traditional branches, three supermarket supermarket Large retail store operated on a self-service basis, selling groceries, produce, meat, bakery and dairy products, and sometimes nonfood goods. Supermarkets were first established in the U.S. during the 1930s as no-frills retail stores offering low prices. branches and three campus branches.
June 30, June 30, December 31,
(# of branches) 2006 2005 2000
------------ ------------ ------------
Total Branches
--------------
Minnesota 106 102 84
Illinois 202 197 167
Michigan 62 61 56
Colorado 44 35 12
Wisconsin 35 34 32
Indiana 6 6 1
------------ ------------ ------------
455 435 352
============ ============ ============
New Branches (a)
---------------
Traditional 72 54
Supermarket 61 53
Campus 3 1
------------ ------------
Total 136 108
------------ ------------
% of Total Branches 30% 25%
============ ============
----------------------------------------------------------------------
(a) New branches opened since January 1, 2001.
Additional information regarding the results of TCF's new branches opened since January 1, 2001 is summarized as follows:
At or For the Three
Months Ended
June 30,
---------------------
($ in thousands) 2006 2005 Change % Change
----------- --------- --------- ----------
Number of checking accounts 252,040 187,166 64,874 34.7 %
Average deposits:
Checking $395,670 $283,011 $112,659 39.8
Savings 302,371 194,865 107,506 55.2
Money market 31,888 18,653 13,235 71.0
----------- --------- ---------
Subtotal 729,929 496,529 233,400 47.0
Certificates of deposit 438,877 164,018 274,859 167.6
----------- --------- ---------
Total deposits $1,168,806 $660,547 $508,259 76.9
=========== ========= =========
Total fees and other revenue
(quarter ended) $18,635 $13,807 $4,828 35.0
=========== ========= =========
Power Assets(R) TCF's Power Asset lending operations continue to generate strong growth. TCF's average consumer loan balances increased $768.9 million, or 16.4 percent; average commercial real estate loan balances increased $198.4 million, or 9 percent; and leasing and equipment finance balances increased $212.3 million, or 15 percent, from the second quarter of 2005.
Average Balances for the
Three Months Ended June 30, Change
--------------------------- ------------------
($ in thousands) 2006 2005 $ %
------------- ------------- ----------- ------
Loans and leases(a):
Consumer home equity
and other:
Home equity:
First mortgage lien $3,509,589 $3,079,471 $430,118 14.0 %
Junior lien 1,901,063 1,563,102 337,961 21.6
------------- ------------- -----------
Total consumer home
equity 5,410,652 4,642,573 768,079 16.5
Other 34,854 34,012 842 2.5
------------- ------------- -----------
Total consumer home
equity and other 5,445,506 4,676,585 768,921 16.4
Commercial real estate 2,398,425 2,200,008 198,417 9.0
Commercial business 500,530 432,923 67,607 15.6
Leasing and equipment
finance 1,624,781 1,412,520 212,261 15.0
------------- ------------- -----------
Power Assets $9,969,242 $8,722,036 $1,247,206 14.3
============= ============= ===========
----------------------------------------------------------------------
(a) Excludes residential real estate loans, loans held for sale
and operating leases.
Power Liabilities(R) Average Power Liabilities totaled $9.4 billion for the second quarter of 2006, with an average interest rate of 1.97 percent, an increase of $1 billion, or 11.9 percent, from the second quarter of 2005. The growth in average Power Liabilities was primarily driven by increases in Premier Checking, Premier Savings and certificates of deposit, partially offset by declines in other lower-cost interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid checking and savings. Average custodial balances decreased $68.9 million from the second quarter of 2005 due to the sale of mortgage servicing Mortgage servicing The collection of monthly payments and penalties, record keeping, payment of insurance and taxes, and possible settlement of default , involved with a mortgage loan. rights in the first quarter of 2006. The total number of checking accounts was 1,658,815 at June June: see month. 30, 2006, up 55,642 accounts, or 6.9 percent (annualized) from December December: see month. 31, 2005.
Average Balances for the
Three Months Ended June 30,
---------------------------
($ in thousands) 2006 2005 Change % Change
------------- ------------- ----------- ---------
Non-interest bearing
deposits:
Retail $1,557,933 $1,589,015 $(31,082) (2.0)%
Small business 604,776 571,701 33,075 5.8
Commercial and
custodial 234,188 311,463 (77,275) (24.8)
------------- ------------- -----------
Total non-interest
bearing deposits 2,396,897 2,472,179 (75,282) (3.0)
Interest-bearing
deposits:
Premier checking 1,000,749 580,093 420,656 72.5
Other checking 893,800 1,075,421 (181,621) (16.9)
------------- ------------- -----------
Subtotal 1,894,549 1,655,514 239,035 14.4
Premier savings 855,979 345,567 510,412 147.7
Other savings 1,415,767 1,603,720 (187,953) (11.7)
------------- ------------- -----------
Subtotal 2,271,746 1,949,287 322,459 16.5
Money market 610,766 633,762 (22,996) (3.6)
------------- ------------- -----------
Subtotal 4,777,061 4,238,563 538,498 12.7
Certificates of
deposit 2,249,694 1,707,919 541,775 31.7
------------- ------------- -----------
Total interest-
bearing deposits 7,026,755 5,946,482 1,080,273 18.2
------------- ------------- -----------
Power Liabilities $9,423,652 $8,418,661 $1,004,991 11.9
============= ============= ===========
Securities Available for Sale and Residential Real Estate Loans Average balances of securities available for sale (consisting primarily of mortgage-backed securities) and residential real estate loans totaled $2.6 billion for the second quarter of 2006, an increase of $28.7 million from the second quarter of 2005. TCF purchased $52 million of mortgage-backed securities in the second quarter of 2006, compared with $103.7 million in the second quarter of 2005. At June 30, 2006, the unrealized pre-tax loss on TCF's securities available for sale portfolio was $85.7 million.
Average Balances for the
Three Months Ended June 30, Change
--------------------------- -----------------
($ in thousands) 2006 2005 $ %
------------- ------------- --------- -------
Securities available for
sale $1,880,671 $1,646,986 $233,685 14.2 %
Residential real estate
loans 714,432 919,379 (204,947) (22.3)
------------- ------------- ---------
Total $2,595,103 $2,566,365 $28,738 1.1
============= ============= =========
Non-interest Expense Non-interest expense totaled $162 million for the second quarter of 2006, up $11.9 million, or 7.9 percent, from $150.2 million for the second quarter of 2005, primarily due to new branch expansion totaling $5.5 million, a $2 million increase in deposit account losses and a $1.7 million increase in operating lease depreciation. Compensation and employee benefits increased $3.1 million, or 3.8 percent, from the second quarter of 2005, primarily driven by a $2.1 million increase attributable to branch expansion. Occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy and equipment expenses increased $3.2 million, or 13 percent, from the second quarter of 2005, primarily due to $1.4 million associated with branch expansion. Deposit account losses increased $2 million, or 53 percent, from the second quarter of 2005, primarily due to higher uncollectable account overdrafts and external fraud losses. Operating lease depreciation increased $1.7 million from the second quarter of 2005, primarily driven by a $42.1 million increase in average operating lease balances in TCF's leasing and equipment finance subsidiaries. Other expenses increased $1.9 million, or 5.9 percent, from the second quarter of 2005, primarily driven by a $1.4 million increase related to branch expansion.
Three Months Ended
June 30, Change
------------------- ---------------
($ in thousands) 2006 2005 $ %
--------- --------- -------- ------
Compensation and employee benefits $85,083 $81,973 $3,110 3.8%
Occupancy and equipment 27,998 24,771 3,227 13.0
Advertising and promotions 6,755 6,778 (23) (.3)
Deposit account losses 5,673 3,708 1,965 53.0
Operating lease depreciation 3,405 1,671 1,734 103.8
Other 33,132 31,279 1,853 5.9
--------- --------- --------
Total non-interest expense $162,046 $150,180 $11,866 7.9
========= ========= ========
Credit Quality At June 30, 2006, TCF's allowance for loan and lease losses totaled $59.2 million, or .54 percent of loans and leases, compared with $60.4 million, or .59 percent, at December 31, 2005. The provision for credit losses for the second quarter of 2006 was $3.1 million, up $1.7 million from the second quarter of 2005. The increase in the provision for credit losses in the second quarter of 2006, compared with the second quarter of 2005, is primarily due to the overall growth of the loan and lease portfolio and higher net charge-offs. Net loan and lease charge-offs in the second quarter of 2006 were $3.2 million, or .12 percent (annualized) of average loans and leases, compared with net charge-offs of $1.9 million, or .08 percent (annualized) for the same 2005 period. At June 30, 2006, TCF's over- over- pref. 1. Above or upon in position: overpass; overcoat. 2. Superior in rank or importance: overlord. 3. 30-day delinquency delinquency Criminal behaviour carried out by a juvenile. Young males make up the bulk of the delinquent population (about 80% in the U.S.) in all countries in which the behaviour is reported. rate was .32 percent, down from .43 percent at December 31, 2005. Non-accrual loans and leases were $25.1 million, or .23 percent of net loans and leases, at June 30, 2006, compared with $29.6 million, or .29 percent, at December 31, 2005. Total non-performing assets were $51.1 million, or .36 percent of total assets, at June 30, 2006, up from $47.4 million, or .35 percent, at December 31, 2005.
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -----------------
($ in thousands) 2006 2005 2006 2005
--------- -------- -------- --------
Allowance for loan and lease
losses:
Balance at beginning of period $59,378 $76,883 $60,396 $79,878
Net (charge-offs) recoveries:
Consumer home equity and other (1,319) (1,016) (2,758) (2,325)
Commercial real estate - 3 (69) (34)
Commercial business (170) 31 (324) 2,468
Leasing and equipment finance (1,705) (911) (2,536) (1,525)
Residential real estate (35) (11) (67) (47)
--------- -------- -------- --------
Total (3,229) (1,904) (5,754) (1,463)
Provision for credit losses 3,097 1,427 4,604 (2,009)
--------- -------- -------- --------
Balance at end of period $59,246 $76,406 $59,246 $76,406
========= ======== ======== ========
Income Taxes TCF's income tax expense was $26.9 million for the second quarter of 2006, or 28.60 percent of income before income tax expense, up from $26.7 million, or 27.41 percent, for the comparable 2005 period. The second quarter of 2006 and 2005 include reductions of income tax expense of $4.1 million and $5.2 million, respectively, related to favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. developments in uncertain tax positions including the closing of certain previous years' tax returns, clarification Clarification The removal of small amounts of fine, particulate solids from liquids. The purpose is almost invariably to improve the quality of the liquid, and the removed solids often are discarded. of existing state tax legislation and developments in income tax audits. Capital During the second quarter of 2006, TCF repurchased 500,000 shares of its common stock at an average cost of $26.41 per share. TCF has 3.8 million shares remaining in its stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: by its Board of Directors.
($ in thousands, except At June 30, At June 30,
per-share data) 2006 2005
------------------ ----------------
Stockholders' equity $977,385 $954,557
Stockholders' equity to total
assets 6.88 % 7.57 %
Book value per common share $7.44 $7.12
Total risk-based capital $1,137,792 11.12 % $998,270 10.80 %
Total risk-based capital "well-
capitalized" requirement 1,023,000 10.00 923,968 10.00
Excess risk-based capital over
"well-capitalized" requirement 114,792 1.12 74,302 .80
Website Information A live webcast of TCF's conference call to discuss second quarter earnings will be hosted at TCF's website, www.tcfexpress.com, on July July: see month. 19, 2006 at 10:00 a.m., CDT CDT abbr. Central Daylight Time CDT Central Daylight Time CDT n abbr (US) (= Central Daylight Time) → hora de verano del centro; (BRIT . Additionally, the webcast is 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 financial holding company with $14.2 billion in assets. TCF has 455 banking offices in Minnesota Minnesota, state, United States Minnesota (mĭn'ĭsō`tə), upper midwestern state of the United States. It is bordered by Lake Superior and Wisconsin (E), Iowa (S), South Dakota and North Dakota (W), and the Canadian provinces , Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). , Colorado Colorado, state, United States Colorado (kŏlərăd`ə, –răd`ō, –rä`dō), state, W central United States, one of the Rocky Mt. states. , Wisconsin Wisconsin, state, United States Wisconsin (wĭskŏn`sən, –sĭn), upper midwestern state of the United States. It is bounded by Lake Superior and the Upper Peninsula of Michigan, from which it is divided by the Menominee and Indiana Indiana, state, United States Indiana, midwestern state in the N central United States. It is bordered by Lake Michigan and the state of Michigan (N), Ohio (E), Kentucky, across the Ohio R. (S), and Illinois (W). . Other TCF affiliates provide leasing and equipment finance, and investments and insurance sales. Forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. Information This earnings release and other reports issued by the Company, including reports filed with the SEC, may contain "forward-looking" statements that deal with future results, plans or performance. In addition, TCF's management may make such statements orally to the media, or to securities analysts, investors or others. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. deal with matters that do not relate strictly to historical facts. TCF's future results may differ materially from historical performance and forward-looking statements about TCF's expected financial results or other plans and are subject to a number of risks and uncertainties. These include but are not limited to possible legislative changes and adverse economic, business and competitive developments such as shrinking interest margins; deposit outflows; an inability to increase the number of checking accounts and the possibility that deposit account losses (fraudulent The description of a willful act commenced with the Specific Intent to deceive or cheat, in order to cause some financial detriment to another and to engender personal financial gain. checks, etc.) may increase; reduced demand for financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. 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; changes in accounting standards or interpretations of existing standards; monetary, fiscal or tax policies of the federal or state governments; adverse findings in tax audits or regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. examinations; changes in credit and other risks posed pose 1 v. posed, pos·ing, pos·es v.intr. 1. To assume or hold a particular position or posture, as in sitting for a portrait. 2. To affect a particular mental attitude. by TCF's loan, lease and investment portfolios, including declines in commercial or residential real estate values; imposition The printing of pages on a single sheet of paper in a particular order so that they come out in the correct sequence when cut and folded. of vicarious liability The tort doctrine that imposes responsibility upon one person for the failure of another, with whom the person has a special relationship (such as Parent and Child, on TCF as lessor One who rents real property or Personal Property to another. A lessor of land is a landlord. Cross-references Landlord and Tenant. lessor n. the owner of real property who rents it to a lessee pursuant to a written lease. in its leasing operations; denial denial, in psychology, an ego defense mechanism that operates unconsciously to resolve emotional conflict, and to allay anxiety by refusing to perceive the more unpleasant aspects of external reality. of insurance coverage for claims made by TCF; technological, computer-related or operational difficulties or loss or theft of information; adverse changes in securities markets; and results of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , including reductions in card revenues resulting from litigation brought by various merchants or merchant organizations against Visa; or other significant uncertainties. Investors should consult TCF's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , and Forms 10-Q and 8-K for additional important information about the Company.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
Three Months Ended
June 30,
-------------------
2006 2005 $ Change % Change
--------- --------- -------- ---------
Interest income:
Loans and leases $188,988 $155,014 $33,974 21.9 %
Securities available for
sale 25,156 21,325 3,831 18.0
Education loans held for
sale 4,205 2,566 1,639 63.9
Investments 792 1,094 (302) (27.6)
--------- --------- --------
Total interest income 219,141 179,999 39,142 21.7
--------- --------- --------
Interest expense:
Deposits 46,247 20,646 25,601 124.0
Borrowings 37,452 28,068 9,384 33.4
--------- --------- --------
Total interest expense 83,699 48,714 34,985 71.8
--------- --------- --------
Net interest income 135,442 131,285 4,157 3.2
Provision for credit losses 3,097 1,427 1,670 117.0
--------- --------- --------
Net interest income after
provision for credit
losses 132,345 129,858 2,487 1.9
--------- --------- --------
Non-interest income:
Fees and service charges 71,099 66,755 4,344 6.5
Card revenue 22,984 19,717 3,267 16.6
ATM revenue 9,762 10,795 (1,033) (9.6)
Investments and insurance
revenue 2,894 2,791 103 3.7
--------- --------- --------
Subtotal 106,739 100,058 6,681 6.7
Leasing and equipment
finance 12,552 11,092 1,460 13.2
Other 4,331 2,051 2,280 111.2
--------- --------- --------
Fees and other revenue 123,622 113,201 10,421 9.2
Gains on sales of securities
available for sale - 4,437 (4,437) (100.0)
--------- --------- --------
Total non-interest
income 123,622 117,638 5,984 5.1
--------- --------- --------
Non-interest expense:
Compensation and employee
benefits 85,083 81,973 3,110 3.8
Occupancy and equipment 27,998 24,771 3,227 13.0
Advertising and promotions 6,755 6,778 (23) (.3)
Deposit account losses 5,673 3,708 1,965 53.0
Other 36,537 32,950 3,587 10.9
--------- --------- --------
Total non-interest
expense 162,046 150,180 11,866 7.9
--------- --------- --------
Income before income
tax expense 93,921 97,316 (3,395) (3.5)
Income tax expense 26,860 26,675 185 .7
--------- --------- --------
Net income $67,061 $70,641 $(3,580) (5.1)
========= ========= ========
Net income per common share:
Basic $.52 $.53 $(.01) (1.9)
========= ========= ========
Diluted $.52 $.53 $(.01) (1.9)
========= ========= ========
Dividends declared per common
share $.23 $.2125 $.0175 8.2
========= ========= ========
Average common and common
equivalent shares outstanding
(in thousands):
Basic 129,169 132,410 (3,241) (2.4)
========= ========= ========
Diluted 129,362 132,742 (3,380) (2.5)
========= ========= ========
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
Six Months Ended
June 30,
-------------------
2006 2005 $ Change % Change
--------- --------- -------- ---------
Interest income:
Loans and leases $365,971 $301,558 $64,413 21.4 %
Securities available for
sale 48,855 42,820 6,035 14.1
Education loans held for
sale 8,552 4,820 3,732 77.4
Investments 1,469 2,146 (677) (31.5)
--------- --------- --------
Total interest income 424,847 351,344 73,503 20.9
--------- --------- --------
Interest expense:
Deposits 86,094 36,584 49,510 135.3
Borrowings 72,143 54,422 17,721 32.6
--------- --------- --------
Total interest expense 158,237 91,006 67,231 73.9
--------- --------- --------
Net interest income 266,610 260,338 6,272 2.4
Provision for credit losses 4,604 (2,009) 6,613 N.M.
--------- --------- --------
Net interest income after
provision for credit
losses 262,006 262,347 (341) (.1)
--------- --------- --------
Non-interest income:
Fees and service charges 132,654 124,693 7,961 6.4
Card revenue 44,246 37,359 6,887 18.4
ATM revenue 18,861 20,527 (1,666) (8.1)
Investments and insurance
revenue 5,382 5,644 (262) (4.6)
--------- --------- --------
Subtotal 201,143 188,223 12,920 6.9
Leasing and equipment
finance 24,467 21,785 2,682 12.3
Other 15,511 10,008 5,503 55.0
--------- --------- --------
Fees and other revenue 241,121 220,016 21,105 9.6
Gains on sales of securities
available for sale - 9,676 (9,676) (100.0)
--------- --------- --------
Total non-interest
income 241,121 229,692 11,429 5.0
--------- --------- --------
Non-interest expense:
Compensation and employee
benefits 171,251 163,424 7,827 4.8
Occupancy and equipment 56,049 50,150 5,899 11.8
Advertising and promotions 12,471 13,025 (554) (4.3)
Deposit account losses 9,686 7,275 2,411 33.1
Other 72,513 64,323 8,190 12.7
--------- --------- --------
Total non-interest
expense 321,970 298,197 23,773 8.0
--------- --------- --------
Income before income
tax expense 181,157 193,842 (12,685) (6.5)
Income tax expense 55,874 59,736 (3,862) (6.5)
--------- --------- --------
Net income $125,283 $134,106 $(8,823) (6.6)
========= ========= ========
Net income per common share:
Basic $.97 $1.01 $(.04) (4.0)
========= ========= ========
Diluted $.96 $1.00 $(.04) (4.0)
========= ========= ========
Dividends declared per common
share $.46 $.425 $.035 8.2
========= ========= ========
Average common and common
equivalent shares outstanding
(in thousands):
Basic 129,722 133,196 (3,474) (2.6)
========= ========= ========
Diluted 129,902 133,563 (3,661) (2.7)
========= ========= ========
N.M. Not Meaningful.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per-share data)
At At At
June 30, December 31, June 30,
2006 2005 2005
------------ ------------ ------------
(Unaudited) (Unaudited)
ASSETS
Cash and due from banks $ 371,942 $ 374,701 $ 361,158
Investments 76,124 79,943 104,127
Securities available for sale 1,781,995 1,648,615 1,406,575
Education loans held for sale 227,703 229,820 213,227
Loans and leases:
Consumer home equity and other 5,579,647 5,187,584 4,808,003
Commercial real estate 2,411,028 2,297,500 2,202,752
Commercial business 543,314 435,233 447,958
Leasing and equipment finance 1,677,641 1,503,794 1,419,868
------------ ------------ ------------
Subtotal 10,211,630 9,424,111 8,878,581
Residential real estate 695,213 770,441 884,141
------------ ------------ ------------
Total loans and leases 10,906,843 10,194,552 9,762,722
Allowance for loan and lease
losses (59,246) (60,396) (76,406)
------------ ------------ ------------
Net loans and leases 10,847,597 10,134,156 9,686,316
Premises and equipment 384,360 365,146 339,619
Goodwill 152,599 152,599 152,599
Other assets 356,029 380,380 343,595
------------ ------------ ------------
$14,198,349 $13,365,360 $12,607,216
============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Checking $ 4,341,029 $ 4,279,853 $ 4,019,685
Savings 2,297,636 2,238,204 2,046,068
Money market 603,024 677,017 629,731
------------ ------------ ------------
Subtotal 7,241,689 7,195,074 6,695,484
Certificates of deposit 2,382,273 1,915,620 1,728,842
------------ ------------ ------------
Total deposits 9,623,962 9,110,694 8,424,326
------------ ------------ ------------
Short-term borrowings 561,374 472,126 1,045,582
Long-term borrowings 2,778,277 2,511,010 1,899,047
------------ ------------ ------------
Total borrowings 3,339,651 2,983,136 2,944,629
Accrued expenses and other
liabilities 257,351 273,058 283,704
------------ ------------ ------------
Total liabilities 13,220,964 12,366,888 11,652,659
------------ ------------ ------------
Stockholders' equity:
Common stock, par value $.01
per share, 280,000,000 shares
authorized; 184,202,447;
184,386,193 and 184,425,478
shares issued 1,842 1,844 1,844
Additional paid-in capital 468,110 497,270 496,910
Retained earnings, subject to
certain restrictions 1,601,009 1,536,611 1,462,393
Accumulated other comprehensive
(loss) income (55,515) (21,215) 1,601
Treasury stock at cost,
52,813,430; 50,609,970 and
50,301,984 shares, and other (1,038,061) (1,016,038) (1,008,191)
------------ ------------ ------------
Total stockholders' equity 977,385 998,472 954,557
------------ ------------ ------------
$14,198,349 $13,365,360 $12,607,216
============ ============ ============
% Change from
-------------------------
December 31, June 30,
2005 2005
------------ ------------
ASSETS
Cash and due from banks (.7)% 3.0 %
Investments (4.8) (26.9)
Securities available for sale 8.1 26.7
Education loans held for sale (.9) 6.8
Loans and leases:
Consumer home equity and other 7.6 16.0
Commercial real estate 4.9 9.5
Commercial business 24.8 21.3
Leasing and equipment finance 11.6 18.2
Subtotal 8.4 15.0
Residential real estate (9.8) (21.4)
Total loans and leases 7.0 11.7
Allowance for loan and lease
losses 1.9 22.5
Net loans and leases 7.0 12.0
Premises and equipment 5.3 13.2
Goodwill - -
Other assets (6.4) 3.6
6.2 12.6
LIABILITIES AND STOCKHOLDERS'
EQUITY
Deposits:
Checking 1.4 8.0
Savings 2.7 12.3
Money market (10.9) (4.2)
Subtotal .6 8.2
Certificates of deposit 24.4 37.8
Total deposits 5.6 14.2
Short-term borrowings 18.9 (46.3)
Long-term borrowings 10.6 46.3
Total borrowings 12.0 13.4
Accrued expenses and other
liabilities (5.8) (9.3)
Total liabilities 6.9 13.5
Stockholders' equity:
Common stock, par value $.01 per
share, 280,000,000 shares
authorized; 184,202,447;
184,386,193 and 184,425,478
shares issued (.1) (.1)
Additional paid-in capital (5.9) (5.8)
Retained earnings, subject to
certain restrictions 4.2 9.5
Accumulated other comprehensive N.M.
(loss) income (161.7)
Treasury stock at cost,
52,813,430; 50,609,970 and
50,301,984 shares, and other (2.2) (3.0)
Total stockholders' equity (2.1) 2.4
6.2 12.6
N.M. Not Meaningful.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CREDIT QUALITY DATA
(Dollars in thousands)
(Unaudited)
Allowance for loan and lease losses:
------------------------------------
At or For the Three Months Ended
June 30, 2006
-------------------------------------
Net Charge-offs
Allowance (1)
as a % of ----------------
Allowance Portfolio $ %
---------- ---------- -------- ------
Consumer home equity and other $17,099 .31 % $1,319 .10 %
Commercial real estate 22,127 .92 - -
Commercial business 7,123 1.31 170 .14
Leasing and equipment finance 12,352 .74 1,705 .42
Residential real estate 545 .08 35 .02
---------- --------
Total $59,246 .54 $3,229 .12
========== ========
At or For the Year Ended
December 31, 2005
-------------------------------------
Net Charge-offs
Allowance (Recoveries)
as a % of ---------------
Allowance Portfolio $ %
---------- ---------- -------- ------
Consumer home equity and other $16,643 .32 % $5,210 .11 %
Commercial real estate 21,222 .92 (8) -
Commercial business 6,602 1.52 (2,173) (.51)
Leasing and equipment finance 15,313 1.02 21,384 1.50
Residential real estate 616 .08 91 .01
---------- --------
Total $60,396 .59 $24,504 .25
========== ========
Non-performing assets:
----------------------
Change from
At At At ---------------------
June 30, December 31, June 30, December 31, June 30,
2006 2005 2005 2005 2005
-------- ------------ -------- ------------ --------
Non-accrual
loans and
leases:
Consumer home
equity and
other $9,898 $18,410 $10,324 $(8,512) $(426)
Commercial
real estate 7,319 188 - 7,131 7,319
Commercial
business 1,481 2,207 2,660 (726) (1,179)
Leasing and
equipment
finance 4,906 6,434 26,485 (1,528) (21,579)
Residential
real estate 1,536 2,409 2,230 (873) (694)
-------- ------------ -------- ------------ --------
Total non-
accrual loans
and leases 25,140 29,648 41,699 (4,508) (16,559)
Other real
estate
owned:
Residential
real estate 20,393 14,877 12,479 5,516 7,914
Commercial
real estate 5,593 2,834 4,799 2,759 794
-------- ------------ -------- ------------ --------
Total other
real estate
owned 25,986 17,711 17,278 8,275 8,708
-------- ------------ -------- ------------ --------
Total non-
performing
assets $51,126 $47,359 $58,977 $3,767 $(7,851)
======== ============ ======== ============ ========
Over 30-day delinquency data (2):
---------------------------------
At June 30, At December 31,
2006 2005
------------------- -------------------
Principal % of Principal % of
Balances Portfolio Balances Portfolio
--------- --------- --------- ---------
Consumer home equity and
other $19,950 .36 % $18,556 .36 %
Commercial real estate 108 - 10,038 .44
Commercial business 241 .04 819 .19
Leasing and equipment
finance 7,056 .42 6,182 .41
Residential real estate 7,195 1.04 8,009 1.04
--------- ---------
Total $34,550 .32 $43,604 .43
========= =========
At June 30,
2005
-------------------
Principal % of
Balances Portfolio
--------- ---------
Consumer home equity and
other $16,406 .34 %
Commercial real estate 663 .03
Commercial business 292 .07
Leasing and equipment
finance 6,069 .44
Residential real estate 8,617 .98
---------
Total $32,047 .33
=========
At At At Change from
---------------------
June 30, December 31, June 30, December 31, June 30,
2006 2005 2005 2005 2005
-------- ------------ -------- ------------ --------
Accruing loans
and leases 90
or more days
past due $7,070 $6,475 $6,165 $595 $905
======== ============ ======== ============ ========
Potential Problem Loans and Leases (3):
---------------------------------------
Change from
At At At ---------------------
June 30, December 31, June 30, December 31, June 30,
2006 2005 2005 2005 2005
-------- ------------ -------- ------------ --------
Commercial real
estate $28,084 $35,341 $29,256 $(7,257) $(1,172)
Commercial
business 15,440 11,793 21,997 3,647 (6,557)
Leasing and
equipment
finance 7,859 7,648 8,855 211 (996)
-------- ------------ -------- ------------ --------
$51,383 $54,782 $60,108 $(3,399) $(8,725)
======== ============ ======== ============ ========
(1) Annualized.
(2) Excludes non-accrual loans and leases.
(3) Consists of loans and leases primarily classified for regulatory
purposes as substandard and reflect the distinct possibility, but
not probability, that they will become non-performing or that TCF
will not be able to collect all amounts due according to the
contractual terms of the loan or lease agreement.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
Three Months Ended June 30,
-------------------------------------
2006
-------------------------------------
Average Yields and
Balance Interest Rates (1)
------------- ---------- -----------
ASSETS
Investments $69,176 $792 4.59 %
Securities available for sale 1,880,671 25,156 5.35
Education loans held for sale 228,492 4,205 7.38
Loans and leases:
Consumer home equity:
Fixed-rate 3,721,249 63,061 6.80
Variable-rate 1,689,403 36,611 8.69
Consumer - other 34,854 921 10.60
------------- ----------
Total consumer home equity
and other 5,445,506 100,593 7.41
Commercial real estate:
Fixed- and adjustable-rate 1,672,864 26,007 6.24
Variable-rate 725,561 13,754 7.60
------------- ----------
Total commercial real estate 2,398,425 39,761 6.65
Commercial business:
Fixed- and adjustable-rate 127,702 1,969 6.18
Variable-rate 372,828 6,940 7.47
------------- ----------
Total commercial business 500,530 8,909 7.14
Leasing and equipment finance 1,624,781 29,370 7.23
------------- ----------
Subtotal 9,969,242 178,633 7.18
Residential real estate 714,432 10,355 5.80
------------- ----------
Total loans and leases 10,683,674 188,988 7.09
------------- ----------
Total interest-earning
assets 12,862,013 219,141 6.83
------------- ----------
Other assets 1,105,735
-------------
Total assets $13,967,748
=============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,557,933
Small business 604,776
Commercial and custodial 234,188
-------------
Total non-interest bearing
deposits 2,396,897
Interest-bearing deposits:
Premier checking 1,000,749 7,923 3.18
Other checking 893,800 512 .23
------------- ----------
Subtotal 1,894,549 8,435 1.79
Premier savings 855,979 8,612 4.04
Other savings 1,415,767 2,970 .84
------------- ----------
Subtotal 2,271,746 11,582 2.04
Money market 610,766 3,429 2.25
------------- ----------
Subtotal 4,777,061 23,446 1.97
Certificates of deposit 2,249,694 22,801 4.07
------------- ----------
Total interest-bearing
deposits 7,026,755 46,247 2.64
------------- ----------
Total deposits 9,423,652 46,247 1.97
------------- ----------
Borrowings:
Short-term borrowings 573,418 7,140 4.99
Long-term borrowings 2,703,623 30,312 4.50
------------- ----------
Total borrowings 3,277,041 37,452 4.58
------------- ----------
Total deposits and borrowings 12,700,693 83,699 2.64
------------- ----------
Other liabilities 300,436
-------------
Total liabilities 13,001,129
Stockholders' equity 966,619
-------------
Total liabilities and
stockholders' equity $13,967,748
=============
Net interest income and margin $135,442 4.22 %
========== ===========
(1) Annualized.
Three Months Ended June 30,
-------------------------------------
2005
-------------------------------------
Average Yields and
Balance Interest Rates (1)
------------- ---------- -----------
ASSETS
Investments $101,305 $1,094 4.33 %
Securities available for sale 1,646,986 21,325 5.18
Education loans held for sale 213,279 2,566 4.83
Loans and leases:
Consumer home equity:
Fixed-rate 2,048,035 34,323 6.72
Variable-rate 2,594,538 43,806 6.77
Consumer - other 34,012 779 9.19
------------- ----------
Total consumer home equity
and other 4,676,585 78,908 6.77
Commercial real estate:
Fixed- and adjustable-rate 1,365,132 20,910 6.14
Variable-rate 834,876 11,903 5.72
------------- ----------
Total commercial real estate 2,200,008 32,813 5.98
Commercial business:
Fixed- and adjustable-rate 73,654 1,056 5.75
Variable-rate 359,269 4,978 5.56
------------- ----------
Total commercial business 432,923 6,034 5.59
Leasing and equipment finance 1,412,520 24,133 6.83
------------- ----------
Subtotal 8,722,036 141,888 6.52
Residential real estate 919,379 13,126 5.71
------------- ----------
Total loans and leases 9,641,415 155,014 6.44
------------- ----------
Total interest-earning
assets 11,602,985 179,999 6.22
------------- ----------
Other assets 1,099,048
-------------
Total assets $12,702,033
=============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,589,015
Small business 571,701
Commercial and custodial 311,463
-------------
Total non-interest bearing
deposits 2,472,179
Interest-bearing deposits:
Premier checking 580,093 2,950 2.04
Other checking 1,075,421 561 .21
------------- ----------
Subtotal 1,655,514 3,511 .85
Premier savings 345,567 2,160 2.51
Other savings 1,603,720 2,137 .53
------------- ----------
Subtotal 1,949,287 4,297 .88
Money market 633,762 1,564 .99
------------- ----------
Subtotal 4,238,563 9,372 .89
Certificates of deposit 1,707,919 11,274 2.65
------------- ----------
Total interest-bearing
deposits 5,946,482 20,646 1.39
------------- ----------
Total deposits 8,418,661 20,646 .98
------------- ----------
Borrowings:
Short-term borrowings 920,471 6,908 3.01
Long-term borrowings 2,075,264 21,160 4.09
------------- ----------
Total borrowings 2,995,735 28,068 3.76
------------- ----------
Total deposits and borrowings 11,414,396 48,714 1.71
------------- ----------
Other liabilities 352,861
-------------
Total liabilities 11,767,257
Stockholders' equity 934,776
-------------
Total liabilities and
stockholders' equity $12,702,033
=============
Net interest income and margin $131,285 4.53 %
========== ===========
(1) Annualized.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
Six Months Ended June 30,
-------------------------------------
2006
-------------------------------------
Average Yields and
Balance Interest Rates (1)
------------- ---------- -----------
ASSETS
Investments $69,912 $1,469 4.22 %
Securities available for sale 1,831,402 48,855 5.34
Education loans held for sale 254,692 8,552 6.77
Loans and leases:
Consumer home equity:
Fixed-rate 3,536,733 118,583 6.76
Variable-rate 1,776,991 74,335 8.44
Consumer - other 34,843 1,714 9.92
------------- ----------
Total consumer home equity
and other 5,348,567 194,632 7.34
Commercial real estate:
Fixed- and adjustable-rate 1,621,257 49,933 6.21
Variable-rate 742,935 27,222 7.39
------------- ----------
Total commercial real estate 2,364,192 77,155 6.58
Commercial business:
Fixed- and adjustable-rate 121,757 3,718 6.16
Variable-rate 353,331 12,575 7.18
------------- ----------
Total commercial business 475,088 16,293 6.92
Leasing and equipment finance 1,579,161 56,656 7.18
------------- ----------
Subtotal 9,767,008 344,736 7.11
Residential real estate 733,004 21,235 5.80
------------- ----------
Total loans and leases 10,500,012 365,971 7.02
------------- ----------
Total interest-earning
assets 12,656,018 424,847 6.75
------------- ----------
Other assets 1,134,190
-------------
Total assets $13,790,208
=============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,555,983
Small business 597,548
Commercial and custodial 258,164
-------------
Total non-interest bearing
deposits 2,411,695
Interest-bearing deposits:
Premier checking 969,575 14,954 3.11
Other checking 901,835 1,068 .24
------------- ----------
Subtotal 1,871,410 16,022 1.73
Premier savings 818,222 15,911 3.92
Other savings 1,428,223 6,084 .86
------------- ----------
Subtotal 2,246,445 21,995 1.97
Money market 640,022 6,975 2.20
------------- ----------
Subtotal 4,757,877 44,992 1.91
Certificates of deposit 2,128,341 41,102 3.89
------------- ----------
Total interest-bearing
deposits 6,886,218 86,094 2.52
------------- ----------
Total deposits 9,297,913 86,094 1.87
------------- ----------
Borrowings:
Short-term borrowings 623,863 14,643 4.73
Long-term borrowings 2,593,321 57,500 4.47
------------- ----------
Total borrowings 3,217,184 72,143 4.52
------------- ----------
Total deposits and borrowings 12,515,097 158,237 2.55
------------- ----------
Other liabilities 304,060
-------------
Total liabilities 12,819,157
Stockholders' equity 971,051
-------------
Total liabilities and
stockholders' equity $13,790,208
=============
Net interest income and margin $266,610 4.23 %
========== ===========
(1) Annualized.
Six Months Ended June 30,
-------------------------------------
2005
-------------------------------------
Average Yields and
Balance Interest Rates (1)
------------- ---------- -----------
ASSETS
Investments $103,643 $2,146 4.17 %
Securities available for sale 1,655,154 42,820 5.17
Education loans held for sale 210,371 4,820 4.62
Loans and leases:
Consumer home equity:
Fixed-rate 1,902,409 63,467 6.73
Variable-rate 2,647,837 86,531 6.59
Consumer - other 35,023 1,564 9.01
------------- ----------
Total consumer home equity
and other 4,585,269 151,562 6.67
Commercial real estate:
Fixed- and adjustable-rate 1,346,251 40,977 6.14
Variable-rate 838,009 22,772 5.48
------------- ----------
Total commercial real estate 2,184,260 63,749 5.89
Commercial business:
Fixed- and adjustable-rate 74,307 2,100 5.70
Variable-rate 345,986 9,095 5.30
------------- ----------
Total commercial business 420,293 11,195 5.37
Leasing and equipment finance 1,401,094 47,924 6.84
------------- ----------
Subtotal 8,590,916 274,430 6.43
Residential real estate 951,891 27,128 5.71
------------- ----------
Total loans and leases 9,542,807 301,558 6.36
------------- ----------
Total interest-earning
assets 11,511,975 351,344 6.14
------------- ----------
Other assets 1,086,604
-------------
Total assets $12,598,579
=============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,580,426
Small business 559,448
Commercial and custodial 312,543
-------------
Total non-interest bearing
deposits 2,452,417
Interest-bearing deposits:
Premier checking 520,073 5,055 1.96
Other checking 1,082,442 924 .17
------------- ----------
Subtotal 1,602,515 5,979 .75
Premier savings 313,725 3,811 2.45
Other savings 1,605,131 3,782 .48
------------- ----------
Subtotal 1,918,856 7,593 .80
Money market 640,442 2,635 .83
------------- ----------
Subtotal 4,161,813 16,207 .79
Certificates of deposit 1,650,619 20,377 2.49
------------- ----------
Total interest-bearing
deposits 5,812,432 36,584 1.27
------------- ----------
Total deposits 8,264,849 36,584 .89
------------- ----------
Borrowings:
Short-term borrowings 947,512 12,988 2.76
Long-term borrowings 2,095,205 41,434 3.99
------------- ----------
Total borrowings 3,042,717 54,422 3.60
------------- ----------
Total deposits and borrowings 11,307,566 91,006 1.62
------------- ----------
Other liabilities 357,727
-------------
Total liabilities 11,665,293
Stockholders' equity 933,286
-------------
Total liabilities and
stockholders' equity $12,598,579
=============
Net interest income and margin $260,338 4.54 %
========== ===========
(1) Annualized.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY STATEMENTS OF INCOME AND FINANCIAL RATIOS
(Dollars in thousands, except per-share data)
(Unaudited)
At or For the Three Months Ended
-------------------------------------------------
Jun. 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30,
2006 2006 2005 2005 2005
--------- --------- --------- --------- ---------
Interest income:
Loans and leases $188,988 $176,983 $171,436 $163,178 $155,014
Securities
available for
sale 25,156 23,699 20,766 17,893 21,325
Education loans
held for sale 4,205 4,347 3,342 2,759 2,566
Investments 792 677 841 463 1,094
--------- --------- --------- --------- ---------
Total interest
income 219,141 205,706 196,385 184,293 179,999
--------- --------- --------- --------- ---------
Interest expense:
Deposits 46,247 39,847 34,283 26,539 20,646
Borrowings 37,452 34,691 32,820 29,684 28,068
--------- --------- --------- --------- ---------
Total interest
expense 83,699 74,538 67,103 56,223 48,714
--------- --------- --------- --------- ---------
Net interest
income 135,442 131,168 129,282 128,070 131,285
Provision for
credit losses 3,097 1,507 3,637 3,394 1,427
--------- --------- --------- --------- ---------
Net interest
income after
provision for
credit losses 132,345 129,661 125,645 124,676 129,858
--------- --------- --------- --------- ---------
Non-interest
income:
Fees and service
charges 71,099 61,555 67,716 70,315 66,755
Card revenue 22,984 21,262 21,419 21,025 19,717
ATM revenue 9,762 9,099 9,557 10,646 10,795
Investments and
insurance revenue 2,894 2,488 2,339 2,682 2,791
--------- --------- --------- --------- ---------
Subtotal 106,739 94,404 101,031 104,668 100,058
Leasing and
equipment finance 12,552 11,915 15,405 10,197 11,092
Other 4,331 11,180 8,590 7,752 2,051
--------- --------- --------- --------- ---------
Fees and other
revenue 123,622 117,499 125,026 122,617 113,201
Gains on sales of
securities
available for
sale - - - 995 4,437
--------- --------- --------- --------- ---------
Total non-
interest income 123,622 117,499 125,026 123,612 117,638
--------- --------- --------- --------- ---------
Non-interest
expense:
Compensation and
employee benefits 85,083 86,168 82,700 80,402 81,973
Occupancy and
equipment 27,998 28,051 27,819 25,931 24,771
Advertising and
promotions 6,755 5,716 6,088 6,578 6,778
Deposit account
losses 5,673 4,013 6,607 6,591 3,708
Other 36,537 35,976 35,264 34,411 32,950
--------- --------- --------- --------- ---------
Total non-
interest expense 162,046 159,924 158,478 153,913 150,180
--------- --------- --------- --------- ---------
Income before
income tax
expense 93,921 87,236 92,193 94,375 97,316
Income tax expense 26,860 29,014 26,653 28,889 26,675
--------- --------- --------- --------- ---------
Net income $67,061 $58,222 $65,540 $65,486 $70,641
========= ========= ========= ========= =========
Net income per
common share:
Basic $.52 $.45 $.50 $.50 $.53
========= ========= ========= ========= =========
Diluted $.52 $.45 $.50 $.50 $.53
========= ========= ========= ========= =========
Dividends declared
per common share $.23 $.23 $.2125 $.2125 $.2125
========= ========= ========= ========= =========
Financial Ratios and Other Information:
---------------------------------------
Return on average
assets (1) 1.92 % 1.71 % 2.01 % 2.07 % 2.22 %
Return on average
common equity (1) 27.75 23.82 27.09 27.41 30.23
Net interest margin
(1) 4.22 4.25 4.31 4.43 4.53
Net charge-offs as
a percentage of
average loans and
leases (1) .12 .10 .09 .85 .08
Average total
equity to average
assets 6.92 % 7.18 % 7.40 % 7.56 % 7.36 %
(1) Annualized.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY AVERAGE BALANCE SHEETS AND SUPPLEMENTAL
INFORMATION
(In thousands)
(Unaudited)
Jun. 30, Mar. 31, Dec. 31,
2006 2006 2005
------------ ------------ ------------
ASSETS
Cash and due from banks $325,715 $332,293 $346,555
Investments 69,176 70,655 83,027
Securities available for sale 1,880,671 1,781,586 1,577,967
Education loans held for sale 228,492 281,185 230,623
Loans and leases:
Consumer home equity:
Fixed-rate 3,721,249 3,350,168 2,944,673
Variable-rate 1,689,403 1,865,549 2,120,363
Consumer - other 34,854 34,833 34,544
------------ ------------ ------------
Total consumer home equity
and other 5,445,506 5,250,550 5,099,580
Commercial real estate:
Fixed- and adjustable-rate 1,672,864 1,569,078 1,451,488
Variable-rate 725,561 760,501 809,855
------------ ------------ ------------
Total commercial real estate 2,398,425 2,329,579 2,261,343
Commercial business:
Fixed- and adjustable-rate 127,702 115,745 106,974
Variable-rate 372,828 333,619 321,436
------------ ------------ ------------
Total commercial business 500,530 449,364 428,410
Leasing and equipment finance 1,624,781 1,533,034 1,461,491
------------ ------------ ------------
Subtotal 9,969,242 9,562,527 9,250,824
Residential real estate 714,432 751,782 792,245
------------ ------------ ------------
Total loans and leases 10,683,674 10,314,309 10,043,069
Allowance for loan and lease
losses (59,524) (59,488) (59,509)
------------ ------------ ------------
Net loans and leases 10,624,150 10,254,821 9,983,560
Premises and equipment 381,174 372,746 358,505
Goodwill 152,599 152,599 152,599
Other assets 305,771 364,809 336,464
------------ ------------ ------------
$13,967,748 $13,610,694 $13,069,300
============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest-bearing deposits:
Retail $1,557,933 $1,554,008 $1,492,418
Small business 604,776 590,240 623,310
Commercial and custodial 234,188 282,408 295,910
------------ ------------ ------------
Total non-interest bearing
deposits 2,396,897 2,426,656 2,411,638
Interest-bearing deposits:
Premier checking 1,000,749 938,055 827,742
Other checking 893,800 909,960 936,517
------------ ------------ ------------
Subtotal 1,894,549 1,848,015 1,764,259
Premier savings 855,979 780,046 640,444
Other savings 1,415,767 1,440,818 1,475,505
------------ ------------ ------------
Subtotal 2,271,746 2,220,864 2,115,949
Money market 610,766 669,602 649,123
------------ ------------ ------------
Subtotal 4,777,061 4,738,481 4,529,331
Certificates of deposit 2,249,694 2,005,639 1,886,787
------------ ------------ ------------
Total interest-bearing
deposits 7,026,755 6,744,120 6,416,118
------------ ------------ ------------
Total deposits 9,423,652 9,170,776 8,827,756
------------ ------------ ------------
Borrowings:
Short-term borrowings 573,418 674,868 739,372
Long-term borrowings 2,703,623 2,481,793 2,207,711
------------ ------------ ------------
Total borrowings 3,277,041 3,156,661 2,947,083
Accrued expenses and other
liabilities 300,436 305,672 326,693
------------ ------------ ------------
Total liabilities 13,001,129 12,633,109 12,101,532
------------ ------------ ------------
Stockholders' equity:
Common stock 1,842 1,843 1,844
Additional paid-in capital 467,768 469,062 496,442
Retained earnings 1,573,856 1,541,523 1,510,336
Accumulated other comprehensive
loss (48,838) (24,638) (24,157)
Treasury stock at cost and
other (1,028,009) (1,010,205) (1,016,697)
------------ ------------ ------------
966,619 977,585 967,768
------------ ------------ ------------
$13,967,748 $13,610,694 $13,069,300
============ ============ ============
Supplemental Information:
--------------------------------
Securities available for sale $1,880,671 $1,781,586 $1,577,967
Residential real estate loans 714,432 751,782 792,245
------------ ------------ ------------
Total securities available for
sale and residential real
estate loans $2,595,103 $2,533,368 $2,370,212
============ ============ ============
Sept. 30, Jun. 30,
2005 2005
------------ ------------
ASSETS
Cash and due from banks $346,065 $331,110
Investments 91,355 101,305
Securities available for sale 1,393,742 1,646,986
Education loans held for sale 206,850 213,279
Loans and leases:
Consumer home equity:
Fixed-rate 2,454,762 2,048,035
Variable-rate 2,392,934 2,594,538
Consumer - other 34,469 34,012
------------ ------------
Total consumer home equity
and other 4,882,165 4,676,585
Commercial real estate:
Fixed- and adjustable-rate 1,398,340 1,365,132
Variable-rate 822,223 834,876
------------ ------------
Total commercial real estate 2,220,563 2,200,008
Commercial business:
Fixed- and adjustable-rate 85,611 73,654
Variable-rate 348,030 359,269
------------ ------------
Total commercial business 433,641 432,923
Leasing and equipment finance 1,428,653 1,412,520
------------ ------------
Subtotal 8,965,022 8,722,036
Residential real estate 849,069 919,379
------------ ------------
Total loans and leases 9,814,091 9,641,415
Allowance for loan and lease
losses (76,207) (76,774)
------------ ------------
Net loans and leases 9,737,884 9,564,641
Premises and equipment 345,641 333,614
Goodwill 152,599 152,599
Other assets 357,401 358,499
------------ ------------
$12,631,537 $12,702,033
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest-bearing deposits:
Retail $1,539,893 $1,589,015
Small business 600,374 571,701
Commercial and custodial 325,025 311,463
------------ ------------
Total non-interest bearing
deposits 2,465,292 2,472,179
Interest-bearing deposits:
Premier checking 694,835 580,093
Other checking 1,004,507 1,075,421
------------ ------------
Subtotal 1,699,342 1,655,514
Premier savings 436,690 345,567
Other savings 1,549,451 1,603,720
------------ ------------
Subtotal 1,986,141 1,949,287
Money market 632,293 633,762
------------ ------------
Subtotal 4,317,776 4,238,563
Certificates of deposit 1,770,805 1,707,919
------------ ------------
Total interest-bearing
deposits 6,088,581 5,946,482
------------ ------------
Total deposits 8,553,873 8,418,661
------------ ------------
Borrowings:
Short-term borrowings 1,037,240 920,471
Long-term borrowings 1,757,968 2,075,264
------------ ------------
Total borrowings 2,795,208 2,995,735
Accrued expenses and other
liabilities 326,976 352,861
------------ ------------
Total liabilities 11,676,057 11,767,257
------------ ------------
Stockholders' equity:
Common stock 1,844 1,845
Additional paid-in capital 496,496 497,810
Retained earnings 1,473,273 1,431,903
Accumulated other comprehensive
loss (3,104) (1,992)
Treasury stock at cost and
other (1,013,029) (994,790)
------------ ------------
955,480 934,776
------------ ------------
$12,631,537 $12,702,033
============ ============
Supplemental Information:
--------------------------------
Securities available for sale $1,393,742 $1,646,986
Residential real estate loans 849,069 919,379
------------ ------------
Total securities available for
sale and residential real
estate loans $2,242,811 $2,566,365
============ ============
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY YIELDS AND RATES (1)
(Unaudited)
Jun. 30, Mar. 31, Dec. 31, Sept. 30, Jun. 30,
2006 2006 2005 2005 2005
-------- -------- -------- --------- --------
ASSETS
Investments 4.59 % 3.86 % 4.03 % 2.02 % 4.33 %
Securities available
for sale 5.35 5.32 5.26 5.14 5.18
Education loans held
for sale 7.38 6.27 5.75 5.29 4.83
Loans and leases:
Consumer home equity:
Fixed-rate 6.80 6.72 6.66 6.68 6.72
Variable-rate 8.69 8.20 7.68 7.22 6.77
Consumer - other 10.60 9.23 9.58 9.38 9.19
Total consumer home
equity and other 7.41 7.26 7.11 6.96 6.77
Commercial real
estate:
Fixed- and
adjustable-rate 6.24 6.18 6.16 6.15 6.14
Variable-rate 7.60 7.18 6.75 6.27 5.72
Total commercial
real estate 6.65 6.51 6.38 6.20 5.98
Commercial business:
Fixed- and
adjustable-rate 6.18 6.13 5.90 5.88 5.75
Variable-rate 7.47 6.85 6.41 6.02 5.56
Total commercial
business 7.14 6.66 6.29 5.99 5.59
Leasing and equipment
finance 7.23 7.12 7.00 6.74 6.83
Subtotal 7.18 7.03 6.87 6.69 6.52
Residential real
estate 5.80 5.80 5.73 5.73 5.71
Total loans and
leases 7.09 6.94 6.78 6.61 6.44
Total interest-
earning assets 6.83 6.68 6.54 6.37 6.22
LIABILITIES
Interest-bearing
deposits:
Premier checking 3.18 3.04 2.97 2.66 2.04
Other checking .23 .25 .23 .23 .21
Subtotal 1.79 1.67 1.52 1.23 .85
Premier savings 4.04 3.79 3.66 3.21 2.51
Other savings .84 .88 .81 .67 .53
Subtotal 2.04 1.90 1.67 1.23 .88
Money market 2.25 2.15 1.78 1.31 .99
Subtotal 1.97 1.84 1.63 1.24 .89
Certificates of
deposit 4.07 3.70 3.30 2.93 2.65
Total interest-
bearing deposits 2.64 2.40 2.12 1.73 1.39
Total deposits 1.97 1.76 1.54 1.23 .98
Borrowings:
Short-term borrowings 4.99 4.51 4.09 3.52 3.01
Long-term borrowings 4.50 4.44 4.53 4.62 4.09
Total borrowings 4.58 4.45 4.42 4.22 3.76
Total interest-
bearing
liabilities 2.64 2.45 2.26 1.97 1.71
Net interest margin 4.22 % 4.25 % 4.31 % 4.43 % 4.53 %
======== ======== ======== ========= ========
(1) Annualized.
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