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| TCF Reports Record 2005 Annual Earnings and EPS ($2.00, up 7.5 percent) |
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WAYZATA, Minn.--(BUSINESS WIRE)--Jan. 18, 2006--TCF Financial Corporation (TCF) (NYSE:TCB): 2005 YEAR-END HIGHLIGHTS
EARNINGS SUMMARY
($ in thousands, except per-share data)
Three Months Year
Ended December 31, Ended December 31,
------------------------ --------------------------
2005 2004 Change 2005 2004 Change
-------- -------- ------ --------- --------- ------
Net income $65,540 $67,402 (2.8)% $265,132 $254,993 4.0 %
Diluted earnings
per common share .50 .50 - 2.00 1.86 7.5
Financial Ratios
-------------------
Return on average
assets 2.01 % 2.22 % 2.08 % 2.15 %
Return on average
common equity 27.09 28.35 28.03 27.02
Net interest margin 4.31 4.56 4.46 4.54
TCF Financial Corporation ("TCF") (NYSE:TCB) today reported record results for 2005. Diluted earnings per share was a record $2.00 for 2005, compared with $1.86 for 2004. Net income for 2005 was a record $265.1 million, up $10.1 million from 2004. For 2005, return on average assets ("ROA") was 2.08 percent and return on average common equity ("ROE") was 28.03 percent, compared with 2.15 percent and 27.02 percent, respectively, for 2004. Diluted earnings per share was 50 cents for the 2005 fourth quarter, unchanged from the same period of 2004. Net income was $65.5 million for the fourth quarter of 2005, compared with $67.4 million for the same period of 2004. Dividend Increase TCF's Board of Directors has announced, for the fifteenth consecutive year, an increase in the regular quarterly dividend to 23 cents per common share, effective for the first quarter of 2006. This represents an 8.2 percent increase over the 2005 quarterly dividend of 21.25 cents per common share. The dividend is payable on February 28, 2006 to common shareholders of record at the close of business on January 27, 2006. TCF's 10-year compounded dividend growth rate is the 6th highest among the 50 largest banks in the country. Chief Executive Officer's Statement "2005 was a challenging year for TCF. Despite a flat yield curve and the deposit service charge challenges facing the banking industry in 2005, TCF produced record results," said Lynn A. Nagorske, Chief Executive Officer. "TCF remains focused on its long-term strategies of high quality secured lending, targeted new branch expansion and product and service innovation," said Nagorske. Total Revenue
Three Months
($ in thousands) Ended December 31,
-------------------- %
2005 2004 $ Change Change
--------- --------- -------- --------
Net interest income $129,282 $126,489 $2,793 2.2 %
--------- --------- --------
Fees and other revenue:
Fees and service charges 66,744 67,291 (547) (.8)
Card revenue 21,419 17,609 3,810 21.6
ATM revenue 9,557 10,326 (769) (7.4)
Investments and insurance 2,339 2,609 (270) (10.3)
--------- --------- --------
Total banking fees and
other revenue 100,059 97,835 2,224 2.3
Leasing and equipment finance 15,405 21,047 (5,642) (26.8)
Mortgage banking (1) 3,238 (122) 3,360 N.M.
Other 6,324 7,455 (1,131) (15.2)
--------- --------- --------
Total fees and other revenue 125,026 126,215 (1,189) (.9)
--------- --------- --------
Gains on sales of securities - 6,204 (6,204) (100.0)
--------- --------- --------
Total non-interest income 125,026 132,419 (7,393) (5.6)
--------- --------- --------
Total revenue $254,308 $258,908 $(4,600) (1.8)
========= ========= ========
Net interest margin (2) 4.31% 4.56%
Fees and other revenue as a % of:
Total revenue 49.16 48.75
Average assets (2) 3.83 4.15
Year Ended
($ in thousands) December 31,
------------------- %
2005 2004 $ Change Change
--------- --------- -------- -------
Net interest income $517,690 $491,891 $25,799 5.2 %
--------- --------- --------
Fees and other revenue:
Fees and service charges 258,779 271,259 (12,480) (4.6)
Card revenue 79,803 63,463 16,340 25.7
ATM revenue 40,730 42,935 (2,205) (5.1)
Investments and insurance 10,665 12,558 (1,893) (15.1)
--------- --------- --------
Total banking fees and
other revenue 389,977 390,215 (238) (.1)
Leasing and equipment finance 47,387 50,323 (2,936) (5.8)
Mortgage banking (1) 5,578 12,960 (7,382) (57.0)
Other 24,717 14,113 10,604 75.1
--------- --------- --------
Total fees and other revenue 467,659 467,611 48 -
--------- --------- --------
Gains on sales of securities 10,671 22,600 (11,929) (52.8)
--------- --------- --------
Total non-interest income $478,330 $490,211 (11,881) (2.4)
========= ========= --------
Total revenue $996,020 $982,102 $13,918 1.4
========= ========= ========
Net interest margin (2) 4.46% 4.54%
Fees and other revenue as a % of:
Total revenue 46.95 47.61
Average assets (2) 3.67 3.94
----------------------------------------------------------------------
(1) Beginning in 2005, TCF's mortgage banking business no longer
originates or sells loans (see pages 11 and 12).
(2) Annualized.
N.M. Not meaningful.
Net Interest Income TCF's net interest income in 2005 was $517.7 million, up $25.8 million, or 5.2 percent, from 2004. Net interest margin in 2005 was 4.46 percent, compared with 4.54 percent for 2004. The increase in net interest income in 2005 was primarily driven by increased average Power Assets, up $1.1 billion, partially offset by higher funding costs. Fixed- and adjustable-rate Power Assets increased $1.9 billion and variable-rate Power Assets decreased $842.9 million from 2004 due to changing customer preferences to lower cost fixed-rate loans. The increase in average Power Assets was funded primarily by a $704 million increase in average Power Liabilities and a $163.1 million increase in average borrowings. The weighted-average rate on Power Liabilities was 1.15 percent for 2005, up 60 basis points from 2004 and the weighted-average rate on borrowings was 3.96 percent, up 80 basis points from 2004. TCF's net interest income in the fourth quarter of 2005 was $129.3 million, up $2.8 million, or 2.2 percent, from the fourth quarter of 2004 and up $1.2 million from the third quarter of 2005. Net interest margin in the fourth quarter of 2005 was 4.31 percent, compared with 4.56 percent last year and 4.43 percent in the third quarter of 2005. The decrease in the quarter's net interest margin from the fourth quarter of 2004 is primarily due to the average rates on interest-bearing liabilities increasing more than the average yields on interest-earning assets. During the fourth quarter of 2005, TCF purchased $400.4 million of mortgage-backed securities at a yield of 5.68 percent, which were funded by three- and five-year borrowings at a cost of 4.16 percent. These transactions contributed $1 million to net interest income during the fourth quarter and resulted in a reduction in the quarter's net interest margin of approximately seven basis points, as compared with the third quarter of 2005. Non-interest Income Total non-interest income was $478.3 million for 2005, down $11.9 million, or 2.4 percent, from 2004. Increases in card and other revenues were more than offset by lower fees and service charges, leasing and equipment finance revenues, mortgage banking revenues and gains on sales of mortgage-backed securities. Card revenues totaled $79.8 million for 2005, up $16.3 million, or 25.7 percent, from 2004 primarily attributable to an increase in customer transaction volumes and related fees. During 2005, TCF sold $1 billion of mortgage-backed securities and realized gains of $10.7 million, compared with sales of $1.4 billion of mortgage-backed securities and gains of $22.6 million in 2004. Other revenue was $24.7 million for 2005, up $10.6 million from 2004, primarily due to $13.6 million of gains on sales of branch buildings in conjunction with our mature branch renovation program, the Michigan Bank headquarters building and one rural branch, partially offset by a decrease in gains on sales of education loans. Total non-interest income in the fourth quarter of 2005 was $125 million, down $7.4 million, or 5.6 percent, from the fourth quarter of 2004 primarily due to declines in leasing and equipment finance revenues, reflecting the unusually high revenues last year, and lower gains on sales of mortgage-backed securities, partially offset by increased card revenue. Card revenues totaled $21.4 million for the fourth quarter of 2005, up 21.6 percent over the same period in 2004. Leasing and equipment finance revenues were $15.4 million for the fourth quarter of 2005, down $5.6 million from the 2004 fourth quarter primarily due to lower sales-type revenues, partially offset by higher operating lease revenues. Sales-type revenues may fluctuate from quarter to quarter based on customer driven factors not within the control of TCF. Other revenues were $6.3 million for the fourth quarter of 2005, down $1.1 million from the same period of 2004. This decrease was primarily due to a decrease in gains on sales of education loans, partially offset by gains on the sale of a rural branch and other branch buildings. New Branch Expansion TCF opened 28 new branches during 2005, including 18 traditional branches, seven supermarket branches, and three campus branches. TCF has now opened 153 new branches since January 2000, representing 34 percent of TCF's 453 total branches. During the fourth quarter of 2005, TCF opened 13 new branches consisting of nine traditional branches, three supermarket branches and one campus branch. TCF plans to open 24 new branches in 2006, consisting of 17 traditional branches, five supermarket branches, and two campus branches. During the fourth quarter of 2005, TCF announced plans to enter the Phoenix, Arizona metropolitan area market. Initially, TCF plans to open several consumer loan production offices during 2006 with construction of retail branches to begin later in 2006 or early 2007. "The Arizona market has a growing population and excellent demographics. We are excited about the expansion opportunity Arizona presents," said Nagorske.
December 31, December 31, December 31,
(# of branches) 2005 2004 1999
------------ ------------- ------------
Total Branches
--------------
Minnesota 105 101 82
Illinois 202 197 150
Wisconsin 35 34 31
Michigan 63 60 64
Colorado 42 32 10
Indiana 6 6 1
------------ ------------- ------------
453 430 338
============ ============= ============
New Branches(a)
---------------
Traditional 71 53
Supermarket 79 72
Campus 3 -
------------ -------------
Total 153 125
------------ -------------
% of Total Branches 34% 29%
============ =============
----------------------------------------------------------------------
(a) New branches opened since January 1, 2000.
Additional information regarding the results of TCF's new branches opened since January 1, 2000 is summarized as follows:
At or For the Year
Ended
December 31,
-------------------
($ in thousands) 2005 2004 Change % Change
--------- --------- --------- ---------
Number of checking accounts 266,512 206,229 60,283 29.2 %
Average deposits:
Checking $371,440 $251,558 $119,882 47.7
Savings 248,675 135,888 112,787 83.0
Money market 25,849 20,873 4,976 23.8
--------- --------- ---------
Subtotal 645,964 408,319 237,645 58.2
Certificates of deposit 211,465 56,614 154,851 N.M.
--------- --------- ---------
Total deposits $857,429 $464,933 $392,496 84.4
========= ========= =========
Total fees and other revenue
(quarter ended) $18,657 $14,477 $4,180 28.9
========= ========= =========
Total fees and other revenue
(year ended) $68,220 $50,968 $17,252 33.8
========= ========= =========
----------------------------------------------------------------------
N.M. Not meaningful.
Power Assets(R) Average Power Assets grew $1.1 billion, or 14.5 percent, in 2005. "Consumer lending continued to drive Power Asset growth with a $784.2 million, or 19.6 percent, increase in average consumer loan balances over 2004," said Nagorske. TCF's average commercial loan balances increased $197.8 million, or 8.1 percent; and leasing and equipment finance average balances increased $137.3 million, or 10.7 percent, from 2004.
Average Balances for
the Year Ended
December 31,
-----------------------
($ in thousands) 2005 2004 Change % Change
----------- ----------- ----------- ---------
Loans and leases(a):
Consumer home equity
and other
Home equity:
First mortgage lien $3,139,233 $2,663,819 $475,414 17.8 %
Junior lien 1,615,741 1,302,578 313,163 24.0
----------- ----------- -----------
Total consumer home
equity 4,754,974 3,966,397 788,577 19.9
Other 34,763 39,161 (4,398) (11.2)
----------- ----------- -----------
Total consumer home
equity and other 4,789,737 4,005,558 784,179 19.6
Commercial real estate 2,212,839 2,008,943 203,896 10.1
Commercial business 425,704 431,793 (6,089) (1.4)
Leasing and equipment
finance 1,423,264 1,285,925 137,339 10.7
----------- ----------- -----------
Power Assets $8,851,544 $7,732,219 $1,119,325 14.5
=========== =========== ===========
----------------------------------------------------------------------
(a) Excludes residential real estate loans, loans held for sale and
operating leases.
Power Liabilities(R) Average Power Liabilities totaled $8.5 billion for 2005, an increase of $704 million, or 9.1 percent, from 2004. The increase is primarily driven by increases in Premier Checking of $443 million, Premier Savings of $341.6 million and certificates of deposit of $246.5 million, partially offset by declines in other interest-bearing checking, other savings and money market deposits. TCF increased checking accounts by 68,021, or 4.4 percent, in 2005 to 1,603,173 accounts.
Average Balances and
Rates for the Year
Ended December 31,
-----------------------
($ in thousands) 2005 2004 Change % Change
----------- ----------- --------- ---------
Non-interest bearing
deposits:
Retail $1,548,027 $1,504,392 $43,635 2.9 %
Small business 585,860 508,162 77,698 15.3
Commercial and custodial 311,497 342,446 (30,949) (9.0)
----------- ----------- ---------
Total non-interest
bearing deposits 2,445,384 2,355,000 90,384 3.8
Interest-bearing deposits:
Premier checking 641,672 198,651 443,021 N.M.
Other checking 1,026,017 1,140,242 (114,225) (10.0)
----------- ----------- ---------
Subtotal 1,667,689 1,338,893 328,796 24.6
Premier savings 427,070 85,478 341,592 N.M.
Other savings 1,558,423 1,738,374 (179,951) (10.4)
----------- ----------- ---------
Subtotal 1,985,493 1,823,852 161,641 8.9
Money market 640,576 763,925 (123,349) (16.1)
----------- ----------- ---------
Subtotal 4,293,758 3,926,670 367,088 9.3
Certificates of deposit 1,740,440 1,493,938 246,502 16.5
----------- ----------- ---------
Total interest-bearing
deposits 6,034,198 5,420,608 613,590 11.3
----------- ----------- ---------
Power Liabilities $8,479,582 $7,775,608 $703,974 9.1
=========== =========== =========
Number of checking
accounts, period-end 1,603,173 1,535,152 68,021 4.4
----------------------------------------------------------------------
N.M. Not meaningful.
Residential Real Estate Loans and Securities Available for Sale Average balances of residential real estate loans and securities available for sale (consisting primarily of mortgage-backed securities) totaled $2.5 billion for 2005, a decrease of $185.9 million from 2004. At December 31, 2005, the unrealized pre-tax loss on TCF's securities available for sale portfolio was $33.2 million.
Average Balances and
Yields for the Year
Ended December 31, Change
------------------------------------------
($ in thousands) 2005 2004 $ %
----------- ----------- ---------- -------
Securities available for
sale $1,569,808 $1,536,673 $33,135 2.2 %
Residential real estate
loans 885,735 1,104,814 (219,079) (19.8)
----------- ----------- ----------
Total $2,455,543 $2,641,487 $(185,944) (7.0)
=========== =========== ==========
Non-interest Expense Non-interest expense totaled $610.6 million for 2005, a 4.1 percent increase from 2004. Compensation and employee benefits increased $3.7 million, or 1.1 percent, from 2004, primarily due to costs associated with new branch expansion, partially offset by decreases in mortgage banking and commissions and incentives. Occupancy and equipment expenses increased $8.3 million, or 8.7 percent, from 2004, primarily due to increased expenses associated with new branch expansion. Deposit account losses decreased $1.9 million, or 8.5 percent, from 2004, primarily due to lower uncollectable overdraft losses, partially offset by increased fraud losses. Operating lease depreciation increased $5.5 million from 2004, primarily driven by a $25.1 million increase in average operating lease balances in TCF's leasing and equipment finance subsidiaries. Other expenses totaled $126.7 million for 2005, up $9 million from 2004, primarily driven by a $3.1 million increase in card processing and issuance expenses related to the increase in card transactions and revenues, and a $2.4 million increase in net real estate expense as a result of net recoveries on sales of foreclosed properties in 2004. Non-interest expense totaled $158.5 million for the 2005 fourth quarter, up $4.2 million, or 2.7 percent, from $154.3 million for the 2004 fourth quarter. Compensation and employee benefits decreased $3.6 million, or 4.2 percent, from the fourth quarter of 2004, primarily due to lower performance-related commissions and incentives expense. Occupancy and equipment expenses increased $2.8 million, or 11 percent, from the fourth quarter of 2004, due to increased expenses associated with new branch expansion. Deposit account losses increased $1 million, or 18.4 percent, from the fourth quarter of 2004, primarily due to higher fraud losses. Other expenses increased $3 million, or 10.1 percent, from the fourth quarter of 2004, primarily driven by an increase in net real estate expense due to net recoveries on sales of foreclosed properties in 2004, and a $671 thousand increase in card processing and issuance expenses related to the increase in card transactions and revenues.
Three Months Ended
December 31, Change
------------------- ----------------
($ in thousands) 2005 2004 $ %
--------- --------- -------- -------
Compensation and employee
benefits $82,700 $86,338 $(3,638) (4.2)%
Occupancy and equipment 27,819 25,057 2,762 11.0
Advertising and promotions 6,088 6,568 (480) (7.3)
Deposit account losses 6,607 5,580 1,027 18.4
Operating lease depreciation 2,164 700 1,464 N.M.
Other 33,100 30,058 3,042 10.1
--------- --------- --------
Total non-interest expense $158,478 $154,301 $4,177 2.7
========= ========= ========
Year Ended
December 31, Change
------------------- ----------------
($ in thousands) 2005 2004 $ %
--------- --------- -------- -------
Compensation and employee
benefits $326,526 $322,824 $3,702 1.1 %
Occupancy and equipment 103,900 95,617 8,283 8.7
Advertising and promotions 25,691 26,353 (662) (2.5)
Deposit account losses 20,473 22,369 (1,896) (8.5)
Operating lease depreciation 7,335 1,843 5,492 N.M.
Other 126,663 117,673 8,990 7.6
--------- --------- --------
Total non-interest expense $610,588 $586,679 $23,909 4.1
========= ========= ========
----------------------------------------------------------------------
N.M. Not meaningful.
Credit Quality At December 31, 2005, TCF's allowance for loan and lease losses totaled $60.4 million, or .59 percent of loans and leases, compared with $79.9 million, or .85 percent, at December 31, 2004. The provision for credit losses for 2005 was $5 million, down from $10.9 million for 2004, due to improved credit quality and a relatively large commercial loan recovery. Net loan and lease charge-offs in 2005 were $24.5 million, or .25 percent of average loans and leases, up from $9.5 million, or .11 percent in 2004. Net loan and lease charge-offs excluding the leveraged lease charge-off in the third quarter of 2005 were $5.7 million, or .06 percent of average loans and leases for 2005. Net loan and lease charge-offs in the fourth quarter of 2005 were $2.3 million, or .09 percent of average loans and leases, down from $3.2 million, or .14 percent in the same period of 2004. This decrease is primarily due to lower leasing and equipment finance net charge-offs due to improved credit quality, partially offset by slightly higher consumer loan net charge-offs. At December 31, 2005, TCF's over-30-day delinquency rate was .43 percent, up from .37 percent at December 31, 2004. Non-accrual loans and leases were $29.6 million, or .29 percent of net loans and leases, at December 31, 2005, compared with $46.9 million, or .50 percent, at December 31, 2004. Total non-performing assets were $47.4 million, or .35 percent of total assets, at December 31, 2005, down from $64.1 million, or .52 percent, at December 31, 2004. The decrease in non-accrual loans and leases and non-performing assets was primarily due to the 2005 charge-off of the leveraged lease, partially offset by increases in consumer home equity loans in non-accrual status, mainly the result of changes in bankruptcy laws that occurred in October 2005.
Three Months
Ended Year Ended
December 31, December 31,
----------------- -----------------
($ in thousands) 2005 2004 2005 2004
-------- -------- -------- --------
Allowance for loan and lease
losses:
Balance at beginning of period $59,016 $78,976 $79,878 $76,619
Net (charge-offs) recoveries:
Consumer home equity and other (1,999) (806) (5,210) (3,232)
Commercial real estate 76 2 8 (476)
Commercial business (157) (67) 2,173 (153)
Leasing and equipment finance (167) (2,273) (21,384) (5,545)
Residential real estate (10) (27) (91) (73)
-------- -------- -------- --------
Total (2,257) (3,171) (24,504) (9,479)
Provision for credit losses 3,637 4,073 5,022 10,947
Acquired allowance - - - 1,791
-------- -------- -------- --------
Balance at end of period $60,396 $79,878 $60,396 $79,878
======== ======== ======== ========
Key Indicators:
---------------
Annualized net charge-offs as a
percentage of average loans and
leases .09 % .14 % .25 % .11 %
Annualized net charge-offs as a
percentage of average loans and
leases - excluding the leveraged
lease .09 % .14 % .06 % .11 %
Period-end allowance as a
multiple of annualized net
charge-offs 6.7 X 6.3 X 2.5 X 8.4 X
Income before income taxes and
provision for loan losses as a
multiple of net charge-offs 42.5 X 33.0 X 15.7 X 41.7 X
Mortgage Banking At December 31, 2005, TCF's mortgage servicing portfolio totaled $3.4 billion and the mortgage servicing rights asset totaled $37.3 million, or 1.11 percent of the related servicing portfolio, down from $4.5 billion and $46.4 million, respectively, at December 31, 2004. During the fourth quarter of 2005, TCF recorded a $2 million impairment recovery driven by slowing prepayments and slower assumed prepayments in the mortgage servicing rights portfolio, as compared with a $2.5 million impairment charge for the same 2004 period. The following table summarizes the components of mortgage banking revenues.
Three Months
Ended
December 31, Change
--------------- ---------------
($ in thousands) 2005 2004 $ %
------- ------- ------- -------
Servicing income $3,171 $4,170 $(999) (24.0)%
Less mortgage servicing rights:
Amortization 2,086 3,366 (1,280) (38.0)
(Recovery) impairment (2,000) 2,500 (4,500) (180.0)
------- ------- -------
Net servicing income 3,085 (1,696) 4,781 N.M.
Gains on sales of loans (a) - 1,361 (1,361) (100.0)
Other income 153 213 (60) (28.2)
------- ------- -------
Total $3,238 $(122) $3,360 N.M.
======= ======= =======
Year Ended
December 31, Change
----------------- ----------------
($ in thousands) 2005 2004 $ %
-------- -------- -------- -------
Servicing income $13,998 $17,349 $(3,351) (19.3)%
Less mortgage servicing rights:
Amortization 10,108 13,091 (2,983) (22.8)
(Recovery) impairment (1,000) 1,500 (2,500) (166.7)
-------- -------- --------
Net servicing income 4,890 2,758 2,132 77.3
Gains on sales of loans (a) - 8,107 (8,107) (100.0)
Other income 688 2,095 (1,407) (67.2)
-------- -------- --------
Total $5,578 $12,960 $(7,382) (57.0)
======== ======== ========
----------------------------------------------------------------------
(a) Beginning in 2005, TCF's mortgage banking business no longer
originates or sells loans.
N.M. Not meaningful.
Income Taxes TCF's income tax expense was $115.3 million for 2005, or 30.3 percent of pre-tax income, compared with $129.5 million, or 33.7 percent, for 2004. The lower annual effective tax rate for 2005, compared with 2004, was primarily due to the closing of certain previous years' tax returns, clarification of existing state tax legislation and developments in income tax audits. TCF's income tax expense was $26.7 million for the fourth quarter of 2005, or 28.9 percent of pre-tax income, compared with $33.1 million, or 33 percent, for the comparable 2004 period. The lower effective tax rate for the fourth quarter of 2005, compared with the same 2004 period, is primarily due to the same items noted above. Capital TCF repurchased 3,450,000 shares of its common stock during 2005 at an average cost of $27.10 per share. TCF has 6.7 million shares remaining in its stock repurchase programs authorized by its Board of Directors.
($ in thousands, except At December 31, At December 31,
per-share data) 2005 2004
------------------ ----------------
Stockholders' equity $998,472 $958,418
Stockholders' equity to total
assets 7.47 % 7.77 %
Book value per common share $7.46 $6.99
Total risk-based capital $1,049,615 10.68 % $958,900 10.88 %
Total risk-based capital "well-
capitalized" requirement $982,821 10.00 % $881,481 10.00 %
Excess risk-based capital over
"well-capitalized" requirement $66,794 .68 % $77,419 .88 %
Website Information A live webcast of TCF's conference call to discuss 2005 and fourth quarter earnings will be hosted at TCF's website, www.TCFExpress.com, on January 18, 2006 at 10:00 a.m., CT. 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 $13.4 billion in assets. TCF has 453 banking offices in Minnesota, Illinois, Michigan, Wisconsin, Colorado and Indiana. Other TCF affiliates provide leasing and equipment finance, securities brokerage, and investments and insurance sales. Forward-looking 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 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 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; ability to increase the number of checking accounts and the possibility that deposit account losses (fraudulent checks, etc.) may increase; reduced 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; changes in accounting standards or interpretations of existing standards, or monetary, fiscal or tax policies of the federal or state governments; adverse findings in tax audits; changes in credit and other risks posed by TCF's loan, lease and investment portfolios, including declines in commercial or residential real estate values; imposition of vicarious liability on TCF as lessor in its leasing operations; denial of insurance coverage for claims made by TCF; technological, computer-related or operational difficulties; adverse changes in securities markets; the risk that TCF could be unable to effectively manage the volatility of its mortgage servicing portfolio, which could adversely affect earnings; and results of 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 to Shareholders and reports on Forms 10-K, 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
December 31,
-------------------
2005 2004 $ Change % Change
--------- --------- -------- ---------
Interest income:
Loans and leases $171,436 $140,469 $30,967 22.0 %
Securities available for sale 20,766 19,484 1,282 6.6
Loans held for sale 3,342 2,421 921 38.0
Investments 841 1,014 (173) (17.1)
--------- --------- --------
Total interest income 196,385 163,388 32,997 20.2
--------- --------- --------
Interest expense:
Deposits 34,283 12,250 22,033 179.9
Borrowings 32,820 24,649 8,171 33.1
--------- --------- --------
Total interest expense 67,103 36,899 30,204 81.9
--------- --------- --------
Net interest income 129,282 126,489 2,793 2.2
Provision for credit losses 3,637 4,073 (436) (10.7)
--------- --------- --------
Net interest income after
provision for credit losses 125,645 122,416 3,229 2.6
--------- --------- --------
Non-interest income:
Fees and service charges 66,744 67,291 (547) (.8)
Card revenue 21,419 17,609 3,810 21.6
ATM revenue 9,557 10,326 (769) (7.4)
Investments and insurance
revenue 2,339 2,609 (270) (10.3)
--------- --------- --------
Subtotal 100,059 97,835 2,224 2.3
Leasing and equipment finance 15,405 21,047 (5,642) (26.8)
Mortgage banking 3,238 (122) 3,360 N.M.
Other 6,324 7,455 (1,131) (15.2)
--------- --------- --------
Fees and other revenue 125,026 126,215 (1,189) (.9)
Gains on sales of securities
available for sale - 6,204 (6,204) (100.0)
--------- --------- --------
Total non-interest
income 125,026 132,419 (7,393) (5.6)
--------- --------- --------
Non-interest expense:
Compensation and employee
benefits 82,700 86,338 (3,638) (4.2)
Occupancy and equipment 27,819 25,057 2,762 11.0
Advertising and promotions 6,088 6,568 (480) (7.3)
Deposit account losses 6,607 5,580 1,027 18.4
Other 35,264 30,758 4,506 14.6
--------- --------- --------
Total non-interest expense 158,478 154,301 4,177 2.7
--------- --------- --------
Income before income
tax expense 92,193 100,534 (8,341) (8.3)
Income tax expense 26,653 33,132 (6,479) (19.6)
--------- --------- --------
Net income $65,540 $67,402 $(1,862) (2.8)
========= ========= ========
Net income per common share:
Basic $.50 $.50 $- -
========= ========= ========
Diluted $.50 $.50 $- -
========= ========= ========
Dividends declared per common
share $.2125 $.1875 $.025 13.3
========= ========= ========
Average common and common
equivalent shares outstanding
(in thousands):
Basic 131,447 134,760 (3,313) (2.5)
========= ========= ========
Diluted 131,816 135,610 (3,794) (2.8)
========= ========= ========
N.M. Not meaningful.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share data)
(Unaudited)
Year Ended
December 31,
-------------------
2005 2004 $ Change % Change
--------- --------- --------- ---------
Interest income:
Loans and leases $636,172 $527,178 $108,994 20.7 %
Securities available for sale 81,479 80,643 836 1.0
Loans held for sale 10,921 11,533 (612) (5.3)
Investments 3,450 3,455 (5) (.1)
--------- --------- ---------
Total interest income 732,022 622,809 109,213 17.5
--------- --------- ---------
Interest expense:
Deposits 97,406 42,581 54,825 128.8
Borrowings 116,926 88,337 28,589 32.4
--------- --------- ---------
Total interest expense 214,332 130,918 83,414 63.7
--------- --------- ---------
Net interest income 517,690 491,891 25,799 5.2
Provision for credit losses 5,022 10,947 (5,925) (54.1)
--------- --------- ---------
Net interest income after
provision for credit losses 512,668 480,944 31,724 6.6
--------- --------- ---------
Non-interest income:
Fees and service charges 258,779 271,259 (12,480) (4.6)
Card revenue 79,803 63,463 16,340 25.7
ATM revenue 40,730 42,935 (2,205) (5.1)
Investments and insurance
revenue 10,665 12,558 (1,893) (15.1)
--------- --------- ---------
Subtotal 389,977 390,215 (238) (.1)
Leasing and equipment finance 47,387 50,323 (2,936) (5.8)
Mortgage banking 5,578 12,960 (7,382) (57.0)
Other 24,717 14,113 10,604 75.1
--------- --------- ---------
Fees and other revenue 467,659 467,611 48 -
Gains on sales of securities
available for sale 10,671 22,600 (11,929) (52.8)
--------- --------- ---------
Total non-interest
income 478,330 490,211 (11,881) (2.4)
--------- --------- ---------
Non-interest expense:
Compensation and employee
benefits 326,526 322,824 3,702 1.1
Occupancy and equipment 103,900 95,617 8,283 8.7
Advertising and promotions 25,691 26,353 (662) (2.5)
Deposit account losses 20,473 22,369 (1,896) (8.5)
Other 133,998 119,516 14,482 12.1
--------- --------- ---------
Total non-interest expense 610,588 586,679 23,909 4.1
--------- --------- ---------
Income before income tax
expense 380,410 384,476 (4,066) (1.1)
Income tax expense 115,278 129,483 (14,205) (11.0)
--------- --------- ---------
Net income $265,132 $254,993 $10,139 4.0
========= ========= =========
Net income per common share:
Basic $2.00 $1.87 $.13 7.0
========= ========= =========
Diluted $2.00 $1.86 $.14 7.5
========= ========= =========
Dividends declared per common
share $.85 $.75 $.10 13.3
========= ========= =========
Average common and common
equivalent shares outstanding
(in thousands):
Basic 132,379 136,616 (4,237) (3.1)
========= ========= =========
Diluted 132,742 137,175 (4,433) (3.2)
========= ========= =========
N.M. Not meaningful.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per-share data)
(Unaudited)
At At Change
December 31, December 31, ------------------
2005 2004 $ %
------------ ------------ ----------- ------
ASSETS
Cash and due from banks $374,701 $359,798 $14,903 4.1 %
Investments 79,943 103,226 (23,283) (22.6)
Securities available for
sale 1,648,615 1,619,941 28,674 1.8
Loans held for sale 229,820 154,279 75,541 49.0
Loans and leases:
Consumer home equity
and other 5,187,584 4,418,588 768,996 17.4
Commercial real estate 2,297,500 2,154,396 143,104 6.6
Commercial business 435,233 424,135 11,098 2.6
Leasing and equipment
finance 1,503,794 1,375,372 128,422 9.3
------------ ------------ -----------
Subtotal 9,424,111 8,372,491 1,051,620 12.6
Residential real estate 770,441 1,014,166 (243,725) (24.0)
------------ ------------ -----------
Total loans and
leases 10,194,552 9,386,657 807,895 8.6
Allowance for loan and
lease losses (60,396) (79,878) 19,482 24.4
------------ ------------ -----------
Net loans and
leases 10,134,156 9,306,779 827,377 8.9
Premises and equipment 365,146 326,667 38,479 11.8
Goodwill 152,599 152,599 - -
Mortgage servicing rights 37,334 46,442 (9,108) (19.6)
Other assets 343,046 270,836 72,210 26.7
------------ ------------ -----------
$13,365,360 $12,340,567 $1,024,793 8.3
============ ============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Checking $4,279,853 $3,905,987 $373,866 9.6
Savings 2,238,204 1,927,872 310,332 16.1
Money market 677,017 659,686 17,331 2.6
------------ ------------ -----------
Subtotal 7,195,074 6,493,545 701,529 10.8
Certificates of deposit 1,915,620 1,468,650 446,970 30.4
------------ ------------ -----------
Total deposits 9,110,694 7,962,195 1,148,499 14.4
------------ ------------ -----------
Short-term borrowings 472,126 1,056,111 (583,985) (55.3)
Long-term borrowings 2,511,010 2,048,492 462,518 22.6
------------ ------------ -----------
Total borrowings 2,983,136 3,104,603 (121,467) (3.9)
Accrued expenses and
other liabilities 273,058 315,351 (42,293) (13.4)
------------ ------------ -----------
Total
liabilities 12,366,888 11,382,149 984,739 8.7
------------ ------------ -----------
Stockholders' equity:
Common stock, par value
$.01 per share,
280,000,000 shares
authorized; 184,386,193
and 184,939,094
shares issued 1,844 1,849 (5) (.3)
Additional paid-in
capital 497,270 518,741 (21,471) (4.1)
Retained earnings,
subject to certain
restrictions 1,536,611 1,385,760 150,851 10.9
Accumulated other
comprehensive loss (21,215) (1,415) (19,800) N.M.
Treasury stock at cost,
50,609,970 and
47,752,934 shares,
and other (1,016,038) (946,517) (69,521) (7.3)
------------ ------------ -----------
Total
stockholders'
equity 998,472 958,418 40,054 4.2
------------ ------------ -----------
$13,365,360 $12,340,567 $1,024,793 8.3
============ ============ ===========
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 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 (1) 15,313 1.02 21,384 1.50
Residential real estate 616 .08 91 .01
Unallocated (2) - - - -
------------ -----------
Total (3) $60,396 .59 $24,504 .25
============ ===========
At or For the Year Ended December 31, 2004
--------------------------------------------
Allowance Net Charge-offs
as a % of -----------------
Allowance Portfolio $ %
------------ ------------- ----------- -----
Consumer home equity and
other $9,939 .22 % $3,232 .08 %
Commercial real estate 20,742 .96 476 .02
Commercial business 7,696 1.81 153 .04
Leasing and equipment
finance (1) 24,566 1.79 5,545 .43
Residential real estate 796 .08 73 .01
Unallocated (2) 16,139 - - -
------------ -----------
Total (3) $79,878 .85 $9,479 .11
============ ===========
Non-performing assets: Change from
---------------------- At At At -------------------
December September December September December
31, 30, 31, 30, 31,
2005 2005 2004 2005 2004
-------- --------- -------- --------- ---------
Non-accrual loans and
leases:
Consumer home equity
and other $18,410 $9,849 $12,187 $8,561 $6,223
Commercial real
estate 188 188 1,093 - (905)
Commercial business 2,207 2,328 4,533 (121) (2,326)
Leasing and
equipment finance 6,434 6,808 25,678 (374) (19,244)
Residential real
estate 2,409 2,515 3,387 (106) (978)
-------- --------- -------- --------- ---------
Total non-accrual
loans and leases 29,648 21,688 46,878 7,960 (17,230)
Other real estate
owned:
Residential real
estate 14,877 13,919 11,726 958 3,151
Commercial real
estate 2,834 2,886 5,465 (52) (2,631)
-------- --------- -------- --------- ---------
Total other real
estate owned 17,711 16,805 17,191 906 520
-------- --------- -------- --------- ---------
Total non-performing
assets $47,359 $38,493 $64,069 $8,866 $(16,710)
======== ========= ======== ========= =========
Over 30-day delinquency data
(4): At December 31, At September 30,
---------------------------- 2005 2005
------------------- -------------------
Principal % of Principal % of
Balances Portfolio Balances Portfolio
--------- --------- --------- ---------
Consumer home equity and
other $18,556 .36 % $17,351 .35 %
Commercial real estate 10,038 .44 36 -
Commercial business 819 .19 370 .08
Leasing and equipment
finance 6,182 .41 5,651 .40
Residential real estate 8,009 1.04 7,610 .94
--------- ---------
Total $43,604 .43 $31,018 .31
========= =========
At December 31,
2004
--------------------
Principal % of
Balances Portfolio
---------- ---------
Consumer home equity and other $15,436 .35 %
Commercial real estate 32 -
Commercial business 404 .10
Leasing and equipment finance 8,997 .67
Residential real estate 9,516 .94
----------
Total $34,385 .37
==========
Potential Problem
Loans and Leases (5):
----------------------
Change from
At At At -------------------
December September December September December
31, 30, 31, 30, 31,
2005 2005 2004 2005 2004
--------- --------- -------- --------- ---------
Commercial real estate $35,341 $28,228 $34,138 $7,113 $1,203
Commercial business 11,793 13,367 18,112 (1,574) (6,319)
Leasing and equipment
finance 7,648 9,850 18,816 (2,202) (11,168)
--------- --------- -------- --------- ---------
$54,782 $51,445 $71,066 $3,337 $(16,284)
========= ========= ======== ========= =========
(1) For the year ended December 31, 2005, leasing and equipment
finance net charge-offs excluding the leveraged lease were $2.6
million, or .18% of average loans and leases.
(2) In the second quarter of 2005, TCF refined its allowance for loan
and lease losses allocation methodology resulting in the
allocation of the entire allowance for loan and lease losses to
the individual loan and lease portfolios. This change allocates
the previous unallocated portion of the allowance for loan and
lease losses.
(3) For the year ended December 31, 2005, total net charge-offs
excluding the leveraged lease were $5.7 million, or .06% of
average loans and leases.
(4) Excludes non-accrual loans and leases.
(5) 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. Potential
problem loans and leases may also be included in over 30-day
delinquent loans and leases.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
Three Months Ended December 31,
-------------------------------
2005
-------------------------------
Yields
and
Average Rates
Balance Interest (1)
------------ --------- -------
ASSETS
Investments $83,027 $841 4.03 %
Securities available for sale 1,577,967 20,766 5.26
Loans held for sale 230,623 3,342 5.75
Loans and leases:
Consumer home equity - fixed and
adjustable rate 2,944,673 49,457 6.66
Consumer home equity - variable rate 2,120,363 41,059 7.68
Consumer - other 34,544 834 9.58
------------ ---------
Total consumer home equity and
other 5,099,580 91,350 7.11
Commercial real estate - fixed and
adjustable rate 1,451,488 22,550 6.16
Commercial real estate - variable
rate 809,855 13,786 6.75
------------ ---------
Total commercial real estate 2,261,343 36,336 6.38
Commercial business - fixed and
adjustable rate 106,974 1,591 5.90
Commercial business - variable rate 321,436 5,196 6.41
------------ ---------
Total commercial business 428,410 6,787 6.29
Leasing and equipment finance 1,461,491 25,590 7.00
------------ ---------
Subtotal 9,250,824 160,063 6.87
Residential real estate 792,245 11,373 5.73
------------ ---------
Total loans and leases 10,043,069 171,436 6.78
------------ ---------
Total interest-earning assets 11,934,686 196,385 6.54
------------ ---------
Other assets 1,134,614
------------
Total assets $13,069,300
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,492,418
Small business 623,310
Commercial and custodial 295,910
------------
Total non-interest bearing
deposits 2,411,638
Interest-bearing deposits:
Premier checking 827,742 6,201 2.97
Other checking 936,517 550 .23
------------ ---------
Subtotal 1,764,259 6,751 1.52
Premier savings 640,444 5,906 3.66
Other savings 1,475,505 3,025 .81
------------ ---------
Subtotal 2,115,949 8,931 1.67
Money market 649,123 2,914 1.78
------------ ---------
Subtotal 4,529,331 18,596 1.63
Certificates of deposit 1,886,787 15,687 3.30
------------ ---------
Total interest-bearing deposits 6,416,118 34,283 2.12
------------ ---------
Total deposits 8,827,756 34,283 1.54
------------ ---------
Borrowings:
Short-term borrowings 739,372 7,630 4.09
Long-term borrowings 2,207,711 25,190 4.53
------------ ---------
Total borrowings 2,947,083 32,820 4.42
------------ ---------
Total deposits and borrowings 11,774,839 67,103 2.26
------------ ---------
Other liabilities 326,693
------------
Total liabilities 12,101,532
Stockholders' equity 967,768
------------
Total liabilities and
stockholders' equity $13,069,300
============
Net interest income and margin $129,282 4.31 %
========= =======
Three Months Ended December 31,
--------------------------------
2004
--------------------------------
Yields
and
Average Rates
Balance Interest (1)
------------- --------- -------
ASSETS
Investments $105,603 $1,014 3.83 %
Securities available for sale 1,534,776 19,484 5.08
Loans held for sale 254,617 2,421 3.78
Loans and leases:
Consumer home equity - fixed and
adjustable rate 1,571,494 26,786 6.78
Consumer home equity - variable
rate 2,699,156 40,676 6.00
Consumer - other 37,403 768 8.17
------------- ---------
Total consumer home equity and
other 4,308,053 68,230 6.30
Commercial real estate - fixed and
adjustable rate 1,288,793 19,881 6.14
Commercial real estate - variable
rate 805,219 9,593 4.74
------------- ---------
Total commercial real estate 2,094,012 29,474 5.60
Commercial business - fixed and
adjustable rate 76,906 1,115 5.77
Commercial business - variable rate 353,752 3,982 4.48
------------- ---------
Total commercial business 430,658 5,097 4.71
Leasing and equipment finance 1,341,985 23,031 6.86
------------- ---------
Subtotal 8,174,708 125,832 6.13
Residential real estate 1,027,302 14,637 5.69
------------- ---------
Total loans and leases 9,202,010 140,469 6.08
------------- ---------
Total interest-earning assets 11,097,006 163,388 5.87
------------- ---------
Other assets 1,072,330
-------------
Total assets $12,169,336
=============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,493,345
Small business 557,103
Commercial and custodial 332,227
-------------
Total non-interest bearing
deposits 2,382,675
Interest-bearing deposits:
Premier checking 343,266 1,424 1.65
Other checking 1,106,934 276 .10
------------- ---------
Subtotal 1,450,200 1,700 .47
Premier savings 198,769 1,099 2.20
Other savings 1,621,810 1,239 .30
------------- ---------
Subtotal 1,820,579 2,338 .51
Money market 685,885 793 .46
------------- ---------
Subtotal 3,956,664 4,831 .49
Certificates of deposit 1,469,735 7,419 2.01
------------- ---------
Total interest-bearing deposits 5,426,399 12,250 .90
------------- ---------
Total deposits 7,809,074 12,250 .62
------------- ---------
Borrowings:
Short-term borrowings 1,003,746 5,142 2.04
Long-term borrowings 2,045,505 19,507 3.80
------------- ---------
Total borrowings 3,049,251 24,649 3.22
------------- ---------
Total deposits and borrowings 10,858,325 36,899 1.35
------------- ---------
Other liabilities 360,004
-------------
Total liabilities 11,218,329
Stockholders' equity 951,007
-------------
Total liabilities and
stockholders' equity $12,169,336
=============
Net interest income and margin $126,489 4.56 %
========= =======
(1) Annualized.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Dollars in thousands)
(Unaudited)
Year Ended December 31,
------------------------------
2005
------------------------------
Yields
Average and
Balance Interest Rates
------------ --------- ------
ASSETS
Investments $95,349 $3,450 3.62 %
Securities available for sale 1,569,808 81,479 5.19
Loans held for sale 214,588 10,921 5.09
Loans and leases:
Consumer home equity - fixed and
adjustable rate 2,304,340 154,241 6.69
Consumer home equity - variable rate 2,450,634 171,133 6.98
Consumer - other 34,763 3,213 9.24
------------ ---------
Total consumer home equity and other 4,789,737 328,587 6.86
Commercial real estate - fixed and
adjustable rate 1,385,905 85,214 6.15
Commercial real estate - variable
rate 826,934 49,561 5.99
------------ ---------
Total commercial real estate 2,212,839 134,775 6.09
Commercial business - fixed and
adjustable rate 85,390 4,959 5.81
Commercial business - variable rate 340,314 19,575 5.75
------------ ---------
Total commercial business 425,704 24,534 5.76
Leasing and equipment finance 1,423,264 97,596 6.86
------------ ---------
Subtotal 8,851,544 585,492 6.61
Residential real estate 885,735 50,680 5.72
------------ ---------
Total loans and leases 9,737,279 636,172 6.53
------------ ---------
Total interest-earning assets 11,617,024 732,022 6.30
------------ ---------
Other assets 1,108,510
------------
Total assets $12,725,534
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,548,027
Small business 585,860
Commercial and custodial 311,497
------------
Total non-interest bearing deposits 2,445,384
Interest-bearing deposits:
Premier checking 641,672 15,910 2.48
Other checking 1,026,017 2,067 .20
------------ ---------
Subtotal 1,667,689 17,977 1.08
Premier savings 427,070 13,246 3.10
Other savings 1,558,423 9,419 .60
------------ ---------
Subtotal 1,985,493 22,665 1.14
Money market 640,576 7,640 1.19
------------ ---------
Subtotal 4,293,758 48,282 1.12
Certificates of deposit 1,740,440 49,124 2.82
------------ ---------
Total interest-bearing deposits 6,034,198 97,406 1.61
------------ ---------
Total deposits 8,479,582 97,406 1.15
------------ ---------
Borrowings:
Short-term borrowings 917,665 29,830 3.25
Long-term borrowings 2,038,561 87,096 4.27
------------ ---------
Total borrowings 2,956,226 116,926 3.96
------------ ---------
Total deposits and borrowings 11,435,808 214,332 1.87
------------ ---------
Other liabilities 343,876
------------
Total liabilities 11,779,684
Stockholders' equity 945,850
------------
Total liabilities and
stockholders' equity $12,725,534
============
Net interest income and margin $517,690 4.46 %
========= ======
Year Ended December 31,
------------------------------
2004
------------------------------
Yields
Average and
Balance Interest Rates
------------ --------- ------
ASSETS
Investments $124,833 $3,455 2.77 %
Securities available for sale 1,536,673 80,643 5.25
Loans held for sale 331,529 11,533 3.48
Loans and leases:
Consumer home equity - fixed and
adjustable rate 1,509,055 104,494 6.92
Consumer home equity - variable rate 2,457,342 137,735 5.61
Consumer - other 39,161 3,210 8.20
------------ ---------
Total consumer home equity and other 4,005,558 245,439 6.13
Commercial real estate - fixed and
adjustable rate 1,237,633 77,187 6.24
Commercial real estate - variable
rate 771,310 33,259 4.31
------------ ---------
Total commercial real estate 2,008,943 110,446 5.50
Commercial business - fixed and
adjustable rate 85,382 4,754 5.57
Commercial business - variable rate 346,411 13,815 3.99
------------ ---------
Total commercial business 431,793 18,569 4.30
Leasing and equipment finance 1,285,925 89,364 6.95
------------ ---------
Subtotal 7,732,219 463,818 6.00
Residential real estate 1,104,814 63,360 5.73
------------ ---------
Total loans and leases 8,837,033 527,178 5.97
------------ ---------
Total interest-earning assets 10,830,068 622,809 5.75
------------ ---------
Other assets 1,052,679
------------
Total assets $11,882,747
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest bearing deposits:
Retail $1,504,392
Small business 508,162
Commercial and custodial 342,446
------------
Total non-interest bearing deposits 2,355,000
Interest-bearing deposits:
Premier checking 198,651 2,892 1.46
Other checking 1,140,242 928 .08
------------ ---------
Subtotal 1,338,893 3,820 .29
Premier savings 85,478 1,705 1.99
Other savings 1,738,374 5,785 .33
------------ ---------
Subtotal 1,823,852 7,490 .41
Money market 763,925 2,992 .39
------------ ---------
Subtotal 3,926,670 14,302 .36
Certificates of deposit 1,493,938 28,279 1.89
------------ ---------
Total interest-bearing deposits 5,420,608 42,581 .79
------------ ---------
Total deposits 7,775,608 42,581 .55
------------ ---------
Borrowings:
Short-term borrowings 809,106 12,664 1.57
Long-term borrowings 1,984,069 75,673 3.81
------------ ---------
Total borrowings 2,793,175 88,337 3.16
------------ ---------
Total deposits and borrowings 10,568,783 130,918 1.24
------------ ---------
Other liabilities 370,184
------------
Total liabilities 10,938,967
Stockholders' equity 943,780
------------
Total liabilities and
stockholders' equity $11,882,747
============
Net interest income and margin $491,891 4.54 %
========= ======
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY STATEMENTS OF INCOME AND FINANCIAL RATIOS
(Dollars in thousands, except per-share data)
(Unaudited)
Three Months Ended
-------------------------------------------------
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31,
2005 2005 2005 2005 2004
--------- --------- --------- --------- ---------
Interest income:
Loans and leases $171,436 $163,178 $155,014 $146,544 $140,469
Securities
available for
sale 20,766 17,893 21,325 21,495 19,484
Loans held for
sale 3,342 2,759 2,566 2,254 2,421
Investments 841 463 1,094 1,052 1,014
--------- --------- --------- --------- ---------
Total interest
income 196,385 184,293 179,999 171,345 163,388
--------- --------- --------- --------- ---------
Interest expense:
Deposits 34,283 26,539 20,646 15,938 12,250
Borrowings 32,820 29,684 28,068 26,354 24,649
--------- --------- --------- --------- ---------
Total interest
expense 67,103 56,223 48,714 42,292 36,899
--------- --------- --------- --------- ---------
Net interest
income 129,282 128,070 131,285 129,053 126,489
Provision for
credit losses 3,637 3,394 1,427 (3,436) 4,073
--------- --------- --------- --------- ---------
Net interest
income after
provision for
credit losses 125,645 124,676 129,858 132,489 122,416
--------- --------- --------- --------- ---------
Non-interest
income:
Fees and service
charges 66,744 69,341 65,756 56,938 67,291
Card revenue 21,419 21,025 19,717 17,642 17,609
ATM revenue 9,557 10,646 10,795 9,732 10,326
Investments and
insurance revenue 2,339 2,682 2,791 2,853 2,609
--------- --------- --------- --------- ---------
Subtotal 100,059 103,694 99,059 87,165 97,835
Leasing and
equipment finance 15,405 10,197 11,092 10,693 21,047
Mortgage banking 3,238 982 216 1,142 (122)
Other 6,324 7,744 2,834 7,815 7,455
--------- --------- --------- --------- ---------
Fees and other
revenue 125,026 122,617 113,201 106,815 126,215
Gains on sales of
securities
available for
sale - 995 4,437 5,239 6,204
--------- --------- --------- --------- ---------
Total non-
interest
income 125,026 123,612 117,638 112,054 132,419
--------- --------- --------- --------- ---------
Non-interest expense:
Compensation and
employee benefits 82,700 80,402 81,973 81,451 86,338
Occupancy and
equipment 27,819 25,931 24,771 25,379 25,057
Advertising and
promotions 6,088 6,578 6,778 6,247 6,568
Deposit account
losses 6,607 6,591 3,708 3,567 5,580
Other 35,264 34,411 32,950 31,373 30,758
--------- --------- --------- --------- ---------
Total non-
interest expense 158,478 153,913 150,180 148,017 154,301
--------- --------- --------- --------- ---------
Income before
income tax
expense 92,193 94,375 97,316 96,526 100,534
Income tax expense 26,653 28,889 26,675 33,061 33,132
--------- --------- --------- --------- ---------
Net income $65,540 $65,486 $70,641 $63,465 $67,402
========= ========= ========= ========= =========
Net income per
common share:
Basic $.50 $.50 $.53 $.47 $.50
========= ========= ========= ========= =========
Diluted $.50 $.50 $.53 $.47 $.50
========= ========= ========= ========= =========
Dividends declared
per common share $.2125 $.2125 $.2125 $.2125 $.1875
========= ========= ========= ========= =========
Financial Ratios:
-----------------
Return on average
assets (1) 2.01 % 2.07 % 2.22 % 2.03 % 2.22 %
Return on average
common equity (1) 27.09 27.41 30.23 27.18 28.35
Net interest margin
(1) 4.31 4.43 4.53 4.56 4.56
Net charge-offs
(recoveries) as a
percentage of
average loans and
leases (1) 0.09 .85 .08 (.02 ) .14
Average total
equity to average
assets 7.40 7.56 7.36 7.48 7.81
(1) Annualized.
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY AVERAGE BALANCE SHEETS AND SUPPLEMENTAL
INFORMATION
(In thousands)
(Unaudited)
Dec. 31, Sept. 30, Jun. 30,
2005 2005 2005
------------ ------------ ------------
ASSETS
Cash and due from banks $346,555 $346,065 $331,110
Investments 83,027 91,355 101,305
Securities available for sale 1,577,967 1,393,742 1,646,986
Loans held for sale 230,623 206,850 213,279
Loans and leases:
Consumer home equity - fixed
and adjustable rate 2,944,673 2,454,762 2,048,035
Consumer home equity - variable
rate 2,120,363 2,392,934 2,594,538
Consumer - other 34,544 34,469 34,012
------------ ------------ ------------
Total consumer home equity and
other 5,099,580 4,882,165 4,676,585
Commercial real estate - fixed
and adjustable rate 1,451,488 1,398,340 1,365,132
Commercial real estate -
variable rate 809,855 822,223 834,876
------------ ------------ ------------
Total commercial real estate 2,261,343 2,220,563 2,200,008
Commercial business - fixed and
adjustable rate 106,974 85,611 73,654
Commercial business - variable
rate 321,436 348,030 359,269
------------ ------------ ------------
Total commercial business 428,410 433,641 432,923
Leasing and equipment finance 1,461,491 1,428,653 1,412,520
------------ ------------ ------------
Subtotal 9,250,824 8,965,022 8,722,036
Residential real estate 792,245 849,069 919,379
------------ ------------ ------------
Total loans and leases 10,043,069 9,814,091 9,641,415
Allowance for loan and lease
losses (59,509) (76,207) (76,774)
------------ ------------ ------------
Net loans and leases 9,983,560 9,737,884 9,564,641
Premises and equipment 358,505 345,641 333,614
Goodwill 152,599 152,599 152,599
Mortgage servicing rights 37,090 38,773 42,218
Other assets 299,374 318,628 316,281
------------ ------------ ------------
$13,069,300 $12,631,537 $12,702,033
============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest-bearing deposits:
Retail $1,492,418 $1,539,893 $1,589,015
Small business 623,310 600,374 571,701
Commercial and custodial 295,910 325,025 311,463
------------ ------------ ------------
Total non-interest bearing
deposits 2,411,638 2,465,292 2,472,179
Interest-bearing deposits:
Premier checking 827,742 694,835 580,093
Other checking 936,517 1,004,507 1,075,421
------------ ------------ ------------
Subtotal 1,764,259 1,699,342 1,655,514
Premier savings 640,444 436,690 345,567
Other savings 1,475,505 1,549,451 1,603,720
------------ ------------ ------------
Subtotal 2,115,949 1,986,141 1,949,287
Money market 649,123 632,293 633,762
------------ ------------ ------------
Subtotal 4,529,331 4,317,776 4,238,563
Certificates of deposit 1,886,787 1,770,805 1,707,919
------------ ------------ ------------
Total interest-bearing
deposits 6,416,118 6,088,581 5,946,482
------------ ------------ ------------
Total deposits 8,827,756 8,553,873 8,418,661
------------ ------------ ------------
Borrowings:
Short-term borrowings 739,372 1,037,240 920,471
Long-term borrowings 2,207,711 1,757,968 2,075,264
------------ ------------ ------------
Total borrowings 2,947,083 2,795,208 2,995,735
Accrued expenses and other
liabilities 326,693 326,976 352,861
------------ ------------ ------------
Total liabilities 12,101,532 11,676,057 11,767,257
------------ ------------ ------------
Stockholders' equity:
Common stock 1,844 1,844 1,845
Additional paid-in capital 496,442 496,496 497,810
Retained earnings 1,510,336 1,473,273 1,431,903
Accumulated other comprehensive
loss (24,157) (3,104) (1,992)
Treasury stock at cost and
other (1,016,697) (1,013,029) (994,790)
------------ ------------ ------------
967,768 955,480 934,776
------------ ------------ ------------
$13,069,300 $12,631,537 $12,702,033
============ ============ ============
Supplemental Information:
-------------------------
Securities available for sale $1,577,967 $1,393,742 $1,646,986
Residential real estate loans 792,245 849,069 919,379
------------ ------------ ------------
Total securities available for
sale and residential real
estate loans $2,370,212 $2,242,811 $2,566,365
============ ============ ============
Mar. 31, Dec. 31,
2005 2004
------------ ------------
ASSETS
Cash and due from banks $332,800 $350,497
Investments 106,006 105,603
Securities available for sale 1,663,412 1,534,776
Loans held for sale 207,430 254,617
Loans and leases:
Consumer home equity - fixed and adjustable
rate 1,755,164 1,571,494
Consumer home equity - variable rate 2,701,729 2,699,156
Consumer - other 36,046 37,403
------------ ------------
Total consumer home equity and other 4,492,939 4,308,053
Commercial real estate - fixed and
adjustable rate 1,327,160 1,288,793
Commercial real estate - variable rate 841,176 805,219
------------ ------------
Total commercial real estate 2,168,336 2,094,012
Commercial business - fixed and adjustable
rate 74,968 76,906
Commercial business - variable rate 332,555 353,752
------------ ------------
Total commercial business 407,523 430,658
Leasing and equipment finance 1,389,541 1,341,985
------------ ------------
Subtotal 8,458,339 8,174,708
Residential real estate 984,764 1,027,302
------------ ------------
Total loans and leases 9,443,103 9,202,010
Allowance for loan and lease losses (79,918) (79,502)
------------ ------------
Net loans and leases 9,363,185 9,122,508
Premises and equipment 328,336 322,492
Goodwill 152,599 152,599
Mortgage servicing rights 45,101 49,746
Other assets 295,107 276,498
------------ ------------
$12,493,976 $12,169,336
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Non-interest-bearing deposits:
Retail $1,571,741 $1,493,345
Small business 547,060 557,103
Commercial and custodial 313,634 332,227
------------ ------------
Total non-interest bearing deposits 2,432,435 2,382,675
Interest-bearing deposits:
Premier checking 459,385 343,266
Other checking 1,089,541 1,106,934
------------ ------------
Subtotal 1,548,926 1,450,200
Premier savings 281,529 198,769
Other savings 1,606,560 1,621,810
------------ ------------
Subtotal 1,888,089 1,820,579
Money market 647,197 685,885
------------ ------------
Subtotal 4,084,212 3,956,664
Certificates of deposit 1,592,682 1,469,735
------------ ------------
Total interest-bearing deposits 5,676,894 5,426,399
------------ ------------
Total deposits 8,109,329 7,809,074
------------ ------------
Borrowings:
Short-term borrowings 974,853 1,003,746
Long-term borrowings 2,115,369 2,045,505
------------ ------------
Total borrowings 3,090,222 3,049,251
Accrued expenses and other liabilities 360,362 360,004
------------ ------------
Total liabilities 11,559,913 11,218,329
------------ ------------
Stockholders' equity:
Common stock 1,846 1,850
Additional paid-in capital 503,762 518,012
Retained earnings 1,394,163 1,360,169
Accumulated other comprehensive loss (4,139) (527)
Treasury stock at cost and other (961,569) (928,497)
------------ ------------
934,063 951,007
------------ ------------
$12,493,976 $12,169,336
============ ============
Supplemental Information:
-------------------------
Securities available for sale $1,663,412 $1,534,776
Residential real estate loans 984,764 1,027,302
------------ ------------
Total securities available for sale and
residential real estate loans $2,648,176 $2,562,078
============ ============
TCF FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED QUARTERLY YIELDS AND RATES (1)
(Unaudited)
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31,
2005 2005 2005 2005 2004
-------- --------- --------- -------- --------
ASSETS
Investments 4.03 % 2.02 % 4.33 % 4.01 % 3.83 %
Securities available
for sale 5.26 5.14 5.18 5.17 5.08
Loans held for sale 5.75 5.29 4.83 4.41 3.78
Loans and leases:
Consumer home equity
- fixed and
adjustable rate 6.66 6.68 6.72 6.73 6.78
Consumer home equity
- variable rate 7.68 7.22 6.77 6.41 6.00
Consumer - other 9.58 9.38 9.19 8.83 8.17
Total consumer home
equity and other 7.11 6.96 6.77 6.56 6.30
Commercial real
estate - fixed and
adjustable rate 6.16 6.15 6.14 6.13 6.14
Commercial real
estate - variable
rate 6.75 6.27 5.72 5.24 4.74
Total commercial
real estate 6.38 6.20 5.98 5.79 5.60
Commercial business
- fixed and
adjustable rate 5.90 5.88 5.75 5.65 5.77
Commercial business
- variable rate 6.41 6.02 5.56 5.02 4.48
Total commercial
business 6.29 5.99 5.59 5.14 4.71
Leasing and
equipment finance 7.00 6.74 6.83 6.85 6.86
Subtotal 6.87 6.69 6.52 6.34 6.13
Residential real
estate 5.73 5.73 5.71 5.70 5.69
Total loans and
leases 6.78 6.61 6.44 6.27 6.08
Total interest-
earning assets 6.54 6.37 6.22 6.06 5.87
LIABILITIES
Interest-bearing
deposits:
Premier checking 2.97 2.66 2.04 1.86 1.65
Other checking .23 .23 .21 .14 .10
Subtotal 1.52 1.23 .85 .65 .47
Premier savings 3.66 3.21 2.51 2.38 2.20
Other savings .81 .67 .53 .42 .30
Subtotal 1.67 1.23 .88 .71 .51
Money market 1.78 1.31 .99 .67 .46
Subtotal 1.63 1.24 .89 .68 .49
Certificates of
deposit 3.30 2.93 2.65 2.32 2.01
Total interest-
bearing deposits 2.12 1.73 1.39 1.14 .90
Total deposits 1.54 1.23 .98 .80 .62
Borrowings:
Short-term
borrowings 4.09 3.52 3.01 2.53 2.04
Long-term borrowings 4.53 4.62 4.09 3.88 3.80
Total borrowings 4.42 4.22 3.76 3.46 3.22
Total interest-
bearing
liabilities 2.26 1.97 1.71 1.53 1.35
Net interest margin 4.31 % 4.43 % 4.53 % 4.56 % 4.56 %
======== ========= ========= ======== ========
(1) Annualized.
CONTACT: TCF Financial Corporation, Wayzata
SOURCE: TCF Financial Corporation |