Attached files
file | filename |
---|---|
8-K - 8-K - TCF FINANCIAL CORP | a11-10769_18k.htm |
Exhibit 99.1
1.) |
|
TCF Financial Corporation |
|
|
2.) Corporate Profile
At March 31, 2011
· $18.7 billion national bank holding company headquartered in Minnesota
· 32nd largest publicly-traded U.S. based bank holding company by asset size
· 442 bank branches in eight states, 48 branches opened since January 1, 2006
· 25th largest U.S. branch network
· Seven campus alliances; 5th largest in campus card banking relationships
· 956 ATMs free to TCF customers; 475 off-site
· 11th largest issuer of Visa® Classic debit cards
· 12th largest issuer of Visa Commercial debit cards
· 13th largest bank-affiliated leasing company in the U.S.
· Total equity to total assets of 9.22%
· Tangible realized common equity of 8.61% 1
· 64th consecutive quarter of profitability
Branch Summary
Minnesota |
|
111 |
|
Illinois |
|
201 |
|
Michigan |
|
55 |
|
Colorado |
|
36 |
|
Wisconsin |
|
26 |
|
Arizona |
|
7 |
|
Indiana |
|
5 |
|
South Dakota |
|
1 |
|
Total |
|
442 |
|
Well-Diversified Loan Portfolio
($ millions)
|
|
12/31/00 |
|
% of Total |
|
3/31/11 |
|
% of Total |
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
| ||
Consumer Lending |
|
$ |
5,909 |
|
69 |
% |
$ |
7,097 |
|
48 |
% |
|
|
Commercial Lending |
|
1,782 |
|
21 |
|
3,609 |
|
24 |
|
|
| ||
Leasing |
|
856 |
|
10 |
|
3,080 |
|
21 |
|
|
| ||
Inventory Finance |
|
|
|
|
|
1,011 |
|
7 |
|
|
| ||
Total |
|
$ |
8,547 |
|
100 |
% |
$ |
14,797 |
|
100 |
% |
|
|
1 See Reconciliation of GAAP to Non-GAAP Measures - Tangible Realized Common Equity slide
3.) What Makes TCF Different
At March 31, 2011
· Convenience
TCF banks a large and diverse customer base by offering a host of convenient banking services:
· Traditional, supermarket and campus branches open seven days a week
· Free debit cards, free coin counting and 956 free ATMs
· TCF Free Online Banking
· TCF Mobile Banking
· Credit Quality
· TCF is primarily a secured portfolio lender, emphasizing credit quality over asset growth
· Low-cost core deposit funding for national diverse lending platform
· Grew core deposits by $3.3 billion since December 31, 2008. As of March 31, 2011, core deposits carried an average interest rate of .37%
· Increased nationally-oriented specialty finance businesses by $1.6 billion, or 64.3%, since December 31, 2008
4.) What Makes TCF Different
· No deficient foreclosure procedures
· No mortgage repurchase risk
· No non-agency mortgage-backed securities
· No option ARM loans
· No teaser rate or subprime lending programs
· No low-doc/no-doc loans
· No Freddie Mac or Fannie Mae preferred stock
· No mortgage servicing rights
· No off-balance-sheet funding or securitizations
· No bank-owned life insurance
5.) Diversified Revenue Base
At March 31, 2011
Good Revenue Growth
($ millions)
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 1 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net Interest Income |
|
$ |
550 |
|
$ |
594 |
|
$ |
633 |
|
$ |
699 |
|
$ |
174 |
|
Non-interest Income |
|
542 |
|
498 |
|
526 |
|
538 |
|
114 |
| |||||
Total |
|
$ |
1,092 |
|
$ |
1,092 |
|
$ |
1,159 |
|
$ |
1,237 |
|
$ |
288 |
|
Strong Net Interest Margin
(Percent)
|
|
2007 |
|
2008 |
|
2009 |
|
2010 |
|
2011 |
|
TCF, 4.06% |
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
4.00 |
% |
3.84 |
% |
3.66 |
% |
4.21 |
% |
4.06 |
% |
Second Quarter |
|
4.02 |
|
4.00 |
|
3.80 |
|
4.19 |
|
|
|
Third Quarter |
|
3.90 |
|
3.97 |
|
3.92 |
|
4.14 |
|
|
|
Fourth Quarter |
|
3.83 |
|
3.84 |
|
4.08 |
|
4.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
KBW Regional Banking |
|
|
|
|
|
|
|
|
|
|
|
Index Median, 3.69% 2 |
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
3.66 |
% |
3.61 |
% |
3.49 |
% |
3.71 |
% |
|
|
Second Quarter |
|
3.69 |
|
3.64 |
|
3.57 |
|
3.73 |
|
|
|
Third Quarter |
|
3.68 |
|
3.64 |
|
3.64 |
|
3.78 |
|
|
|
Fourth Quarter |
|
3.69 |
|
3.65 |
|
3.68 |
|
3.69 |
|
|
|
Strong Mix of Fee Revenues 1
($ millions)
|
|
3/11 |
|
% of Total |
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Banking Fees and Service Charges |
|
$ |
53 |
|
46 |
% |
|
|
|
|
|
|
Card Revenue |
|
27 |
|
24 |
|
|
|
|
|
|
| |
Specialty Finance |
|
27 |
|
24 |
|
|
|
|
|
|
| |
ATM Revenue and Other |
|
7 |
|
6 |
|
|
|
|
|
|
| |
Total |
|
$ |
114 |
|
100 |
% |
|
|
|
|
|
|
1-Year Interest Rate GAP
|
|
At 3/31/10 |
|
At 3/31/11 |
|
|
|
|
|
|
|
Asset (Liability) Sensitive |
|
(1.5 |
)% |
5.4 |
% |
|
|
|
|
|
|
1 Year-to-date
2 QTD December 31, 2010
6.) Common Stock Offering
· Gross proceeds of $230 million
· Issued 15,081,968 shares at $15.25 per share
· Rationale
· Ability to proactively manage capital structure from a position of strength
· Eliminate all holding company debt and thus eliminate all debt service requirements at the bank
· Increase balance sheet flexibility to aggressively take advantage of marketplace opportunities
· Use of proceeds
· Redeem trust preferred securities upon the occurrence of a capital treatment event
· Repaid all senior unsecured holding company debt
· Allows for immediate and long-term business expansion and portfolio acquisitions in Specialty Finance
7.) Capital Ratios - Holding Company
($ millions)
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total Tier 1 Common Capital |
|
$ |
964 |
|
$ |
999 |
|
$ |
1,042 |
|
$ |
1,352 |
|
$ |
1,601 |
|
Total Tier 1 Common Capital Ratio 1 |
|
8.28 |
% |
8.05 |
% |
7.65 |
% |
9.71 |
% |
11.47 |
% | |||||
At March 31, 2011
· Other Capital Ratios
· Total equity to total assets 9.22%
· Tangible realized common equity 8.61% 2
· Total risk-based capital 14.62%
· Tangible realized common equity has increased eight consecutive quarters
1 See Reconciliation of GAAP to Non-GAAP Measures - Total Tier 1 Common Capital Ratio slide
2 See Reconciliation of GAAP to Non-GAAP Measures - Tangible Realized Common Equity slide
8.) Strong Deposit Franchise
Quarterly Average Balances
($ millions)
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Checking |
|
$ |
3,981 |
|
$ |
3,914 |
|
$ |
4,116 |
|
$ |
4,359 |
|
$ |
4,502 |
|
Savings |
|
2,596 |
|
2,861 |
|
5,231 |
|
5,412 |
|
5,444 |
| |||||
Money Market |
|
598 |
|
625 |
|
672 |
|
644 |
|
674 |
| |||||
Certificates of Deposit (CDs) |
|
2,307 |
|
2,449 |
|
1,367 |
|
1,040 |
|
1,092 |
| |||||
Total |
|
$ |
9,482 |
|
$ |
9,849 |
|
$ |
11,386 |
|
$ |
11,455 |
|
$ |
11,712 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Average Rate 1: |
|
2.29 |
% |
1.51 |
% |
.74 |
% |
.46 |
% |
.42 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
CDs as a % of total deposits: |
|
24.3 |
% |
24.9 |
% |
12.0 |
% |
9.1 |
% |
9.3 |
% |
1 Quarter-to-date (annualized)
9.) Industry Leader in Retail Checking
Product Development
|
|
Bold and Forward Thinking |
|
|
· Among the first to introduce Free Checking in 1986
· Leader in debit card innovations
· Solid opt-in results due to proactive customer education
· Announced checking product enhancement initiative in January 2011
· Removed minimum balance fee requirement
· Monthly maintenance fee waived for meeting account activity requirements
· Launched TCF Mobile Banking
· Pilot of new checking account program began in March 2011
· A single daily fee is assessed when a customers end of day ledger balance is negative
· Improved customer experience through program simplification and transparency
10.) Card Revenue
($ millions)
|
|
2007 |
|
2008 |
|
2009 |
|
2010 |
|
2011 |
|
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
First Quarter |
|
$ |
23 |
|
$ |
25 |
|
$ |
25 |
|
$ |
27 |
|
$ |
27 |
|
|
Second Quarter |
|
25 |
|
27 |
|
27 |
|
29 |
|
|
|
| |||||
Third Quarter |
|
26 |
|
26 |
|
26 |
|
27 |
|
|
|
| |||||
Fourth Quarter |
|
25 |
|
25 |
|
27 |
|
28 |
|
|
|
| |||||
Total |
|
$ |
99 |
|
$ |
103 |
|
$ |
105 |
|
$ |
111 |
|
$ |
27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Sales Volume: |
|
$ |
6,949 |
|
$ |
7,280 |
|
$ |
7,308 |
|
$ |
7,630 |
|
$ |
1,867 |
|
1 |
Average Interchange Rate: |
|
1.35 |
% |
1.34 |
% |
1.34 |
% |
1.38 |
% |
1.35 |
% |
1 |
At March 31, 2011
· 31% of total banking fees
· 11th largest issuer of Visa Classic debit cards
· 12th largest issuer of Visa Commercial debit cards
· $1.9 billion in sales volume 1
· 22.2 transactions per month on active cards, up 7.8% 1
· Average interchange rate of 1.35%
1 Year-to-date
11.) Durbin Amendment
· Durbin Amendment of the Dodd-Frank Act orders Federal Reserve to enact regulations that strictly limit the amount of interchange fees banks can charge retailers on debit card transactions
· Federal Reserve announced proposed rates of 7 to 12 cents per transaction based only on incremental processing fees while specifically excluding other costs such as network costs
· Federal Reserve has received an overwhelming number of comment letters and announced they would be unable to meet the April 21, 2011 deadline for issuing the final interchange rule
· On October 12, 2010, TCF filed a lawsuit challenging the constitutionality of the Durbin Amendment
· Challenge of constitutionality based on due process, the taking clause and equal protection
· On April 4, 2011, a U.S. District judge denied the governments motion to dismiss TCFs complaint and also denied TCFs motion for a preliminary injunction
· TCF appealed the judges ruling regarding the preliminary injunction and received expedited treatment in the 8th Circuit Court of Appeals with a hearing to be set during the month of June
· Bills have been introduced with bi-partisan support in both the U.S. House of Representatives and Senate that seek a delay of the implementation of the Durbin Amendement while a study is conducted
12.) Wholesale Loan Growth 12%*
($ millions)
|
|
Diverse Products and Geographies |
|
|
|
|
|
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Commercial Lending |
|
$ |
3,116 |
|
$ |
3,491 |
|
$ |
3,719 |
|
$ |
3,646 |
|
$ |
3,609 |
| |
Leasing and Equipment Finance |
|
2,104 |
|
2,486 |
|
3,071 |
|
3,155 |
|
3,080 |
| ||||||
Inventory Finance |
|
|
|
5 |
|
469 |
|
792 |
|
1,011 |
| ||||||
Total |
|
$ |
5,220 |
|
$ |
5,982 |
|
$ |
7,259 |
|
$ |
7,593 |
|
$ |
7,700 |
| |
* Five-year compound annual growth rate
13.) Leasing & Equipment Finance 1
($ millions)
|
|
1Q11 Originations up 16% from 1Q10 |
|
|
|
|
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Leasing and Equipment Finance |
|
$ |
2,175 |
|
$ |
2,545 |
|
$ |
3,177 |
|
$ |
3,232 |
|
$ |
3,146 |
|
At March 31, 2011
· 13th largest bank-affiliated leasing company and 29th largest equipment finance/leasing company in the U.S.
· Diverse equipment types
· 20% specialty vehicles, 17% manufacturing, 14% medical, 11% construction
· 6.10% average yield
· Government stimulus of 100% year-one depreciation creates volume and spread opportunities
· Over 60-day delinquency rate .20% 2
· Net charge-offs: |
|
2011 |
|
2010 |
|
2009 |
|
|
|
.36% 3 |
|
1.00% |
|
.97% |
|
· Uninstalled backlog of $429.6 million
· Unguaranteed residuals of only $105.9 million, or 5.0% of leases
1 Includes operating leases ($65.6 million at March 31, 2011)
2 Excludes non-accrual loans and leases and acquired portfolios
3 Annualized
14.) TCF Inventory Finance
($ millions)
|
|
Strong Traction in Multiple |
|
|
|
|
| ||||||
|
|
Origination Segments |
|
|
|
|
| ||||||
|
|
|
|
|
|
|
|
|
| ||||
|
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Lawn & Garden |
|
$ |
|
|
$ |
347 |
|
$ |
442 |
|
$ |
710 |
|
PowerSports & Other |
|
|
|
|
|
221 |
|
194 |
| ||||
Electronics & Appliances |
|
4 |
|
122 |
|
129 |
|
107 |
| ||||
Total |
|
$ |
4 |
|
$ |
469 |
|
$ |
792 |
|
$ |
1,011 |
|
At March 31, 2011
· Inventory floorplan finance business with a focus on lawn and garden products, consumer electronics and appliances, and power sports
· Experienced and seasoned management
· Operates in the U.S. and Canada
· 239 employees
· 100% variable rate receivables
· Average yield 7.12%
· Net charge-offs: |
|
2011 |
|
2010 |
|
|
|
.40% 1 |
|
.17% |
|
· Credit support from equipment manufacturers
· Credit risk spread across more than 8,900 active dealers
1 Annualized
15.) Commercial Lending
($ millions)
|
|
Secured Lending Philosophy |
|
|
|
|
|
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Commercial Real Estate |
|
$ |
2,558 |
|
$ |
2,984 |
|
$ |
3,269 |
|
$ |
3,328 |
|
$ |
3,300 |
| |
Commercial Business |
|
558 |
|
507 |
|
450 |
|
318 |
|
309 |
| ||||||
Total |
|
$ |
3,116 |
|
$ |
3,491 |
|
$ |
3,719 |
|
$ |
3,646 |
|
$ |
3,609 |
| |
At March 31, 2011
· Commercial real estate $3.3 billion
· 26% retail services
· 25% apartment loans
· 18% office buildings
· 13% industrial buildings
· 7% hotels and motels
· Commercial business $309 million
· Commercial highlights
· 5.56% average yield
· 85% fixed rate, 15% variable rate
· Over 60-day delinquency rate .05% 1
· Net charge-offs: |
|
2011 |
|
2010 |
|
2009 |
|
|
|
1.39% 2 |
|
1.31% |
|
1.24% |
|
· Non-accrual loans decreased $14.5 million during 1Q11
· Approximately 99% of all commercial loans secured
· CRE location mix: 92% TCF banking markets, 8% other
1 Excludes non-accrual loans
2 Annualized
16.) Wholesale Banking1 Credit Quality
($ millions)
|
|
9/10 |
|
12/10 |
|
3/11 |
| |||
|
|
|
|
|
|
|
| |||
Performing loans and leases: |
|
|
|
|
|
|
| |||
Non-classified |
|
$ |
6,979 |
|
$ |
6,950 |
|
$ |
7,061 |
|
Classified 2 |
|
418 |
|
396 |
|
446 |
| |||
Subtotal performing |
|
7,397 |
|
7,346 |
|
7,507 |
| |||
60+ days delinquent and accruing 3 |
|
11 |
|
20 |
|
12 |
| |||
Accruing TDRs 4 |
|
5 |
|
49 |
|
17 |
| |||
Non-accrual loans and leases |
|
203 |
|
178 |
|
164 |
| |||
Total loans and leases |
|
$ |
7,616 |
|
$ |
7,593 |
|
$ |
7,700 |
|
Net charge-offs |
|
$ |
22 |
|
$ |
27 |
|
$ |
21 |
|
1 Includes commercial banking and specialty finance
2 Excludes classified loans and leases that are 60+ days delinquent or accruing TDRs
3 Excludes accruing TDRs that are 60+ days delinquent
4 No over 60-day delinquencies as of March 31, 2011
17.) Consumer Real Estate
($ millions)
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Fixed-rate |
|
$ |
5,481 |
|
$ |
5,487 |
|
$ |
5,332 |
|
$ |
4,793 |
|
$ |
4,687 |
|
Variable-rate |
|
1,570 |
|
1,815 |
|
1,949 |
|
2,363 |
|
2,375 |
| |||||
Total |
|
$ |
7,051 |
|
$ |
7,302 |
|
$ |
7,281 |
|
$ |
7,156 |
|
$ |
7,062 |
|
Balances of Loans Originated Since 1/1/09 |
|
|
|
$ |
|
|
$ |
857 |
|
$ |
1,442 |
|
$ |
1,530 |
|
At March 31, 2011
· 74% first mortgage lien positions, average loan amount of $122,716
· 26% junior lien positions, average loan amount of $40,578
· 66% fixed-rate, 34% variable-rate
· Average home value of $255,636 1
· 5.83% average yield
· Over 60-day delinquency rate of 1.30% 2; down for 3rd consecutive quarter
· Net charge-offs: |
|
2011 |
|
2010 |
|
2009 |
|
|
|
1.99% 3 |
|
1.80% |
|
1.46% |
|
· Average FICO score of the retail lending operation:
At origination 726
Updated 1Q11 724
· $2.2 billion of loans originated since January 1, 2009 has improved credit quality metrics (2011 net charge-offs of .06% 3 ) and has increased the composition of variable-rate loans in the portfolio
· 82% of retail lending loans have never been delinquent
1 Based on value at origination
2 Excludes non-accrual loans
3 Annualized
18.) Consumer Credit Quality
($ millions)
|
|
9/10 |
|
12/10 |
|
3/11 |
| |||
Performing loans |
|
$ |
6,713 |
|
$ |
6,613 |
|
$ |
6,533 |
|
60+ days delinquent and accruing 1 |
|
84 |
|
77 |
|
67 |
| |||
Accruing TDRs |
|
316 |
|
337 |
|
342 |
| |||
Non-accrual loans and leases |
|
167 |
|
168 |
|
155 |
| |||
Total loans |
|
$ |
7,280 |
|
$ |
7,195 |
|
$ |
7,097 |
|
Net charge-offs |
|
$ |
36 |
|
$ |
38 |
|
$ |
35 |
|
% of total past due with a recent payment 2 |
|
28.0 |
% |
28.0 |
% |
29.2 |
% |
1 Excludes accruing TDRs that are 60+ days delinquent
2 Retail lending accruing loans over 30-days delinquent that made a payment during the last month of the period
19.) Consumer Real Estate TDRs
· Loans modified to assist customers with their financial hardship by lowering their monthly loan payments for up to 18 months
· At March 31, 2011, TCF held $342 million of modified consumer real estate loans that are considered TDRs and continue to accrue interest, a net increase of $4.6 million, or 1.4% from December 31, 2010 (lowest quarter-over-quarter growth rate since the program was announced in August 2009)
· Reserved for based on present value of expected cash flows - $40.4 million, or 11.8% at March 31, 2011
· The over 60-day delinquency rate was 6.5% at March 31, 2011, up from 5.3% at December 31, 2010
· TCFs current modification program started in August 2009 and represents 76.9% of the March 31, 2011 balance of accruing TDRs
20.) Loan & Lease Geographic Diversification
($000s)
At Mar. 31, 2011: |
|
Consumer |
|
Commercial |
|
Leasing and |
|
Inventory |
|
Total |
| |||||
Minnesota |
|
$ |
2,791,925 |
|
$ |
875,824 |
|
$ |
83,484 |
|
$ |
25,946 |
|
$ |
3,777,179 |
|
Illinois |
|
2,150,316 |
|
882,296 |
|
102,335 |
|
34,438 |
|
3,169,385 |
| |||||
Michigan |
|
1,005,659 |
|
731,307 |
|
115,011 |
|
32,165 |
|
1,884,142 |
| |||||
Wisconsin |
|
466,621 |
|
571,451 |
|
54,022 |
|
30,536 |
|
1,122,630 |
| |||||
Colorado |
|
565,656 |
|
139,065 |
|
42,040 |
|
8,144 |
|
754,905 |
| |||||
California |
|
4,031 |
|
17,993 |
|
385,652 |
|
20,961 |
|
428,637 |
| |||||
Texas |
|
2,675 |
|
2,741 |
|
242,393 |
|
52,509 |
|
300,318 |
| |||||
Florida |
|
5,045 |
|
60,688 |
|
173,354 |
|
39,922 |
|
279,009 |
| |||||
Ohio |
|
3,303 |
|
54,268 |
|
131,002 |
|
52,202 |
|
240,775 |
| |||||
New York |
|
3,777 |
|
531 |
|
164,875 |
|
40,201 |
|
209,384 |
| |||||
Indiana |
|
24,202 |
|
79,622 |
|
60,822 |
|
32,624 |
|
197,270 |
| |||||
Canada |
|
|
|
|
|
4,041 |
|
174,353 |
|
178,394 |
| |||||
Arizona |
|
52,076 |
|
34,130 |
|
71,164 |
|
5,006 |
|
162,376 |
| |||||
Other |
|
21,889 |
|
158,440 |
|
1,449,771 |
|
462,037 |
|
2,092,137 |
| |||||
Total |
|
$ |
7,097,175 |
|
$ |
3,608,356 |
|
$ |
3,079,966 |
|
$ |
1,011,044 |
|
$ |
14,796,541 |
|
21.) Allowance for Loan & Lease Losses
($ millions)
|
|
12/07 |
|
12/08 |
|
12/09 |
|
12/10 |
|
3/11 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Allowance for Loan & Lease Losses |
|
$ |
80.9 |
|
$ |
172.4 |
|
$ |
244.5 |
|
$ |
265.8 |
|
$ |
255.3 |
|
Net Charge-offs |
|
.29 |
% |
.78 |
% |
1.34 |
% |
1.47 |
% |
1.51 |
% 1 | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Allowance as a % of period end loans & leases: |
|
.65 |
% |
1.29 |
% |
1.68 |
% |
1.80 |
% |
1.73 |
% | |||||
Ratio of allowance to net charge-offs: |
|
2.3 |
X |
1.7 |
X |
1.3 |
X |
1.2 |
X |
1.1 |
X | |||||
1 Annualized
22.) Credit Trends
(Percent)
|
|
Improving Trends Across All 3 Metrics |
|
|
|
|
|
|
|
|
|
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
6/09 |
|
9/09 |
|
12/09 |
|
3/10 |
|
6/10 |
|
9/10 |
|
12/10 |
|
3/11 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Non-Accrual Loans and Leases |
|
1.72 |
% |
1.88 |
% |
2.03 |
% |
2.08 |
% |
2.26 |
% |
2.48 |
% |
2.33 |
% |
2.16 |
% | |
Net Charge-offs 1 |
|
1.43 |
% |
1.52 |
% |
1.35 |
% |
1.22 |
% |
1.30 |
% |
1.58 |
% |
1.75 |
% |
1.51 |
% | |
Over 60-day Delinquencies 2 |
|
.72 |
% |
.81 |
% |
.69 |
% |
.82 |
% |
.87 |
% |
.78 |
% |
.79 |
% |
.69 |
% | |
1 Annualized
2 Excludes acquired portfolios
23.) Non-Accrual Loans & Leases
($ millions)
|
|
Inflows of New Non-Accruals is Slowing |
|
|
|
|
|
|
| |||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
|
Consumer |
|
Commercial |
|
Leasing and |
|
Inventory |
|
Total |
| |||||
Balance at September 30, 2010 |
|
$ |
166.6 |
|
$ |
161.9 |
|
$ |
40.4 |
|
$ |
.9 |
|
$ |
369.8 |
|
Inflows |
|
61.0 |
|
18.3 |
|
11.2 |
|
1.6 |
|
92.1 |
1 | |||||
Outflows |
|
(60.1 |
) |
(37.9 |
) |
(17.2 |
) |
(1.4 |
) |
(116.6 |
) | |||||
Net Change |
|
.9 |
|
(19.6 |
) |
(6.0 |
) |
.2 |
|
(24.5 |
) | |||||
Balance at December 31, 2010 |
|
$ |
167.5 |
|
$ |
142.3 |
|
$ |
34.4 |
|
$ |
1.1 |
|
$ |
345.3 |
|
Inflows |
|
58.4 |
|
7.6 |
|
10.8 |
|
3.8 |
|
80.6 |
2 | |||||
Outflows |
|
(70.7 |
) |
(22.1 |
) |
(10.6 |
) |
(3.5 |
) |
(106.9 |
) | |||||
Net Change |
|
(12.3 |
) |
(14.5 |
) |
.2 |
|
.3 |
|
(26.3 |
) | |||||
Balance at March 31, 2011 |
|
$ |
155.2 |
|
$ |
127.8 |
|
$ |
34.6 |
|
$ |
1.4 |
|
$ |
319.0 |
|
Combined two quarter net change |
|
$ |
(11.4 |
) |
$ |
(34.1 |
) |
$ |
(5.8 |
) |
$ |
.5 |
|
$ |
(50.8 |
) |
1 Down 36.0% from 3Q10 inflows of $143.9 million
2 Down 12.6% from 4Q10 inflows of $92.1 million; lowest since 2Q08
24.) Summary of Non-Accrual Loans
($ millions)
At Mar. 31, 2011: |
|
Contractual |
|
Charge-offs and |
|
Net |
|
Impairment 1 |
| |||
|
|
|
|
|
|
|
|
|
| |||
Consumer |
|
$ |
203.6 |
|
$ |
49.8 |
|
$ |
153.8 |
|
24.5 |
% |
Commercial |
|
187.5 |
|
75.9 |
|
111.6 |
|
40.5 |
| |||
Leasing and equipment finance |
|
34.6 |
|
8.2 |
|
26.4 |
|
23.6 |
| |||
Inventory finance |
|
1.4 |
|
.1 |
|
1.3 |
|
7.1 |
| |||
Total |
|
$ |
427.1 |
|
$ |
134.0 |
|
$ |
293.1 |
|
31.4 |
|
1 Represents the ratio of charge-offs and allowance recorded to the contractual loan balances prior to non-accrual status
25.) Summary of Real Estate Owned
($ millions)
At Mar. 31, 2011: |
|
Contractual Loan |
|
Charge-offs and |
|
Other Real Estate |
|
Impairment 1 |
| |||
|
|
|
|
|
|
|
|
|
| |||
Consumer |
|
$ |
144.5 |
|
$ |
46.5 |
|
$ |
98.0 |
|
32.2 |
% |
Commercial |
|
58.5 |
|
14.3 |
|
44.2 |
|
24.5 |
| |||
Total |
|
$ |
203.0 |
|
$ |
60.8 |
|
$ |
142.2 |
|
30.0 |
|
1 Represents the ratio of charge-offs and writedowns recorded to the contractual loan balances prior to non-performing status
26.) Real Estate Owned
($ millions)
|
|
Good Activity Levels Related to Sales and |
|
| ||||||
|
|
|
|
|
|
|
| |||
|
|
Consumer |
|
Commercial |
|
Total |
| |||
Balance at September 30, 2010 |
|
$ |
88.3 |
|
$ |
47.8 |
|
$ |
136.1 |
|
Inflows |
|
32.0 |
|
12.5 |
|
44.5 |
| |||
Outflows |
|
(30.2 |
) |
(9.3 |
) |
(39.5 |
) | |||
Net Change |
|
1.8 |
|
3.2 |
|
5.0 |
| |||
Balance at December 31, 2010 |
|
$ |
90.1 |
|
$ |
51.0 |
|
$ |
141.1 |
|
Inflows |
|
33.1 |
|
2.4 |
|
35.5 |
| |||
Outflows |
|
(25.2 |
) |
(9.2 |
) |
(34.4 |
) | |||
Net Change |
|
7.9 |
|
(6.8 |
) |
1.1 |
| |||
Balance at March 31, 2011 |
|
$ |
98.0 |
|
$ |
44.2 |
|
$ |
142.2 |
|
27.) Well-Positioned for Future Success
· Experienced and tenured management teams bold and innovative approach takes advantage of marketplace opportunities created by the current environment
· New industry approach of diverse portfolio lending funded with low-cost core retail deposits has been a part of TCFs business philosophy for many years
· Current management structure (Wholesale, Retail and Treasury & Support Services) has improved execution, reduces overhead and increased ability to quickly react to the current environment
· Strong wholesale banking management team positions us for profitable growth
28.) Cautionary Statement
This presentation 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, TCFs 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. TCFs future results may differ materially from historical performance and forward-looking statements about TCFs expected financial results or other plans and are subject to a number of risks and uncertainties. These include, but are not limited to the following:
* Adverse Economic or Business Conditions, Credit and Other Risks. Continued or deepening deterioration in general economic and banking industry conditions, or continued increases in unemployment in TCFs primary banking markets; adverse economic, business and competitive developments such as shrinking interest margins, deposit outflows, deposit account attrition, or an inability to increase the number of deposit accounts; adverse changes in credit and other risks posed by TCFs loan, lease, investment, and securities available for sale portfolios, including continuing declines in commercial or residential real estate values or changes in the allowance for loan and lease losses dictated by new market conditions or regulatory requirements; interest rate risks resulting from fluctuations in prevailing interest rates or other factors that result in a mismatch between yields earned on TCFs interest-earning assets and the rates paid on its deposits and borrowings; foreign currency exchange risks.
* Earnings/Capital Constraints, Liquidity Risks. Limitations on TCFs ability to pay dividends or to increase dividends in the future because of financial performance deterioration, regulatory restrictions or limitations; increased deposit insurance premiums, special assessments or other costs related to adverse conditions in the banking industry, the economic impact on banks of the Dodd-Frank Act, and other regulatory reform legislation; the impact of financial regulatory reform, including the phase out of trust preferred securities in tier 1 capital called for by the Dodd-Frank Act, or additional capital, leverage, liquidity and risk management requirements or changes in the composition of qualifying regulatory capital; adverse changes in securities markets directly or indirectly affecting TCFs ability to sell assets or to fund its operations; diminished unsecured borrowing capacity resulting from TCF credit rating downgrades and unfavorable conditions in the credit markets that restrict or limit various funding sources; possible regulatory and other changes to the Federal Home Loan Bank System that may affect TCFs borrowing capacity; costs associated with new regulatory requirements or interpretive guidance relating to liquidity.
* Legislative and Regulatory Requirements. New consumer protection and supervisory requirements, including the Dodd-Frank Acts creation of a new Bureau of Consumer Financial Protection and limits on Federal preemption for state laws that could be applied to national banks; the imposition of requirements with an adverse impact relating to TCFs lending, loan collection and other business activities as a result of the Dodd-Frank Act, or other legislative or regulatory developments such as mortgage foreclosure moratorium laws or imposition of underwriting or other limitations that impact the ability to use certain variable-rate products; reduction of interchange revenue from debit card transactions resulting from the so-called Durbin Amendment to the Dodd-Frank Act, which limits debit card interchange fees to amounts that will only allow issuers to recover incremental costs of authorization, clearance and settlement of debit card transactions, (continued)
29.) Cautionary Statement (continued)
plus possibly some costs relating to fraud prevention; impact of legislative, regulatory or other changes affecting customer account charges and fee income; changes to bankruptcy laws which would result in the loss of all or part of TCFs security interest due to collateral value declines (so-called cramdown provisions); any material failure of TCF to comply with the terms of its consent order with the Office of the Comptroller of the Currency relating to TCFs Bank Secrecy Act compliance, which may result in regulatory enforcement action including monetary penalties; increased health care costs resulting from recently enacted Federal health care reform legislation; adverse regulatory examinations and resulting enforcement actions or other adverse consequences such as increased capital requirements or higher deposit insurance assessments; heightened regulatory practices, requirements or expectations, including, but not limited to, requirements related to the Bank Secrecy Act and anti-money laundering compliance activity.
* Other Risks Relating to Fee Income. Future effects on fee income following TCFs implementation of regulatory requirements that prohibit financial institutions from charging overdraft fees on point-of-sale and ATM transactions unless customers opt-in, including customer opt-in preferences which may have an adverse impact on TCFs fee revenue; and uncertainties relating to future retail deposit account changes such as charging a daily negative balance fee in lieu of per item overdraft fees or other significant changes, including limitations on TCFs ability to predict customer behavior and the impact on TCFs fee revenues.
* Litigation Risks. Results of litigation, including class action litigation concerning TCFs lending or deposit activities including account servicing processes or fees or charges, or employment practices, and possible increases in indemnification obligations for certain litigation against Visa U.S.A. (covered litigation) and potential reductions in card revenues resulting from covered litigation or other litigation against Visa.
* Competitive Conditions; Supermarket Branching Risk. Reduced demand for financial services and loan and lease products; adverse developments affecting TCFs supermarket banking relationships or any of the supermarket chains in which TCF maintains supermarket branches.
* Accounting, Audit, Tax and Insurance Matters. Changes in accounting standards or interpretations of existing standards; federal or state monetary, fiscal or tax policies, including adoption of state legislation that would increase state taxes; adverse state or Federal tax assessments or findings in tax audits; lack of or inadequate insurance coverage for claims against TCF.
* Technological and Operational Matters. Technological, computer-related or operational difficulties or loss or theft of information and the possibility that deposit account losses (fraudulent checks, etc.) may increase.
Investors should consult TCFs Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K for additional important information about the Company.
30.) Reconciliation of GAAP to Non-GAAP Measures - Tangible Realized Common Equity 1
($000s)
|
|
March 31, 2011 | ||
Computation of total equity to total assets: |
|
|
| |
Total equity |
|
$ |
1,724,484 |
|
Total assets |
|
$ |
18,712,149 |
|
Total equity to total assets |
|
9.22 |
% | |
|
|
|
| |
Computation of tangible realized common equity to tangible assets: |
|
|
| |
Total equity |
|
$ |
1,724,484 |
|
Less: Non-controlling interest in subsidiaries |
|
16,540 |
| |
Total TCF stockholders equity |
|
1,707,944 |
| |
Less: |
|
|
| |
Goodwill |
|
152,599 |
| |
Other intangibles |
|
1,189 |
| |
Add: |
|
|
| |
Accumulated other comprehensive loss |
|
44,172 |
| |
Tangible realized common equity |
|
$ |
1,598,328 |
|
|
|
|
| |
Total assets |
|
$ |
18,712,149 |
|
Less: |
|
|
| |
Goodwill |
|
152,599 |
| |
Other intangibles |
|
1,189 |
| |
Tangible assets |
|
$ |
18,558,361 |
|
|
|
|
| |
Tangible realized common equity to tangible assets |
|
8.61 |
% |
1 In contrast to GAAP-basis measures, tangible realized common equity excludes the effect of goodwill, other intangibles and accumulated other comprehensive income (loss). Management reviews tangible realized common equity as an ongoing measure and has included this information because of current interest in the industry. The methodology for calculating tangible realized common equity may vary between companies.
31.) Reconciliation of GAAP to Non-GAAP Measures - Total Tier 1 Common Capital Ratio 1
($000s)
|
|
Dec. 31, 2007 |
|
Dec. 31, 2008 |
|
Dec. 31, 2009 |
|
Dec. 31, 2010 |
|
Mar. 31, 2011 | ||||||||||
Total Tier 1 risk-based capital ratio: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total tier 1 capital |
|
$ |
964,467 |
|
|
$ |
1,461,973 |
|
|
$ |
1,161,750 |
|
|
$ |
1,475,525 |
|
|
$ |
1,732,554 |
|
Total risk-weighted assets |
|
$ |
11,648,286 |
|
|
$ |
12,401,467 |
|
|
$ |
13,627,871 |
|
|
$ |
13,929,097 |
|
|
$ |
13,961,754 |
|
Total tier 1 risk-based capital ratio |
|
8.28 |
% |
|
11.79 |
% |
|
8.52 |
% |
|
10.59 |
% |
|
12.41 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Computation of tier 1 common capital ratio: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total tier 1 capital |
|
$ |
964,467 |
|
|
$ |
1,461,973 |
|
|
$ |
1,161,750 |
|
|
$ |
1,475,525 |
|
|
$ |
1,732,554 |
|
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Qualifying trust preferred securities |
|
|
|
|
115,000 |
|
|
115,000 |
|
|
115,000 |
|
|
115,000 |
| |||||
Qualifying non-controlling interest in subsidiaries |
|
|
|
|
|
|
|
4,393 |
|
|
8,500 |
|
|
16,450 |
| |||||
Preferred stock |
|
|
|
|
348,437 |
|
|
|
|
|
|
|
|
|
| |||||
Total tier 1 common capital |
|
$ |
964,467 |
|
|
$ |
998,536 |
|
|
$ |
1,042,357 |
|
|
$ |
1,352,025 |
|
|
$ |
1,601,104 |
|
Total risk-weighted assets |
|
$ |
11,648,286 |
|
|
$ |
12,401,467 |
|
|
$ |
13,627,871 |
|
|
$ |
13,929,097 |
|
|
$ |
13,961,754 |
|
Total tier 1 common capital ratio |
|
8.28 |
% |
|
8.05 |
% |
|
7.65 |
% |
|
9.71 |
% |
|
11.47 |
% |
1 In contrast to GAAP-basis measures, the total tier 1 common capital ratio excludes the effect of qualifying trust preferred securities and qualifying non-controlling interest in subsidiaries. Management reviews the total tier 1 common capital ratio as an ongoing measure and has included this information because of current interest in the industry. The methodology for calculating total tier 1 common capital may vary between companies.
32.) Source References & Footnotes
Slide: Corporate Profile
32nd largest publicly-traded U.S. based bank holding company - SNL Financial, LC; 12/31/10
25th largest branch network - SNL Financial, LC; 1Q11
5th largest in campus card relationships - CR80News; Spring 2010
11th largest issuer of Visa Classic - Visa; 4Q10; ranked by sales volume
12th largest issuer of Visa Commercial - Visa; 4Q10; ranked by sales volume
13th largest bank affiliated leasing company - The Monitor; 2010 Monitor 100
Slide: Diversified Revenue Base
KBW Regional Banking Index net interest margin data - KBW & SNL Financial LC; 12/31/10
Slide: Card Revenue
11th largest issuer of Visa Classic - Visa; 4Q10; ranked by sales volume
12th largest issuer of Visa Commercial - Visa; 4Q10; ranked by sales volume
Slide: Leasing and Equipment Finance
13th largest bank-affiliated leasing company - The Monitor; 2010 Monitor Bank 40
29th largest equipment finance/leasing company - The Monitor; 2010 Monitor 100