TCF Bank 2001 Annual Report Download - page 63

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14 Stockholders’ Equity
RESTRICTED RETAINED EARNINGS – Retained earnings at
December 31, 2001 includes approximately $134.4 million for which
no provision for federal income tax has been made. This amount
represents earnings appropriated to bad debt reserves and deducted
for federal income tax purposes and is generally not available for pay-
ment of cash dividends or other distributions to shareholders.
Payments or distributions of these appropriated earnings could invoke
a tax liability for TCF based on the amount of earnings removed and
current tax rates.
In general, TCF’s subsidiary banks may not declare or pay a div-
idend to TCF in excess of 100% of their net profits for that year com-
bined with their retained net profits for the preceding two calendar
years without prior approval of the Office of the Comptroller of the
Currency (“OCC”). Additional limitations on dividends declared
or paid on, or repurchases of, TCF’s subsidiary banks’ capital stock
are tied to the national banks’ regulatory capital levels.
SHAREHOLDER RIGHTS PLAN – TCF’s preferred share pur-
chase rights will become exercisable only if a person or group acquires
or announces an offer to acquire 15% or more of TCF’s common
stock. When exercisable, each right will entitle the holder to buy one
one-hundredth of a share of a new series of junior participating pre-
ferred stock at a price of $100. In addition, upon the occurrence of
certain events, holders of the rights will be entitled to purchase either
TCF’s common stock or shares in an “acquiring entity” at half of the
market value. TCF’s Board of Directors (the “Board”) is generally
entitled to redeem the rights at one cent per right at any time before
they become exercisable. The rights will expire on June 9, 2009, if
not previously redeemed or exercised.
The significant components of the Company’s deferred tax assets and deferred tax liabilities are as follows:
At December 31,
(In thousands) 2001 2000
Deferred tax assets:
Securities available for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ – $ 5,755
Allowance for loan and lease losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,829 20,471
Pension and other compensation plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,034 15,710
Total deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,863 41,936
Deferred tax liabilities:
Securities available for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,580 –
Lease financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53,158 50,653
Loan fees and discounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,596 12,570
Mortgage servicing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,912 2,884
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 399 4,240
Total deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,645 70,347
Net deferred tax assets (liabilities) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(41,782) $(28,411)
61
TREASURY STOCK AND OTHER – Treasury stock and other consists of the following:
At December 31,
(In thousands) 2001 2000
Treasury stock, at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(463,394) $(325,026)
Shares held in trust for deferred compensation plans, at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (71,652) (61,908)
Unamortized deferred compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (31,688) (33,056)
Loans to deferred compensation plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,783) (5,137)
$(576,517) $(425,127)