TCF Bank 2009 Annual Report Download - page 4

2 : TCF Financial Corporation and Subsidiaries
• TCF’s net interest margin was 3.87 percent for the full
year of 2009 and 4.07 percent in the fourth quarter of
2009. Our industry leading deposit strategies and the
reduction of high interest-rate certificates of deposit
balances in 2009 contributed significantly to net interest
margin. In addition, we continued to closely monitor
pricing on both our deposits and loans and leases in order
to stay competitive and yield the highest return. TCF’s net
interest margin continues to be better than the average
of the Top 50 Banks by approximately 66 basis points.
• To preserve capital in today’s market, TCF lowered
its annual dividend rate to $.20 per share in 2009. The
dividend reduction accelerates the accumulation of
retained earnings. In addition, it adds to our capital base
for future growth. Prudent capital management allowed
us to take advantage of growth opportunities to expand
our business without diluting our stockholder base. TCF
has paid dividends 87 consecutive quarters and returning
capital to our stockholders is an important part of how we
deliver value.
• TCF is financially strong and remains a safe and sound
bank. We are solidly capitalized and have ample liquidity
to conduct business. TCF’s Tier 1 risk-based capital was
$1.2 billion, or 8.52 percent of risk-weighted assets, and
total risk-based capital was $1.5 billion, or 11.12 percent
of risk-weighted assets. We continue to exceed
the well-capitalized requirements as defined by the
Federal Reserve Board. At December 31, 2009, TCF
had $152.1 million of excess total risk-based capital over
the stated well-capitalized requirement. TCF’s tangible
common equity ratio was 5.86 percent. TCF has access
to the capital markets to raise additional equity or debt
for future expansion.
• TCF reorganized its day-to-day operations by business
lines: Retail Banking (branch banking and retail lending),
Wholesale Banking (commercial banking, leasing and
equipment finance, and inventory finance), Treasury
Services and Support Services. Each business line has
its own profit center goals and objectives. We believe
the new organizational structure improves our already
highly responsive and performance-driven culture.
TCF Retail Banking:
TCF’s average core deposits, which include checking,
savings and money market deposits, totaled a record
$7.2 billion at December 31, 2009, up 37 percent from
last year. TCF does not have any brokered deposits.
Savings was our largest deposit growth category in 2009,
increasing 68 percent as a result of several initiatives on
product features, pricing, cross-selling and marketing that
were incorporated into our sales program. In addition, we
continued to aggressively market our checking account
products resulting in an astonishing 24 percent increase
in the number of new checking accounts opened in
2009. Our Free Cash premium and Tell-A-Friend campaign
were highly successful in attracting new customers to
TCF, thus allowing for additional cross-sell opportunities
and future fee income. Another key part of our deposit
strategy in 2009 was the designed runoff of high interest-
rate certificates of deposits, which reduced our cost
of funds and improved our net interest margin. We
will continue to focus our efforts on growing low-cost
deposits in 2010 and looking for new products and
premiums to introduce into the market.
In 2010, we will once again keep our organic branch
expansion plans to a minimum unless opportunities arise
with our two supermarket partners. We will continue to
evaluate positively accretive acquisition transactions or an
0908070605
$2.09
$1.01
$.54
Diluted Earnings
Per Common Share
Dollars
Diluted EPS
Dividends Paid
$1.97
$1.86
0908070605
$1,246
Risk-Based Capital
Millions of Dollars
TARP
Total Risk-Based Capital
Well Capitalized Requirement
$1,050
$1,173
$1,515
$1,817