TCF Bank 2004 Annual Report Download - page 62

Download and view the complete annual report

Please find page 62 of the 2004 TCF Bank annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 88

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88

60 TCF Financial Corporation and Subsidiaries
Note 9. Goodwill and Other Intangible Assets
Goodwill and other intangible assets are summarized as follows:
At December 31,
2004 2003
Gross Accumulated Net Gross Accumulated Net
(In thousands) Amount Amortization Amount Amount Amortization Amount
Amortizable intangible assets:
Mortgage servicing rights . . . . . . . . . . . . . . $ 83,668 $ 37,226 $ 46,442 $ 76,306 $ 24,270 $ 52,036
Deposit base intangibles . . . . . . . . . . . . . . 21,180 16,935 4,245 21,180 15,273 5,907
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $104,848 $ 54,161 $ 50,687 $ 97,486 $ 39,543 $ 57,943
Unamortizable intangible assets:
Goodwill included in Banking Segment . . . . $145,462 $145,462 $145,462 $145,462
Goodwill included in Leasing Segment . . . . 7,137 7,137 – –
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $152,599 $152,599 $145,462 $145,462
Amortization expense for intangible assets was $14.8 million, $25.3 million and $24.5 million for the years ended December 31, 2004, 2003 and
2002, respectively. The following table shows the estimated future amortization expense for amortized intangible assets based on existing asset
balances and the interest rate environment as of December 31, 2004. The Company’s actual amortization expense in any given period may be
significantly different from the estimated amounts depending upon the addition of new intangible assets, changes in mortgage interest rates,
prepayment rates and other market conditions.
(In thousands) Mortgage Deposit Base
Estimated Amortization Expense for the Year Ended December 31,: Servicing Rights Intangibles Total
2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $11,693 $ 1,659 $13,352
2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,387 1,631 11,018
2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,317 955 8,272
2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,687 – 5,687
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,440 – 4,440
Note 10. Mortgage Banking
The activity in mortgage servicing rights and the related valuation allowance is summarized as follows:
Year Ended December 31,
(In thousands) 2004 2003 2002
Mortgage servicing rights at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 54,036 $ 71,990 $ 63,607
Wholesale originations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,038 21,385 30,781
Retail originations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,959 12,840 8,976
Amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (13,091) (23,679) (22,874)
Impairment write-down . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . –(28,500) (8,500)
Mortgage servicing rights at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,942 54,036 71,990
Valuation allowance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,000) (9,346) (5,346)
Provision for impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,500) (21,154) (12,500)
Impairment write-down . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . –28,500 8,500
Valuation allowance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,500) (2,000) (9,346)
Mortgage servicing rights, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 46,442 $ 52,036 $ 62,644