TCF Bank 2010 Annual Report Download - page 34

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• 18 • TCF Financial Corporation and Subsidiaries
Item 7. Management’s Discussion
and Analysis of Financial Condition
and Results of Operations
Table of Contents Page
Overview 18
Results of Operations 20
Performance Summary 20
Operating Segment Results 20
Consolidated Income Statement Analysis 20
Net Interest Income 20
Provision for Credit Losses 24
Non-Interest Income 24
Non-Interest Expense 26
Income Taxes 28
Consolidated Financial Condition Analysis 29
Securities Available for Sale 29
Loans and Leases 29
Allowance for Loan and Lease Losses 39
Other Real Estate Owned and Repossessed
and Returned Equipment 40
Liquidity Management 42
Deposits 42
Borrowings 42
Contractual Obligations and Commitments 43
Stockholders’ Equity 43
Summary of Critical Accounting Estimates 45
Recent Accounting Developments 46
Fourth Quarter Summary 46
Legislative, Legal and Regulatory Developments 47
Forward-Looking Information 47
Management’s discussion and analysis of the consolidated
financial condition and results of operations of TCF Financial
Corporation should be read in conjunction with the
consolidated financial statements in Item 8 and selected
financial data in Item 6.
Overview
TCF Financial Corporation, a Delaware corporation, is
a national bank holding company based in Wayzata,
Minnesota. Its principal subsidiary, TCF National Bank, is
headquartered in South Dakota. TCF had 442 branches in
Minnesota, Illinois, Michigan, Colorado, Wisconsin, Indiana,
Arizona and South Dakota (TCF’s primary banking markets)
at December 31, 2010.
TCF provides convenient financial services through
multiple channels in its primary banking markets. TCF has
developed products and services designed to meet the
needs of all consumers. The Company focuses on attracting
and retaining customers through service and convenience,
including branches that are open seven days a week and
on most holidays, extensive full-service supermarket
branches, automated teller machine (“ATM”) networks
and internet, mobile and telephone banking. TCF’s philoso-
phy is to generate interest income, fees and other revenue
growth through business lines that emphasize higher
yielding assets and low or no interest-cost deposits. The
Company’s growth strategies include the development
of new products and services, new branch expansion and
acquisitions. New products and services are designed to
build on existing businesses and expand into complemen-
tary products and services through strategic initiatives.
TCF’s core businesses include Retail Banking, Wholesale
Banking and Treasury Services. Retail Banking includes
branch banking and retail lending. Wholesale Banking
includes commercial banking, leasing and equipment
finance and inventory finance. TCF refers to its combined
leasing and equipment finance and inventory finance
businesses as Specialty Finance. Treasury Services includes
the Company’s investment and borrowing portfolios and
management of capital, debt and market risks, including
interest-rate and liquidity risks.
TCF’s lending strategy is to originate high credit quality
and primarily secured loans and leases. TCF’s retail lending
operation offers fixed- and variable-rate loans and lines
of credit secured by residential real estate properties.
Commercial loans are generally made on properties or to
customers located within TCF’s primary banking markets.
The leasing and equipment finance businesses consist of
TCF Equipment Finance, a company that delivers equipment
finance solutions to businesses in select markets, and
Winthrop Resources, a company that primarily leases
technology and data processing equipment. TCF’s leasing
and equipment finance businesses have equipment
installations in all 50 states and, to a limited extent, in
foreign countries. In December 2008, TCF Inventory Finance
commenced lending operations to originate commercial
variable-rate loans which are secured by equipment under
a floorplan arrangement and supported by repurchase
agreements from original equipment manufacturers to
businesses in the United States and Canada.