TCF Bank 2015 Annual Report Download - page 55

Download and view the complete annual report

Please find page 55 of the 2015 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 144

  • 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
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144

40
Loan Credit Classifications TCF assesses the risk of its loan and lease portfolio utilizing numerous risk characteristics
as outlined in the previous sections. The loan credit classifications represent an additional characteristic that is closely
monitored in the overall credit risk process. The loan credit classifications derived from standard regulatory rating
definitions include: accruing non-classified (pass and special mention) and accruing classified (substandard and
doubtful). Accruing classified loans and leases have well-defined weaknesses, but may never become non-accrual or
result in a loss.
The following tables summarize accruing loans and leases by portfolio and regulatory classification and non-accrual
loans and leases by portfolio.
At December 31, 2015
Accruing Non-classified Accruing Classified Total
Accruing Total Non-
accrual Total Loans
and Leases
(Dollars in thousands) Pass Special Mention Substandard Doubtful
Consumer real estate $ 5,210,975 $ 62,722 $ 22,306 $ — $ 5,296,003 $ 168,269 $ 5,464,272
Commercial 3,035,320 65,382 34,805 — 3,135,507 10,325 3,145,832
Leasing and equipment
finance 3,969,191 19,806 11,989 — 4,000,986 11,262 4,012,248
Inventory finance 1,887,505 138,945 119,206 — 2,145,656 1,098 2,146,754
Auto finance 2,632,589 — 5,498 —2,638,087 9,509 2,647,596
Other 19,274 — 20 — 19,294 3 19,297
Total loans and leases $16,754,854 $ 286,855 $ 193,824 $ — $17,235,533 $ 200,466 $
17,435,999
Percent of total loans and
leases 96.1% 1.7% 1.1% —% 98.9% 1.1% 100.0%
At December 31, 2014
Accruing Non-classified Accruing Classified
Total Accruing Total Non-
accrual Total Loans
and Leases
(Dollars in thousands) Pass Special Mention Substandard Doubtful
Consumer real estate $ 5,395,103 $ 69,811 $ 44,179 $ — $ 5,509,093 $ 173,271 $ 5,682,364
Commercial 3,033,992 46,935 51,703 — 3,132,630 25,035 3,157,665
Leasing and equipment
finance 3,704,565 16,539 11,548 — 3,732,652 12,670 3,745,322
Inventory finance 1,661,701 90,413 122,894 — 1,875,008 2,082 1,877,090
Auto finance 1,906,740 — 4,645 —1,911,385 3,676 1,915,061
Other 24,136 8 — — 24,144 — 24,144
Total loans and leases $15,726,237 $ 223,706 $ 234,969 $ — $ 16,184,912 $ 216,734 $16,401,646
Percent of total loans and
leases 95.9% 1.4% 1.4% —% 98.7% 1.3% 100.0%
The combined balance of accruing classified loans and leases and non-accrual loans and leases was $394.3 million
at December 31, 2015, a decrease of $57.4 million from December 31, 2014, primarily due to a decrease of
substandard and non-accrual loans in the commercial and consumer real estate portfolios due to improved credit
quality trends and continued efforts to actively work out problem loans in the commercial portfolio.
Allowance for Loan and Lease Losses The determination of the allowance for loan and lease losses is a critical
accounting estimate. TCF's evaluation of incurred losses is based upon historical loss rates multiplied by the respective
portfolio's loss emergence period. Factors utilized in the determination of the amount of the allowance include historical
trends in loss rates, a portfolio's overall risk characteristics, changes in its character or size, risk rating migration,
delinquencies, collateral values and prevailing economic conditions. The various factors used in the methodologies
are reviewed on a periodic basis.