TCF Financial Corporation (TCB) in Wayzata, Minn., missed analysts' first-quarter estimates as a service charges and fees declined.

The $18.5 billion-asset company said Friday it earned a quarterly profit of $25.5 million, after losing $283 in the first quarter of 2012 on a $296 million charge in that quarter. Per-share earnings of 16 shares were 3 cents below the consensus estimates of analysts polled by Bloomberg.

TCF's quarterly revenue declined 15%, to $291.8 million, as higher lending levels failed to make up for an erosion in income from banking fees and securities sales.

Noninterest income rose 4%, to $92.7 million, due in part to an $8.1 million sale of consumer real estate loans. Revenue from banking fees fell 7%, to $57.2 million, due to TCF's reintroduction of free checking and the elimination of a monthly deposit fee, it said. Revenue from leasing and equipment finance fell 28%, to $16.5 million.

TCF's net interest income rose 11%, to $199 million, as its net interest margin widened by 58 basis points, to 4.72%. Its cost of borrowing fell by $27 million due to a balance-sheet repositioning in the first quarter of 2012, it said.

TCF's lending rose in the quarter, but so did its nonperforming loans. Loans and leases rose 3%, to $15.6 billion, while nonaccrual loans rose 11%, to $343 million, due in part to a change in its bankruptcy-related procedures implemented in the third quarter of 2012. Provision for loan losses declined 21%, to $38.4 million, while net chargeoffs rose 5%, to $41 million.

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