TCF's Profits Double, Loans Rise 6%
TCF Financial in Wayzata, Minn., reported higher profits on lower provision costs and a pickup in lending in the fourth quarter.
The $20.7 billion-asset company earned $52.5 million, more than double its profits from a year earlier. Earnings per share were 29 cents, in line with an estimate of analysts polled by Bloomberg.
The provision for bad loans declined 68%, to $17.6 million. But other factors helped earnings, too.
MinnesotaOver the past three decades William Cooper has led TCF Financial through two crises and reinvented the bank to keep it profitable. He also sued the Federal Reserve in the aftermath of the financial crisis, for imposing a cap on debit card fees. For his strong leadership in the industry as well as his candid, off-the-cuff style American Banker has named him its lifetime achievement honoree.December 14
Banks have made changes to overdrafts, such as lowering fees offering clearer explanations. They better, as the CFPB will soon offer new rules for overdrafts. Plus, overdraft revenue has declined at many banks. Still unanswered is the question of how to offer short-term credit, if overdrafts disappear.January 5
Total loans rose 6% to $17.4 billion mostly from higher auto- and inventory-financing balances. Net interest income grew 27% to $188.1 million as a result, even though the net interest margin fell 14 basis points to 4.35%.
Fee-based income increased 5%, to $115.7 million, as an uptick in leasing revenue offset lower gains on the sale of auto loans.
Noninterest expenses held steady at $222.5 million.