TCF Beats the Street; Q2 Equipment Finance Revenue Up 18% Y/Y

TCF Financial reported Q2/16 net income of $57.7 million was up 10.4% compared with net income of $52.3 million for Q2/15. Deluded earnings per common share was $0.31 compared with $0.29 for the second quarter of 2015. Analysts polled by Thomson Reuters expected Q2/16 EPS of $0.29.

The following highlights were excerpted from the news release:

  • Leasing and equipment finance revenue of $31.1 million was up 17.8% from $26.4 million a year earlier. Year-date-revenue through June 30, 2016 of $59.6 million was up 22.5% from $48.6 million for the same period a year earlier.
  • Period-end June 30, 2016 leasing and equipment finance assets of $4,120.4 million was up 8.7% from $3,791.2 million a year earlier.
  • The net interest margin for Q2/16 was 4.35%, down from 4.44% in the same quarter in 2015. TCF said the decrease was primarily due to higher rates paid on certificates of deposit and margin compression resulting from the impact of the ongoing low interest rate environment

“TCF had a strong second quarter as year-over-year revenue growth continued to outpace expense growth,” said Craig R. Dahl, president and CEO. “Operating leverage, one of TCF’s four strategic pillars, remained in focus during the quarter as we generated strong non-interest income from our national lending businesses while continuing to manage our overall expense base. Despite the ongoing headwinds from the rate environment, we managed to sustain our loan yields and manage our deposit costs during the quarter. Our diversification strategy continues to drive good outcomes with strong loan and lease originations taking place while maintaining stable credit quality across all business units.

“Our business results indicate true progress against our four strategic pillars: diversification, profitable growth, operating leverage and core funding. As we move to the second half of 2016 and beyond, the team at TCF is focused on improving the experience of our customer and accelerating value creation for our shareholders.”

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