TCF Financial reported net income of $70.5 million for the first quarter of 2019, compared with $73.8 million for the first quarter of 2018 and $85.7 million for the fourth quarter of 2018. Diluted earnings per common share was 42 cents for the first quarter of 2019 (inclusive of a 4 cents per common share after-tax impact of merger-related expenses), compared with 39 cents for the first quarter of 2018 and 51 cents for the fourth quarter of 2018.

Adjusted diluted earnings per common share was 46 cents for the first quarter of 2019, an increase of 17.9% from the first quarter of 2018.

“Our strong first quarter performance was highlighted by higher return on capital compared to a year ago and disciplined expense management,” said Craig R. Dahl, TCF chairman and CEO. “Our results were supported by loan and lease growth excluding the run-off of our auto finance portfolio, and growth in core checking and savings deposit balances, while we controlled expense growth excluding merger-related expenses. We continue to see a positive business outlook for the year, with strong organic growth prospects across many of our businesses and we are well underway in integration planning work to prepare for our proposed merger of equals with Chemical Financial.”

Net interest income was $250.9 million for the first quarter of 2019, an increase of $7.7 million, or 3.2%, from the first quarter of 2018 and an increase of $2 million, or 0.8%, from the fourth quarter of 2018.

Net interest margin was 4.56% for the first quarter of 2019, down 3 basis points from the first quarter of 2018 and down 4 basis points from the fourth quarter of 2018.

The increase in net interest income from the first quarter of 2018 was primarily due to increased average yields and higher average balances in the variable- and adjustable-rate loan portfolios, higher average balances of fixed-rate consumer real estate loans and debt securities available for sale, partially offset by increased cost of funds and lower average balances of auto finance loans. The increase in net interest income from the fourth quarter of 2018 was primarily due to seasonally higher average balances of inventory finance loans and higher average balances of fixed-rate consumer real estate loans, partially offset by increased cost of funds and lower average balances of auto finance loans. The decreases in net interest margin from both periods were primarily due to higher average rates on deposits, partially offset by higher average yields on the variable- and adjustable-rate loan portfolios. The decreases were also driven by the reinvestment of the auto finance portfolio run-off into available for sale mortgage-backed debt securities and fixed-rate consumer real estate loans.

Non-interest income was $107 million for the first quarter of 2019, a decrease of $5.2 million, or 4.6%, from the first quarter of 2018 and a decrease of $21.1 million, or 16.5%, from the fourth quarter of 2018. The decrease from the first quarter of 2018 was primarily due to a decrease in servicing fee income driven by continued run-off in the auto finance serviced for others portfolio and a decrease in gains on sales of loans.

Average loans and leases were $19.2 billion for the first quarter of 2019, a decrease of $67.2 million, or 0.3%, from the first quarter of 2018 and an increase of $631.6 million, or 3.4%, from the fourth quarter of 2018. The decrease from the first quarter of 2018 was primarily due to run-off of the auto finance portfolio, partially offset by increases in the consumer real estate, inventory finance and commercial loan portfolios. The increase from the fourth quarter of 2018 was primarily due to increases in the inventory finance and consumer real estate loan portfolios, partially offset by run-off of the auto finance portfolio.

Average loans and leases excluding auto finance were $17.3 billion for the first quarter of 2019, an increase of $1.1 billion, or 6.8%, from the first quarter of 2018 and an increase of $912.5 million, or 5.6%, from the fourth quarter of 2018.