Regulatory Capital Requirements

3 Months Ended

Mar. 31, 2020

Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract]

Regulatory Capital Requirements

Regulatory Capital Requirements

TCF and TCF Bank are subject to minimum capital requirements administered by the federal banking regulators. Failure to meet minimum capital requirements can initiate certain mandatory, and possible additional discretionary, actions by the federal banking regulators that could have a material adverse effect on TCF. In general, TCF Bank may not declare or pay a dividend to TCF in excess of 100% of its net retained earnings for the current year combined with its net retained earnings for the preceding two calendar years, which was $121.4 million at March 31, 2020, without prior approval of the Office of the Comptroller of the Currency ("OCC"). The OCC also has the authority to prohibit the payment of dividends by a national bank when it determines such payments would constitute an unsafe and unsound banking practice. TCF Bank's ability to make capital distributions in the future may require regulatory approval and may be restricted by its federal banking regulators. TCF Bank's ability to make any such distributions will also depend on its earnings and ability to meet minimum regulatory capital requirements in effect during future periods. In the future, these capital adequacy standards may be higher than existing minimum regulatory capital requirements.

The Basel III capital standards allowed institutions not subject to the advanced approaches requirements to opt out of including components of accumulated other comprehensive income (loss) in common equity Tier 1 capital. TCF and TCF Bank made the one-time permanent election to not include accumulated other comprehensive income (loss) in regulatory capital.

Effective January 1, 2020, the Corporation adopted CECL. In response to the COVID-19 pandemic, the regulatory agencies published an interim final rule on March 31, 2020 that provides the option to delay the cumulative effect of the day 1 impact of CECL adoption on regulatory capital, along with 25% of the change in the adjusted allowance for credit losses (as computed for regulatory capital purposes which excludes PCD loans), for two years, followed by a three-year phase-in period. Management elected the 5-year transition period consistent with the March 31, 2020 interim final rule.

Regulatory capital information for TCF and TCF Bank was as follows:

	TCF						TCF Bank
	At March 31,			At December 31,			At March 31,			At December 31,			Well-capitalized Standard		Minimum Capital Requirement(1)
(Dollars in thousands)	2020			2019			2020			2019
Regulatory Capital:
Common equity Tier 1 capital	$	4,026,304		$	4,050,826		$	4,035,278		$	4,039,191
Tier 1 capital	4,225,755			4,236,648			4,065,427			4,059,417
Total capital	4,744,899			4,681,630			4,565,533			4,524,051
Regulatory Capital Ratios:
Common equity Tier 1 capital ratio	10.44		%	10.99		%	10.48		%	10.97		%	6.50	%	4.50	%
Tier 1 risk-based capital ratio	10.96			11.49			10.56			11.03			8.00		6.00
Total risk-based capital ratio	12.31			12.70			11.86			12.29			10.00		8.00
Tier 1 leverage ratio	9.27			9.49			8.93			9.10			5.00		4.00

(1)

Excludes capital conservation buffer of 2.5% at both March 31, 2020 and December 31, 2019.