Investments in Affordable Housing Limited Liability Entities

12 Months Ended

Dec. 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Investments in affordable housing limited liability entities

Investments in Affordable Housing Limited Liability Entities

Investments in affordable housing limited liability entities and unfunded commitments were as follows:

	At December 31,
(In thousands)	2018		2017
Investments in affordable housing limited liability entities	$	90,871	$	82,399
Accrued expenses and other liabilities - unfunded commitments	56,167		48,973

Amortization expense with respect to TCF's investments in affordable housing limited liability entities was $9.9 million, $9.6 million and $4.8 million for 2018, 2017 and 2016, respectively, offset by tax credits and other benefits of $11.6 million, $12.5 million and $7.1 million, respectively. At December 31, 2018, the expected payments for unfunded affordable housing commitments will be payable in 2019 through 2033.

Investments in affordable housing limited liability entities are considered VIEs because TCF, as a limited partner, lacks the power to direct the activities that most significantly impact the entities' economic performance. TCF has concluded it is not the primary beneficiary of the investments in affordable housing limited liability entities and therefore, they are not consolidated. At December 31, 2018 and 2017, the carrying amount of the VIE investments was $90.9 million and $81.9 million, respectively. The maximum exposure to loss on the VIE investments was $91.1 million and $81.9 million at December 31, 2018 and 2017, respectively. The maximum exposure to loss on the VIE investments is limited to the carrying amount of the investments and the potential recapture of any recognized tax credits. TCF believes the likelihood of the tax credits being recaptured is remote, as a loss would require the managing entity to fail to meet certain government compliance requirements. Further, certain of TCF's investments in affordable housing limited liability entities include guaranteed minimum returns which are backed by an investment grade credit-rated company, which reduces the risk of loss.