Skinner, Sureka, Yan
1
Recap: Sector Weighting
S&P 500 Weight
SIM Weight
Consumer Discretionary
Consumer Staples
Consumer Discretionary
Consumer Staples
Energy
Financials
Energy
Financials
Health Care
Industrials
Health Care
Industrials
Information Technology
Materials
Information Technology
Materials
Telecommunication Services
Utilities
Telecommunication Services
Utilities
3%
3% 4%
4% 3%
8%
9%
5%
12%
12%
19%
20%
12%
12%
10%
9%
13%
15%
13%
14%
Financials are underweighted by 610 BPs
Skinner, Sureka, Yan
2
Recommendation for Sector
Increase SIM Holdings by 400BPs
 But, still keep it underweight relative to
S&P500
 We are bullish for long run and bearish
for short run
 Real Estate-Avoid; Regional Bankstrading at attractive multiples
 Regional Banks will benefit from long
term growth

Skinner, Sureka, Yan
3
Current Holdings in Financials
Stock
% of
sector
% of
portfolio
Berkshire Hathaway Inc.
(BRK/A)
24.1%
2.3%
Goldman Sachs Group Inc.
(GS)
10.4%
1.0%
Hudson City Bancorp Inc.
(HCBK)
17.5%
1.6%
JP Morgan Chase & Co.
(JPM)
20.4%
1.9%
Visa Inc. (V)
27.7%
2.6%
100%
9.4%
Total
Skinner, Sureka, Yan
4
Recommendations
Purchase 250 bps of TCB
 Purchase 250 bps of GS (provided price
stays below 180)
 Sell Visa
 Hold position in BRK, HCBK and JPM
 Should bring us underweighting of
200bps*

* If we don’t sell V to fund
Skinner, Sureka, Yan
5
TCF Financial Corporation (NYSE:TCB)





Financial Holding Company
The Company’s businesses include retail and small
business banking, commercial banking, consumer
lending, leasing and equipment finance, and
inventory finance.
TCF Bank operates bank branches in Minnesota,
Illinois, Michigan, Colorado, Wisconsin, Indiana and
Arizona.
The segments of the Company are banking, and
leasing and equipment finance.
In August 2008, the Company announced the
creation of a new subsidiary, TCF Inventory Finance,
Inc.
Skinner, Sureka, Yan
6
Goldman Sachs Group, Inc. (NYSE:GS)


Bank holding company and global investment
banking, securities and investment management
firm that provides services worldwide to
corporations, financial institutions, governments
and high-net-worth individuals.
Its activities are divided into three segments:
Investment Banking, Trading and Principal
Investments, and Asset Management and
Securities Services.
Skinner, Sureka, Yan
7
Visa Inc. (NYSE:V)
Visa Inc. operates a retail electronic payments network.
The Company facilitates global commerce through the
transfer of value and information among financial
institutions, merchants, consumers, businesses and
government entities.
 Primary customers are financial institutions, for which it
provides product platforms encompassing consumer
credit, debit, prepaid and commercial payments.
 The Company owns a family of payment brands, including
Visa, Visa Electron, PLUS and Interlink, which it licenses
to its customers for use in their payment programs. It
manages and promotes its brands through advertising,
promotional and sponsorship initiatives, and by card
usage and merchant acceptance.

Skinner, Sureka, Yan
8
TCB
Key driver of future profitability is credit
loss provisions.
 2008-17.6%
 Modeled at 25% in 2009
 Decreasing by 5% each year and
reaches 5% steady state
 Historically has been below 2%

Skinner, Sureka, Yan
9
Other Important Factors
Company operates in the Midwest
 Poor lending environment exposure is in
Michigan
 Small exposure to Arizona
 Price was depressed from 2008 financial
crisis but didn’t experience the same
increases in 2009 as large cap financials
 Didn’t have a net loss in 2008 or 2009

Skinner, Sureka, Yan
10
TCF Financial (TCB)
TerminalDiscount Rate =
Terminal Growth Rate =
Revenue
% Growth
EBT
EBT Margin
Taxes
Tax Rate
Net Income
% Growth
2009E
1,130,332
2010E
1,169,893
3.5%
175,484
15.0%
64,929
37.0%
110,555
55.2%
2011E
1,210,840
3.5%
242,168
20.0%
89,602
37.0%
152,566
38.0%
2012E
1,253,219
3.5%
313,305
25.0%
115,923
37.0%
197,382
29.4%
2013E
1,297,082
3.5%
389,125
30.0%
143,976
37.0%
245,148
24.2%
2014E
1,335,994
3.0%
400,798
30.0%
148,295
37.0%
252,503
3.0%
2015E
1,376,074
3.0%
412,822
30.0%
152,744
37.0%
260,078
3.0%
2016E
1,417,356
3.0%
425,207
30.0%
157,327
37.0%
267,880
3.0%
2017E
1,459,877
3.0%
437,963
30.0%
162,046
37.0%
275,917
3.0%
2018E
1,503,673
3.0%
451,102
30.0%
166,908
37.0%
284,194
3.0%
67,081
5.9%
67,820
6.0%
70,472
69,429
5.9%
105,290
9.0%
74,694
6.0%
71,859
5.9%
96,867
8.0%
127,558
70.8%
75,193
6.0%
100,258
8.0%
172,318
35.1%
77,825
6.0%
103,767
8.0%
219,207
27.2%
80,160
6.0%
93,520
7.0%
239,143
9.1%
82,564
6.0%
82,564
6.0%
260,078
8.8%
85,041
6.0%
85,041
6.0%
267,880
3.0%
87,593
6.0%
87,593
6.0%
275,917
3.0%
90,220
6.0%
90,220
6.0%
284,194
3.0%
1,038,297
1,288,643
2,326,940
4.6%
44.6%
55.4%
21.7
33.0
50.8
57.9
20.4
31.2
32.7
37.3
113,033
10.0%
41,822
37.0%
71,211
D&A
% of Sales
Capex
% of Sales
Free Cash Flows
% Growth
NPV Cash Flows
NPV Terminal
Projected Equity Value
Free Cash Yield
11.0%
3.0%
Current P/E
Projected P/E
Current EV/EBITDA
Projected EV/EBITDA
Shares Outstanding
Terminal Value 3,659,001
Free Cash Yield
22.1%
Terminal P/E
12.9
Terminal EV/EBITDA
17.5
12.0
18.2
23.7
27.0
128,800
Current Price
Implied Price
Upside/(Downside)
$
$
11.85
18.07
52.5%
Debt
Cash
Cash/Share
4,550,000
329,660
2.56
Skinner, Sureka, Yan
11
Terminal Growth
% Upside Sensitivity Analysis
52.5%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
8.0%
88.0%
104.6%
126.8%
157.8%
204.4%
282.0%
9.0%
63.2%
75.1%
90.4%
110.8%
139.4%
182.3%
Discount Rate
10.0%
11.0%
43.6%
27.6%
52.3%
34.3%
63.3%
42.3%
77.4%
52.5%
96.2%
65.5%
122.5%
82.8%
Skinner, Sureka, Yan
12.0%
14.5%
19.6%
25.7%
33.2%
42.5%
54.5%
13.0%
3.5%
7.5%
12.2%
17.8%
24.7%
33.3%
12
TCB Ratio Analysis
Absolute Basis
High
Low
Median
Current
P/Forward E
23.7
7.7
13.7
23.0
P/B
4.9
1.3
3.5
1.3
P/S
5.3
1.4
3.6
1.8
ROE
27.1
10.0
22.7
10.6
Relative to Sector
High
Low
Median
Current
P/Forward E
1.3
.6
1.1
1.1
P/B
2.9
.8
1.7
1.2
P/S
2.2
.8
1.5
1.3
ROE
1.8
.7
1.4
.7
Skinner, Sureka, Yan
13
Goldman Sachs—Facts
Currently holding
 Last purchased at
 Current Price
 Target Price

1,000 shares
$146.01
$ 176.10
$ 218.82
Skinner, Sureka, Yan
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Goldman Sachs—Earnings
Skinner, Sureka, Yan
15
Goldman Sachs – Key Driver

Trading and Principal Investments
$10.03 Billion
FICC
5.99 Billion
Equities
2.78 Billion
Principle Investments 1.26 Billion
Skinner, Sureka, Yan
16
Goldman Sachs – Expenses
Operating Expenses
C&B
 Non-Compensation
 Provision for Taxes

$7.58 Billion
5.35 Billion
2.23 Billion
32.2%
Skinner, Sureka, Yan
17
Goldman Sachs - Ratios
Absolute Basis
High
Low
Median
Current
P/Forward E
21.5
8.2
12.4
9.3
P/B
5.7
.7
2.1
1.6
P/S
3.6
.4
1.7
2.7
ROE
29.9
4.3
19.5
8.7
Relative to Sector
High
Low
Median
Current
P/Forward E
1.5
.5
.9
.5
P/B
1.8
.7
1.1
1.4
P/S
2.0
.4
.6
2.0
ROE
2.0
.3
1.1
.6
Skinner, Sureka, Yan
18
Goldman Sachs-DCF
Terminal Discount Rate=
Terminal FCF Growth=
Revenue
% Growth
EBT
% Growth
Taxes
Tax Rate
Net Income
% Growth
D&A
% of Sales
Capex
% of Sales
Free Cash Flow
% Growth
NPV Cash Flows
NPV Terminal
Projected Equity Value
Free Cash Flow Yield
2009E
47,090
2010E
46,453
(1.4%)
16,166
(1.9%)
5,173
32.0%
10,184
(2.1%)
2011E
48,550
4.5%
16,798
3.9%
5,543
33.0%
10,446
2.6%
2012E
50,097
3.2%
17,108
1.8%
5,817
34.0%
10,482
0.3%
2013E
51,600
3.0%
17,492
2.2%
6,122
35.0%
10,561
0.8%
2014E
53,148
3.0%
17,911
2.4%
6,269
35.0%
10,833
2.6%
2015E
54,742
3.0%
18,393
2.7%
6,438
35.0%
11,147
2.9%
2016E
56,385
3.0%
18,889
2.7%
6,611
35.0%
11,469
2.9%
2017E
58,076
3.0%
19,455
3.0%
6,809
35.0%
11,837
3.2%
2018E
59,818
3.0%
20,039
3.0%
7,014
35.0%
12,216
3.2%
1,742
3.7%
2,355
5.0%
9,786
1,719
3.7%
2,090
4.5%
9,812
0.3%
1,796
3.7%
1,942
4.0%
10,300
5.0%
1,854
3.7%
1,854
3.7%
10,482
1.8%
1,909
3.7%
1,909
3.7%
10,561
0.8%
1,966
3.7%
1,966
3.7%
10,833
2.6%
2,025
3.7%
2,025
3.7%
11,147
2.9%
2,086
3.7%
2,086
3.7%
11,469
2.9%
2,149
3.7%
2,149
3.7%
11,837
3.2%
2,213
3.7%
2,213
3.7%
12,216
3.2%
62,551
55,394
117,945
10.3%
53.0%
47.0%
16,482
5,274
32.0%
10,398
Current P/E
Projected P/E
Current EV/EBITDA
Projected EV/EBITDA
9.2
11.3
(16.6)
(15.4)
Shares Outstanding
539.0
Current Price
Implied Equity Value/Share
Upside/(Downside) to DCF
11.0%
3.0%
$176.76
$218.82
23.8%
9.4
11.6
(17.0)
(15.7)
Terminal Value 157,287
Free Cash Yield
7.8%
Terminal P/E
12.9
Terminal EV/EBITDA
(10.8)
9.1
11.3
(16.3)
(15.1)
Skinner, Sureka, Yan
19
VISA Inc.
Visa Inc. is currently 27.7% with respect
to sector and 2.6% with respect to SIM
portfolio.
 We would like to sell VisaWhy?...
Approaching its fair value of $81.40

Skinner, Sureka, Yan
20
Visa Inc. DCF
Inc. DCF
Terminal Discount Rate =
Terminal FCF Grow th =
10/19/2009
Year
2009E
2010E
2011E
Revenue
6,911
7,879
8,903
% Grow th
14.0%
EBT
4,000
EBT Margin
57.9%
Interest
-
Interest % of Sales
0.0%
Taxes
1,648
Tax Rate
41.2%
Net Income
2,353
% Grow th
4,483
56.9%
0.0%
1,704
38.0%
2,780
2012E
10,149
13.0%
5,062
14.0%
5,481
56.9%
-
54.0%
-
0.0%
1,873
0.0%
2,028
37.0%
3,189
37.0%
3,453
2013E
11,672
15.0%
6,069
52.0%
0.0%
2,185
36.0%
3,884
10.5%
3.0%
2014E
13,306
14.0%
6,919
52.0%
0.0%
2,491
36.0%
4,428
2015E
15,168
14.0%
7,736
51.0%
0.0%
2,785
36.0%
4,951
2016E
17,140
13.0%
8,741
51.0%
0.0%
3,147
36.0%
5,595
2017E
19,368
13.0%
9,684
50.0%
0.0%
3,486
36.0%
6,198
2018E
21,886
13.0%
10,943
50.0%
0.0%
3,940
36.0%
7,004
2019E
24,731
13.0%
12,366
50.0%
0.0%
4,452
36.0%
7,914
18.1%
14.7%
8.3%
12.5%
14.0%
11.8%
13.0%
10.8%
13.0%
13.0%
226
394
445
406
467
466
531
600
678
766
866
3.3%
5.0%
5.0%
4.0%
4.0%
3.5%
3.5%
3.5%
3.5%
3.5%
3.5%
63
83
(27)
(30)
(35)
(40)
(46)
(51)
(58)
(66)
(74)
0.9%
1.1%
-0.3%
-0.3%
-0.3%
-0.3%
-0.3%
-0.3%
-0.3%
-0.3%
-0.3%
Subtract Cap Ex
310
315
267
304
315
359
379
429
484
547
618
Capex % of sales
4.5%
4.0%
3.0%
3.0%
2.7%
2.7%
2.5%
2.5%
2.5%
2.5%
2.5%
Add Depreciation/Amort
% of Sales
Plus/(minus) Changes WC
% of Sales
Free Cash Flow
2,332
% Grow th
26.1%
NPV of Cash Flow s
NPV of terminal value
Projected Equity Value
Free Cash Flow Yield
27,783
40,921
68,704
3.45%
Current P/E
Projected P/E
Current EV/EBITDA
Projected EV/EBITDA
28.7
29.2
14.8
15.1
Shares Outstanding
Current Price
Implied equity value/share
Upside/(Dow nside) to DCF
Debt
Cash
Cash/share
2,941
3,341
3,524
13.6%
5.5%
4,001
13.5%
40%
60%
100%
4,495
12.3%
5,057
12.5%
5,715
13.0%
6,333
10.8%
7,157
13.0%
Terminal Value
Free Cash Yield
24.3
24.7
12.8
13.1
21.2
21.5
11.4
11.6
8,087
13.0%
111,064
7.28%
Terminal P/E
14.0
Terminal EV/EBITDA
8.0
844.0
$
$
80.00
81.40
1.8%
55
4,979
5.90
Skinner, Sureka, Yan
21
Visa Inc. Ratios
Relative to
Industry
P/Trailing E
P/Forward E
P/B
P/S
P/CF
EntValue/EBITDA
High
Low
Median
Current
2.1
2.3
1.1
8.7
8.4
16.2
1.4
1.4
.7
5.8
1.5
10.0
1.8
1.6
.8
7.3
1.8
13.1
1.5
1.5
.8
7.5
1.7
10
Relative to S&P
500
P/Trailing E
P/Forward E
P/B
P/S
P/CF
EntValue/EBITDA
High
Low
Median
Current
2.1
2.5
1.8
11.3
8.5
16.2
1.3
1.2
1.0
8.4
1.4
10.0
1.7
1.6
1.3
9.4
1.8
13.1
1.4
1.3
1.3
10.8
1.6
10.0
Skinner, Sureka, Yan
22
Recommendations Summary
Company
Current
Weights (bps)
Buy/Sell/Hold
Proposed
Weights (bps)
Berkshire
Hathaway Inc.
230
HOLD
230
Goldman Sachs
Group Inc.
100
BUY
350
Hudson City
Bancorp Inc.
160
HOLD
160
JP Morgan
Chase & Co.
190
HOLD
190
TCF Financial
Corporation
-
BUY
250
Visa Inc.
260
Sell
0
Total
940
1340
* If needed to fund purchases otherwise Hold.
Skinner, Sureka, Yan
23
Questions?
Skinner, Sureka, Yan
24