Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — BancAnalysts Association of Boston Conference 2016
41 slides from Pnc Financial Services Group, Inc. (the)'s conference presentation, Nov 3, 2016
Slide 1: BancAnalysts Association of Boston Conference
Exhibit 99.1 BancAnalysts Association of Boston Conference November 3, 2016 The PNC Finan
Slide 2: Cautionary Statement Regarding Forward-Looking and Adjusted Information
Cautionary Statement Regarding Forward-Looking and ®PNC Adjusted Information This presentation is not intended as a full business or financial review and should be viewed in the context ofall of the by PNC in its SEC fi The presentation may contain forward-looking statements regarding our outlook fo
Slide 3: Highlights for Nine Months 2016
Highlights for Nine Months 2016 = Delivered high quality and consistent results = Compared with the same period a year ago: Grew net interest income Grew fee income Controlled expenses Grew loans and deposits Maintained strong capital and liquidity positions = Continued to execute on our strategic p
Slide 4: Executing Strategic Priorities
Executing Strategic Priorities @®PNC Designed to create value = We are focused on our strategic priorities to drive higher fee income, control expenses and create long-term value ) Building a Leading Banking Franchise in Our Underpenetrated Markets ) Capturing More Investable Assets | ) Reinventing
Slide 5: Navigating the Current Environment
Navigating the Current Environment @®PNC PNC is poised to succeed independent of rates = PNC has additional levers to create positive operating leverage absent rate increases — Digitize customer acquisition, fulfillment and payments — Transform retail banking — Enhance delivery and get paid for valu
Slide 6: Mike Lyons
Mike Lyons EVP, Head of Corporate & Institutional Banking (C&IB) The PNC Finan
Slide 7: Key Takeaways
Key Takeaways ®PNC C&IB performing well Attractive business model Consistent through-the-cycle strategy Credit markets following historical cyclical patterns Lending market conditions have been challenging Pursuing organic growth opportunities Well positioned for the next through-the-cycle growth op
Slide 8: C&IB Overview
C&IB Overview @PNc = C&IB serves businesses and government and not-for-profit entities with annual revenue of $5 million and greater PNC Trailing 12 Month Earnings billions TIM ~ Refers to trailing t NPA - Nonperforming Credit exposure ~ Loan lve months. ‘outstanding plus unfunded cornmitments, C&IB
Slide 9: C&IB Businesses
C&IB Businesses @PNC | Corporate Commercial Business Equipment PNC Real [| Banking Banking Credit Finance Estate = Cash flowlending | | * Cash flowlending | | * Asset-Based = Vendor Finance = Real Estate to clients >$50 to clients Lending Banking = Specialty Finance million sales $5 - $50 million .
Slide 10: C&IB Strategy
C&IB Strategy @®PNC To be the leading i ip-based provider of iti banking products and services through-the-cycle Relationship-Based = Add value to clients = Consistent local market coverage with vertical expertise = Regional President model - Traditional Products and Services | = Domestic focus = In
Slide 11: Highly Cyclical Business
Highly Cyclical Business @®PNC Moody’s Speculative Grade Default Rate 6% 14% 12% 10 % 8% 6% 4% 2% % 1986 1988 1990 1993 1995 1997 2000 2002 2004 2007 2009 2011 2014 2016 11
Slide 12: Performed Well Through-the-Cycle
Performed Well Through-the-Cycle C&IB Loan Growth vs. Industry @PNC Strategic Acquisitions 40% _-PNC C&IB industry - - 30% 2008 20% 427 es) RBC paints KBC 2010 2012 10% C&IB Growth: 2007 to 2012 (20) % 1a10 3a10 1011 3a11 1012 3a12 : Indust based on 2k for further information - RSC Retest pol bee PN
Slide 13: Environment Shifted in 2013
Environment Shifted in 2013 ®PNC The PNC Financial Services Group, Inc. BancAnalysts Association of Boston November 7, 2013 + chen ret ancl ape, coos + everson in: heh noes ih sm + rede ne nro = +» Banks, nonbanks and capital markets aggressively seeking ian + rng comoese, eo pte eee i | {| + mad ge
Slide 14: Lending Market Conditions
Lending Market Conditions S&P 500 Growth in Operating Earnings @PnNc Corporate Leverage x 3.0x BAAB 2013 28x BAAB 2013 26x 24x 22x (25) % 20x (50) % 18% 2001 2004 2008 2012 2016 2000 2004 2008 2012 2016 C&I Loan Delinquencies Bank Loan Yields 5% 8% bh BAAB 2013 “ & BAAB 2013 4h 2% 1% om 0% 0% 2000 2
Slide 15: Loan Growth has Slowed as Expected
Loan Growth has Slowed as Expected ®PNC C&IB Loan Growth vs. Industry 25% —andustry ~—=PNC C&IB 20% 15% 10% 4 points 5% 0% 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 Represents year-over Industry based on further information 15
Slide 16: Loan Growth Detail
Loan Growth Detail PNC pel Say Real Estate Loan Growth vs. Industry ing Commercial Real Estate Related Loans @PNC 20% —PNc induce 16% 12% 8% 4% 0% (4) % 1013 2Q13 3Q13 4Q13 1014 2Q14 3014 4Q14 1Q15 2Q15 3Q15 4Q15 1016 2Q16 PNC Detail $ billions, at period end 4Q07 2Q16 PNC CRE and Commercial Real Es
Slide 17: C&IB Noninterest Income Contribution has Risen
C&IB Noninterest Income Contribution has Risen BAAB 2013 3Q13 YTD C&IB Noninterest Income / Total Revenue WFC 49 % KEY @ > rs) 48% 46% 39 % oO | 35% 34% oe & 33 % 31% 27% 20% 8% See notes on page 35 for further information ~ C&IB for other as iol ws) @PnNc BAAB 2016 3Q16 YTD C&IB Noninterest Income
Slide 18: New Markets Progress - Southeast
New Markets Progress - Southeast PNC 5S "4 MUSIC DIRECTOR SEARCH presented by PNC PNC FATHER. CHALLENGE it Lead Unaided Non-Credit Arranger Roles Awareness Revenue PNC MUSIC PAVILION Comparative Market Credit Productivity Exposure See notes on page 35 for further information.
Slide 19: New Markets Progress - Chicago
New Markets Progress - Chicago PNC Comparative Market Joint Lead Productivity Arranger Roles Unaided Non-Credit Credit Awareness Revenue Exposure See notes on page 35 for further information.
Slide 20: Invested in Our Product Set
Invested in Our Product Set @®PNC New businesses and products since 2013 PINACLE Tax Preservation edit Jeffries REIT Management Partnership unt Module Management Equity Investor elations Advisory (Solebury) Cerberus PNC Senior Loan Operating Rail (Solebury) . Deposit westmen' Recurring Health : thst
Slide 21: Built Advisory Platform
Built Advisory Platform @®PNC DEBT CAPITAL MARKETS Atop 5 arranger of Middle Market loan syndications @PnNc M&A Advisory Harris Williams&Co. middle|market™ A preeminent Middle Market investment bank focused on best-in-class mergers & acquisitions advisory services ESOP Advisory PNC ESOP SOLUTIONS Re
Slide 22: C&IB Contributing to Sales Growth Across Broader PNC Platform
C&IB Contributing to Sales Growth Across Broader PNC Platform © PNC Asset Reported in Asset Management Group Segment 24% 10 % 2015 3Q16 YTD ~ Represents year-over-year growth in C81B-driven sales. Merchant Services Reported in Retail Banking Segment 31% 8% 2015 3Q16 YTD
Slide 23: Investing in Our Technology
Investing in Our Technology ®PNC System Status New commercial loan origination platform Implemented New Tax Credit Capital reporting system Implemented New asset-based lending system Implemented New cloud-enabled data center platform In Process New leasing system In Process New ACH / wire system In
Slide 24: Managing Expenses while Investing for Growth
Managing Expenses while Investing for Growth PNC C&IB Noninterest Expense $ billions $2.03 $2.00 $2.06 $1.63 2012 2013 2014 2015 3Q16 YTD
Slide 25: Strategic Growth Priorities
Strategic Growth Priorities ®PNC Treasury Management Southeast Here and Chicago Expansion Prepare for Next Cycle
Slide 26: Treasury Management
Treasury Management Business Overview $1.6 billion in trailing 12 month revenue >80 % of C&IB primary clients use Treasury Management services Small capital requirement drives very high returns Scale business with recurring revenue and strong underlying secular trends Bespoke solutions align well wi
Slide 27: Secular Change in Treasury Management
Secular Change in Treasury Management @®PNC Cash Services Corporate Payments
Slide 28: Investing in Treasury Management
Investing in Treasury Management ranma ee /P Advantage Pb iat Payments 4 Engine |) te) CRM System ua" fy a) See Clobal Senior Netting Leaders eg . ne) c B2CE- Data Mobile Bb Payments Analysts Delivery
Slide 29: FinTech Investments
FinTech Investments ®PNC TRANSACTIS <> Digital Asset Holdings Zelle () EARLY WARNING” . = The Clearing House CoreCloud
Slide 30: Treasury Management Results
Treasury Management Results PNC Treasury Management Revenue $ millions 3014 YTD 3Q15 YTD 3Q16 YTD ~ See notes on page 35 for further information @PnNc 2015 Product Growth vs. Industry Product Category Chutes Cash Logistics Above Purchasing Card Above Demand Deposit Account Above Wire Above Controlle
Slide 31: Expansion of Middle Market and Corporate Finance
Expansion of Middle Market and Corporate Finance Strong Platform Accretive to C&IB efficiency ratio and return on equity ~11 year average relationship manager Ranked by Greenwich Associates as the #1 bank by Net Promoter Score Early success in Southeast expansion ~ See notes on page 35 for further i
Slide 32: Expansion of Middle Market and Corporate Finance
Expansion of Middle Market and Corporate Finance Action Plan Expand metro market coverage organically over time Announced new markets: Dallas, Kansas City, Minneapolis Run Southeast game plan Deliver full suite of products and services Leverage Regional President model Combine internal talent and lo
Slide 33: Key Takeaways
Key Takeaways ®PNC C&IB performing well Attractive business model Consistent through-the-cycle strategy Credit markets following historical cyclical patterns Lending market conditions have been challenging Pursuing organic growth opportunities Well positioned for the next through-the-cycle growth op
Slide 34: Appendix: Notes
Appendix: Notes @PNc "Page? = C&l lender ig Financial as of 2011 Fi id reflects total ABL assets as of year-end 2015. f year-end 2015. = CRE lender U.S. multifamily, U.S. non-owner occupied CRE, US. construct Fi Las of 201 Lu ts as of 2016, = ABL lender = Loan servicer ranking - from Ernst & 2015. M
Slide 35: Appendix: Notes
Appendix: Notes @PNc Page 17 - peer group, lar toC&lB. M&T and 10/28/16. Pages 18 and 19 roe CaiB , aS appropriate, divided by the population forthe associate average non-South id non-Chicago markets. rable market oroduetialy dest trom 20122018 = Credit exposure - | = Joint lead arranger , coordinat
Slide 36: Appendix: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking ®PNC piidetltcall financial review. It Thould not be viewed in colaion but rather in the content of la the information made avatable by PNC in its SEC flings ents, regarding our outlook for earnings, revenues, stal expenses, capital and ti Tow
Slide 37: Appendix: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking ®PNC Information * Our forward-looking financial statements are subject to the risk that economic and financial the US. economy: vl grow moderately im the latter half of iat a forty steady before aly ‘ang Hates ye: Species ot itlook reflects o
Slide 38: Appendix: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking ®PNC Information — Results gt id process, 9 governmental agencies. iene of our intellectual property protection in general. - Bi fected by out -nt in our businesses, including, a seers ‘wo niches ey notte party insurance, derivatives, ae manag
Slide 39: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Fee Income For the nine months ended _Change 9730/16 Sep. 30, Sep. 30, vs. $ in millions 2016 2015 9/30/15 Asset management $1,122 $1,168 ($46) Consumer services 1,039 986 53 Corporate services 1,117 1,097 20 Residential mortgage 425 453 (28) Service charges
Slide 40: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation ®PNC Tangible Common Shareholders’ Equity $ in miltions, except per share data Dec.31, Jun. 30, 2007 2016 Tangible common shareholders’ equity (Non-GAAP) Common shareholders’ equity $14,847 $42,103} Goodwill and Other intangible assets (8,853) (9.432) Deferr
Slide 41: Appendix: Ticker Symbols
Appendix: Ticker Symbols @PNC PNC Peer Group The PNC Financial Services Group, Inc. PNC Bank of America Corporation BAC BB&T Corporation BBT Capital One Financial, Inc. COF Fifth Third Bancorp FITB JPMorgan Chase & Co. JPM KeyCorp KEY M&T Bank Corporation MTB Regions Financial Corporation RF SunTrus
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