Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — Q3 2016 Earnings Presentation
23 slides from Pnc Financial Services Group, Inc. (the)'s earnings presentation, Oct 14, 2016
Slide 1: Third Quarter 2016 Earnings Conference Call
Exhibit 99.2 Third Quarter 2016 Earnings Conference Call October 14, 2016
Slide 2: Cautionary Statement Regarding Forward-Looking and Adjusted Information
Cautionary Statement Regarding Forward-Looking and ®PNC Adjusted Information Our earnings conference call presentation is not intended as a full business or financial review and — be viewed in the context of all of the information made available by PNC in its SEC filings and on its corporate websi T
Slide 3: Third Quarter 2016 Highlights
Third Quarter 2016 Highlights * Delivered high quality and consistent results — Grew revenue * Higher net interest income + Higher fee income — Grew loans and deposits — Well-controlled expenses — Overall stable credit quality + Lower provision compared to 2Q16 — Maintained strong capital and liquid
Slide 4: Balance Sheet: Grew Loans and Deposits
Balance Sheet: Grew Loans and Deposits @PnNc Change vs. Average balances, $bilions 3016 2a 3015 3016 Highlights Commercial lending $136.8 $0.6 $6.0 * Growth driven by corporate banking and real estate * Growth in auto, residential mortgage and credit card consumer landing. TA (0.1) (2.0) oficet by H
Slide 5: Income Statement: Solid 3Q16 Results
Income Statement: Solid 3Q16 Results @PnNc Change vs. $illions 3016 2016 3015 3016 Highlights Net interest income $2,095 $27 $33. * Core NII growth primarily due to an additional day vs. 2016 Fee income $1,475 $13. «$77 * Fee income growth Other income $259 ($5) ($56) * = Noninterest income $1,736 $
Slide 6: Income Statement: Net Interest Income Growth
Income Statement: Net Interest Income Growth Net Interest Income 3% Core NII Growth Year-Over-Year NIM: 2.67% NIM: 2.70% NIM: 2.68% $2,095 $2,068 $2,062 $ millions 3Q15 2Q16 3Q16 =PAA mCore Nil ~ Core NII (Non-GAAP) -See Reconciliation in Appendix. - NIM) @PnNc Highlights Net interest income increas
Slide 7: Income Statement: Diversified Businesses Drive Fee Income
Income Statement: Diversified Businesses Drive Fee Income PNC Noninterest Income Strong 3016 Noninterest Income $ millions $1,713 $1,726 $1,734 Service Charges Consumer Servi on Deposits $: $174 3Q15 2016 3Q16 Other mFee Income Refers to.a comparison of third quarter 2016 Lo nd quarter 2016 YOY Refe
Slide 8: Income Statement: Well-Controlled Expenses
Income Statement: Well-Controlled Expenses $ millions Well-Managed Expenses During a Time of $10,486 2012 Reinvestment and Growth $9.81 goss $9,463 2013 2014 MNoninterest Expense 2015 2016 full year guidance: Stable with YTD 3Q16 @PnNc Highlights Maintained strong expense discipline while — Investin
Slide 9: Credit Quality: Stable Credit Quality
Credit Quality: Stable Credit Quality $2,177 3Q15 @PNC Nonperforming Loans $2,126 4Q15 $2,281 $2,264 $2,146 1016 2016 Oil, Gas & Coal 3Q16 Provision $152 3Q15, 4Q15 1016 Oil, Gas & Coal 2016 3Q16 Net Charge-Offs $149 $134 $154 3Q15 4Q15 1016 MOIl, Gas & Coal NCO / Average Loans for 3016: 0.29% 2016
Slide 10: Credit Quality: Energy Related Loans - Less than 2% of Total Loans
Credit Quality: Energy Related Loans - Less than 2% of Total Loans & PNC Total Loans $ billions 1.4% $210 billion Outstanding Balances Oil & Gas Loans $ billions Coal Loans $t billion, Outstanding Balances as of 9/30/16 Oil & Gas Loans 3016 2016 Reserves 6% 6% Fs of outstanding Pa oe ans criticized
Slide 11: Outlook: Fourth Quarter 2016 Compared to Third Quarter 2016
Outlook: Fourth Quarter 2016 Compared to Third Quarter 2016 Balance Sheet Loans Up modestly Net interest income Stable Fee income Stable Income eielliale Noninterest expense Up low single digits Loan loss provision $75 - $125 million ~ Refer to Cautionary Staternent in the Appendix, including econom
Slide 12: 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 13: 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 marke di ill the latter half of 2016, prices, 7 id bond yield: will is year do not, unl |, take into account the impact of potential
Slide 14: 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 15: Other Noninterest Income: Net Visa Activity Components
Appendix: Other Noninterest Income: Net Visa Activity Components@ PNC Net Visa Activity For the three months ended Sep.30, Jun.30, Mar.31, Dec. 31, Sep. 30, s in mittions 2016 2016 2016 2015 2015 Gains on Visa Sales $ - $ 8 $ 446 $ 47 $ 43 Derivative Fair Value Adjustments ° (1) (51) (12) (5) (0) Ne
Slide 16: Basel III Regulatory Capital Ratios
Appendix: Basel Ill Regulatory Capital Ratios ®PNC As a result of the staggered effective dates of the final U.S. Basel Ill regulatory capital rules (Basel Ill rules), as well as the fact that PNC remains in the parallel run qualification phase for the advanced approaches, regulatory risk-based nd 2
Slide 17: Non-GAAP Basel III Regulatory Capital Ratios
Appendix: Non-GAAP Basel III Regulatory Capital Ratios ®PNC id y Tier 1 Capital Ratios 2015 Transitional Pro forma Fully Phased-In Basel ll 2016 Basel (estimated) $ep.30, Jun.30, Sep.30, Sep.30, Jun.30, Sep.30, ie cdions 2016 2016 2015 2016 2016 2015 lc. stock, related surpl treasury st $41,605. $41
Slide 18: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation ®PNC Tangible Book Value per Common Share Ratio % Change 9730/18 9/30/16 $ in millions, except per share data Sep.30, Jun.30, Sep. 30, vs. vs. 2016 2016 2015 6/30/18 _ 9/30/15 Book value per common share. $86.57 $85.33 $81.42 1% 6% Tangible book value per co
Slide 19: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Return on Tangible Common Equity @PnNc $ in mittions Return on average common shareholders’ equity JAverage common shareholders’ equity Average Goodwill and Other intangible assets JAverage tangible common equity Net income attributable to common shareholder
Slide 20: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Pretax Pre-Provision Earnings For the three months ended % Change 9/30/16 9/30/16 $ in miions Sep.30, Jun.30, Sep. vs. vs. 2016 2016 2015 6/30/16 9/30/15 Net interest income $2,095 $2,068 $2,062 1% 2% Noninterest income 1,734 1,726 1,713 * 1% Total revenue 3
Slide 21: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation ®PNC Core Net Interest Income For the three months ended % Change 9730/18 9/30/16 $ in mittions Sep.30, Jun.30, Sep.30, vs. i 2016 2016 2015 6/30/16 _ 9/30/15 Core net interest income (Non-GAAP) $2,033 $2,004 $1,972 1% 3% Total purchase accounting accretion
Slide 22: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Core Net Interest Margin @PnNc For the three months ended Sep.30, Jun. 30, Sep. 30, 2016 16 2015 Core net interest margin (Non-GAAP) 2.61% 2.63% 2.57% Purchase accounting accretion impact on net interest margin 0.07% 0.07% 0.10% Net interest margin 2.68% 2.7
Slide 23: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Fee Income For the three months ended % Change 3016 9/30/16 Sep.30, Jun.30, Sep. 30, vs. vs. $ in millions 2016 2016 2015 6/30/16 _9/30/15 Asset management $404 $377 $376 ™% ™M% Consumer services 348 354 341 (2%) 2% Corporate services 389 403 384 (3%) 1% Res
PNC Financial Services Group — Q3 2016 Earnings Presentation on 6ix