Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — Q1 2021 Earnings Presentation
24 slides from Pnc Financial Services Group, Inc. (the)'s earnings presentation, Apr 16, 2021
Slide 1: First Quarter 2021 Earnings Conference Call
The PNC Financial Services Group First Quarter 2021 Earnings Conference Call April 16, 2021 Exhibit 99.2
Slide 2: Cautionary Statement Regarding Forward-Looking and Non-GAAP Financial Information
Cautionary Statement Regarding Forward-Looking and Non-GAAP Financial Information Our earnings conference call presentation is not intended as a full business or financial review and should be viewed in the context of all of the information made available by PNC in its SEC filings and on our corpora
Slide 3: First Quarter 2021 Highlights
First Quarter 2021 Highlights 2 Solid financial performance: – Generated linked quarter positive operating leverage – Large provision recapture due to improving economic outlook – Robust deposit growth; loans remained challenged – Maintained strong capital and liquidity position Continued solid
Slide 4: Balance Sheet: Well-Positioned with Record Capital and Liquidity
Balance Sheet: Well-Positioned with Record Capital and Liquidity 3 Total Average Assets Grew LQ 1% Spot Investment Securities Grew LQ 11% Deposit Costs Declined LQ -2 bps Return on Average Assets 1.58% 1Q21 vs. 4Q20 1Q21 vs. 1Q20 Average balances, $ billions 1Q21 $ Chg. % Chg. $ Chg. % Chg. Commerci
Slide 5: Balance Sheet: Continued Deposit Growth Increasing Liquidity
Balance Sheet: Continued Deposit Growth Increasing Liquidity 4 Loan Yield Deposit Cost 4.08% 3.37% 3.32% 3.35% 3.38% 0.70% 0.23% 0.12% 0.08% 0.06% A ve ra ge b al an ce s, $ b ill io n s $243.6 $268.1 $253.1 $245.8 $238.1 $289.7 $335.2 $350.5 $359.4 $365.4 87% 75% 70% 66% 63% 50% 60% 70% 80% 90% 100
Slide 6: Balance Sheet: Substantial Liquidity Presents Upside
Balance Sheet: Substantial Liquidity Presents Upside 5 Securities Yield Avg. IOR 2.78% 2.41% 2.18% 2.08% 1.97% 1.25% 0.10% 0.10% 0.10% 0.10% A ve ra ge b al an ce s, $ b ill io n s – Avg. IOR – Period average of the daily rate for Interest on Reserves (IOR) on balances held at the Federal Reserve. $
Slide 7: Income Statement: Solid Results in the Current Environment
Income Statement: Solid Results in the Current Environment 6 – Pretax, pre-provision earnings (Non-GAAP) – See the reconciliation in the appendix. – Net interest margin is calculated using taxable-equivalent net interest income, a Non-GAAP measure, a reconciliation of which is provided in the append
Slide 8: Income Statement: Broad Based Business Mix
Income Statement: Broad Based Business Mix 7 Total Revenue Stable Linked Quarter Revenue Details of Total Revenue Linked Quarter Noninterest Income Up 5% but NII Down 3% 1Q21 vs. 4Q20 1Q21 vs. 1Q20 $ millions 1Q21 $ Chg. % Chg. $ Chg. % Chg. Net interest income $2,348 ($76) (3%) ($163) (6%) Asset ma
Slide 9: Income Statement: Well Controlled Expenses
Income Statement: Well Controlled Expenses 8 Noninterest Expense Linked Quarter Decline of 5% Details of Noninterest Expense All Categories Declined or Were Flat Linked Quarter 1Q21 vs. 4Q20 1Q21 vs. 1Q20 $ millions 1Q21 $ Chg. % Chg. $ Chg. % Chg. Personnel $1,477 ($44) (3%) $108 8% Occupancy $215
Slide 10: Credit: Better Than Expected Credit Quality Performance
Credit: Better Than Expected Credit Quality Performance 9 − NCO / Average Loans represents annualized net charge-offs (NCO) to average loans for the three months ended. − Delinquencies represents accruing loans past due 30 days or more. Delinquencies to Total Loans represents delinquencies divided b
Slide 11: Credit: Well Reserved for the Current Environment
Credit: Well Reserved for the Current Environment 10 − ACL is Allowance for Loan and Lease Losses plus Allowance for Unfunded Lending Related Commitments, and excludes Allowances for Investment Securities and Other Financial Assets. − Portfolio Changes primarily represent the impact of increases / d
Slide 12: Update on BBVA USA Acquisition
Update on BBVA USA Acquisition 11 Progress to Date Next Steps Conduct mock application and technology conversions to ensure system readiness Finalize alignment strategy for businesses and functional areas Prepare for implementation of PNC Regional President model across BBVA USA markets Plan
Slide 13: Outlook: Second Quarter 2021 Compared to First Quarter 2021
Outlook: Second Quarter 2021 Compared to First Quarter 2021 12 − Refer to Cautionary Statement in the Appendix, including economic and other assumptions. Does not take into account impact of potential legal and regulatory contingencies and merger integration costs. − Average loans, net interest inco
Slide 14: Outlook: PNC Standalone FY 2021 Compared to FY 2020
Outlook: PNC Standalone FY 2021 Compared to FY 2020 13 − FY – Full year. − Refer to Cautionary Statement in the Appendix, including economic and other assumptions. Does not take into account impact of potential legal and regulatory contingencies and merger integration costs. BBVA USA projected PPNR
Slide 15: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking Information 14 This presentation includes “snapshot” information about PNC used by way of illustration and is not intended as a full business or financial review. It should not be viewed in isolation but rather in the context of all of the inf
Slide 16: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking Information 15 Our forward-looking financial statements are subject to the risk that economic and financial market conditions will be substantially different than those we are currently expecting and do not take into account potential legal
Slide 17: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking Information 16 Business and operating results are affected by our ability to identify and effectively manage risks inherent in our businesses, including, where appropriate, through effective use of systems and controls, third-party insurance
Slide 18: Consumer and Retail Small Business Modifications
Appendix: Consumer and Retail Small Business Modifications 17 − Govt. guaranteed / investor owned includes govt. insured or guaranteed loans and investor owned mortgages; $2.6 billion and 55,000 accounts remain in assistance. − Exited Assistance includes loans that were paid-off or charged-off, repr
Slide 19: COVID-19 High Impact Industries
Appendix: COVID-19 High Impact Industries 18 − PPP Lending within the Commercial Real Estate and Related Loans category is not material. − Balances as of 3/31/21; excludes securitizations. − Commercial & Industrial loans exclude PNC Real Estate business loans. Commercial real estate and related loan
Slide 20: Oil & Gas Loans
Appendix: Oil & Gas Loans 19– Excludes securitizations and loans held for sale. $0.8 billion Exploration & Production (0.3% of Loans) Utilization Rate 25% $3.0 billion Outstanding Loan Balance Oil / Gas Mix 46% / 54% Reserve-Based Structure 79% $1.3 billion Midstream and Downstream (0.6% of Loans) $
Slide 21: Non-GAAP to GAAP Reconciliation: Return on Tangible Common Equity
Appendix: Non-GAAP to GAAP Reconciliation 20 Return On Tangible Common Equity (Non-GAAP) For the three months ended $ millions Mar. 31, 2021 Dec. 31, 2020 Mar. 31, 2020 Return on average common shareholders’ equity 14.31% 11.16% 7.51% Average common shareholders’ equity $49,842 $49,525 $45,058 Avera
Slide 22: Non-GAAP to GAAP Reconciliation: Tangible Book Value per Common Share
Appendix: Non-GAAP to GAAP Reconciliation 21 Tangible Book Value per Common Share (Non-GAAP) For the three months ended $ millions, except per share data Mar. 31, 2021 Dec. 31, 2020 Mar. 31, 2020 Book value per common share $118.47 $119.11 $106.70 Tangible book value per common share Common sharehol
Slide 23: Non-GAAP to GAAP Reconciliation: Pretax, Pre-Provision Earnings
Appendix: Non-GAAP to GAAP Reconciliation 22 Pretax, Pre-Provision Earnings (Non-GAAP) For the three months ended $ millions Mar. 31, 2021 Dec. 31, 2020 Mar. 31, 2020 Net interest income $2,348 $2,424 $2,511 Noninterest income 1,872 1,784 1,825 Total Revenue $4,220 $4,208 $4,336 Noninterest expense
Slide 24: Non-GAAP to GAAP Reconciliation: Taxable-Equivalent Net Interest Income
Appendix: Non-GAAP to GAAP Reconciliation 23 Taxable-Equivalent Net Interest Income (Non-GAAP) For the three months ended $ millions Mar. 31, 2021 Dec. 31, 2020 Mar. 31, 2020 Net interest income (GAAP) $2,348 $2,424 $2,511 Taxable-equivalent adjustments 15 17 22 Net interest income (Fully Taxable-Eq
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