Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — CLSA AsiaUSA Forum (March 2010)
30 slides from Pnc Financial Services Group, Inc. (the)'s conference presentation, Mar 3, 2010
Slide 1: The PNC Financial Services Group, Inc. CLSA AsiaUSA Forum
Exhibit 99.1 The PNC Financial Services Group, Inc. CLSA AsiaUSA Forum March 3, 2010
Slide 2: Cautionary Statement Regarding Forward-Looking Information and Adjusted Information
Cautionary Statement Regarding Forward-Looking Information and Adjusted Information This presentation includes “snapshot” information about PNC used by way of illustration. It is not intended as a full business or financial review and should be viewed in the context of all of the information made av
Slide 3: Today’s Discussion
Today’s Discussion Solid 2009 financial PNC’s performance achievements have been exceptional Significant execution across our businesses has PNC well-positioned for growth PNC Continues to Build a Great Company. 3
Slide 4: Teamwork: Execute
Slide 5: PNC’s Powerful Franchise
PNC’s Powerful Franchise 2009 Overview Dec. 31, 2009 U.S. Rank 1 Deposits $187 billion 5 th Assets $270 billion 8 th Branches 2,512 5 th CO KS ATMs 6,473 5 th OK Asset Management TX One of the largest bank-held asset managers in the U.S. Retail Corporate & Institutional Footprint covering nearly 1/3
Slide 6: PNC’s Framework for Success
PNC’s Framework for Success 2009 Overview PNC Peers 2 PNC Business Dec. 31, Key Metrics Target Action Plans Model Dec. 31, 2009 2009 Loan to Maximize credit portfolio value Staying core 93% deposit ratio 84% 80%-90% Reposition deposit gathering funded (as of) strategies Provision to Focus “front doo
Slide 7: Transitioning to a Higher Quality, Differentiated Balance Sheet
Transitioning to a Higher Quality, 2009 Differentiated Balance Sheet Overview Category (billions) Dec. 31, YoY 2009 change Balance sheet positioning Investment securities $56 $13 Total loans 157 (18) Core funded - loan to deposit ratio Other assets 57 (16) of 84% Total assets $270 ($21) Appropriatel
Slide 8: Pretax Pre-Provision Earnings Substantially Exceed Credit Costs
Pretax Pre-Provision Earnings 1 Substantially 2009 Exceed Credit Costs Overview Full year 2009 2009 pretax pre-provision earnings 1 /provision $17.0 MTB 1.86 X PNC Excluding the BLK/BGI gain 1.57 x² 1.85 $9.7 WFC 1.83 JPM 1.50 $7.3 USB 1.47 BBT 1.37 COF 1.32 $3.9 FITB 1.22 $2.4 BAC 1.09 CMA 0.89 RF
Slide 9: Opportunities for Delivering Shareholder Value
Opportunities for Delivering Well- Shareholder Value Positioned for Growth Return on average assets 1.30%+ REVENUE CREDIT COSTS Revenue EXPENSES growth Improvement in enhancements Capture credit costs integration cost .62% 1 saves Execution Economic recovery Year ended Potential Dec. 31, 2009 PNC Is
Slide 10: Integration Progress
Well- Integration Progress Positioned for Growth PNC integration cost saves # Customers converted to PNC Highlights 6 Millions Millions $1,500 Branch divestitures completed by September 2009 5 $1,300+ Jun Increased estimate of integration 4Q09 2010 2 annualized savings by $300 million at year- >$1,2
Slide 11: Strong Loss Coverage
Well- Strong Loss Coverage Positioned for Growth 2009 reserves / net charge-offs 2009 reserves / total loans PNC 1.9 X JPM 4.99% MTB 1.7 FITB 4.75% BBT 1.5 COF 4.54% FITB 1.5 KEY 4.28% RF 1.4 BAC 3.94% JPM 1.4 RF 3.38% WFC 1.3 PNC 3.22% USB 1.3 WFC 2.96% CMA 1.1 STI 2.64% KEY 1.1 USB 2.54% BAC 1.1 B
Slide 12: Meeting Changing Customer Needs
Well- Meeting Changing Customer Needs Positioned for Growth PNC has recognized and responded to: Declining check usage Higher purchasing through alternative channels Increasing online banking and online bill pay usage Importance of deepening customer relationships Need for successful, innovative pla
Slide 13: Growing and Deepening Relationships
Well- Growing and Deepening Relationships Positioned for Growth Alternative distribution channels are critical Deepening relationships drives retention to sustained growth and profitability Legacy PNC 1retail checking Legacy PNC 1active online bill pay relationship growth during the year customers 1
Slide 14: Product Innovation
Well- Product Innovation Positioned for Growth “A slick personal finance tool” - BUSINESSWEEK “One of the boldest enhancements to the online banking experience” - CELENT “A truly inspired effort” - NETBANKER Average new accounts opened per day at 300+ in 2009 A successful platform to reach a From 4Q
Slide 15: Growing Relationship-Based Revenue
Well- Growing Relationship-Based Revenue Positioned for Growth C&IB product revenue¹ Asset management revenue² millions millions $650 $250 +41% $520 $200 $390 +330% $150 $260 $100 $130 +7% $50 $0 $0 1Q09 4Q09 1Q09 4Q09 Commercial mortgage banking activities 4Q09 PNC assets under Capital markets Trea
Slide 16: Product Sales Across the Franchise
Well- Product Sales Across the Franchise Positioned for Growth 2009 FY annualized sales contribution by region Sales highlights Total franchise FY09 sales 132% of full year goal Legacy PNC Products 4Q09 sales up 41% vs. 1Q09 markets¹ 58% Corporate Banking Legacy PNC markets¹ Wealth FY09 sales 136% o
Slide 17: Balance Sheet Management
Well- Balance Sheet Management Positioned for Growth PNC Duration Fed Funds of Equity Effective Rate (At Quarter End) (At Quarter End) PNC 4Q09 NII Sensitivity 4 6% st 3 Effect on NII in 1 year from 5% gradual interest rate change 2 over following 12 months 1 4% 100 bps increase 1.1% 0 (1) 3% 100 bp
Slide 18: February 2010 Actions
Well- February 2010 Actions Positioned for Growth Redeemed $7.6 billion of PNC preferred stock held by the US Treasury - Eliminated $380 million in annual preferred dividends Reached a definitive agreement to sell PNC Global Investment Servicing for $2.3 billion - Expected $1.6 billion increase to T
Slide 19: Relative Capital Positioning
Well- Relative Capital Positioning Positioned for Growth December 31, 2009 Tier 1 common ratio 10.7% PNC’s capital priorities 8.8% 8.5% 8.0% 8.2% 7.5% 7.7% 7.8% Maintain strong capital 7.2% 6.8% 7.0% levels 6.5% 6.0% Support our clients Invest in our businesses Return capital to shareholders when ap
Slide 20: Summary
Summary PNC’s achievements have been exceptional given the challenging environment PNC’s businesses continued to execute and are well-positioned as the economy recovers PNC’s positioning and opportunities for growth are expected to deliver significant value PNC Continues to Build a Great Company. 20
Slide 21: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information Appendix 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 informa
Slide 22: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix •Legal and regulatory developments could have an impact on our ability to operate our businesses or our financial condition or results of operations or our competitive position or reputation. Reputational impacts, in tur
Slide 23: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix •Our ability to achieve anticipated results from this transaction is dependent on the state going forward of the economic and financial markets, which have been under significant stress recently. Specifically, we may inc
Slide 24: Impact of Planned Sale of GIS
Impact of Planned Sale of GIS 1 Appendix Estimated gain, cash proceeds and capital enhancement (billions) Book Cash Sales price $2.3 $2.3 Less: Book equity / intercompany debt (1.5) Adjustments / other 2 (0.0) (0.2) Pretax gain 0.8 2.1 Taxes (0.3) (0.3) After tax gain / increase in cash 0.5 $1.8 Eli
Slide 25: Risk-Based Capital Ratios
Risk-Based Capital Ratios Appendix $ in billions Tier 1 common 1 Tier 1 risk based 1 December 31, 2009 $13.8 $26.4 Ratios 6.0% 11.5% TARP redemption 2,3 (.3) (7.6) Common equity offering 4 3.0 3.0 Net impact of sale of GIS 5 1.6 1.6 Proforma $18.1 $23.4 Proforma ratios 8.0% 10.3% (1) Estimated. (2)
Slide 26: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix December 31, 2008 Income taxes For the three months ended, in millions Pretax (benefit) (a) Net income Reported net income (loss) ($246) National City conforming provision for credit losses $504 ($176) 328 Net income excluding National City conforming provisio
Slide 27: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix Year ended Dec. 31, 2009 Three months ended Dec. 31, 2009 Reported Reported Gain on excluding Gain on excluding BlackRock/BGI BlackRock/BGI BlackRock/BGI BlackRock/BGI in millions Reported transaction gain Reported transaction gain Net interest income $9,054 $
Slide 28: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix Three months ended Year ended March 31, 2009 June 30, 2009 Sept. 30, 2009 Dec. 31, 2009 Dec. 31, 2009 in millions Total revenue $3,871 $3,987 $4,048 $5,082 $16,988 Noninterest expense 2,328 2,658 2,379 2,369 9,734 Pretax pre-provision earnings 1,543 1,329 1,66
Slide 29: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix December 31, 2009 September 30, 2009 Adjustments, Income taxes Net Diluted Adjustments, Income taxes Net Diluted For the three months ended, in millions except per share data Pretax (benefit) (a) Income EPS Pretax (benefit) (a) Income EPS Net income, as report
Slide 30: Peer Group of Banks
Peer Group of Banks Appendix Ticker The PNC Financial Services Group, Inc. PNC BB&T Corporation BBT Bank of America Corporation BAC Capital One Financial, Inc. COF Comerica Inc. CMA Fifth Third Bancorp FITB JPMorgan Chase JPM KeyCorp KEY M&T Bank MTB Regions Financial Corporation RF SunTrust Banks,
PNC Financial Services Group — CLSA AsiaUSA Forum (March 2010) on 6ix