Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — Barclays Capital Global Financial Services Conference 2011
26 slides from Pnc Financial Services Group, Inc. (the)'s conference presentation, Sep 12, 2011
Slide 1: The PNC Financial Services Group, Inc. – Barclays Capital Global Financial Services Conference
Exhibit 99.1 The PNC Financial Services Group, Inc. Barclays Capital Global Financial Services Conference September 12, 2011
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: Industry Better Positioned in Current Environment
Industry Better Positioned in Current Environment Return on average assets Stronger industry position PNC Peer Average¹ Stronger balance sheet 1.5% 1.34% 1.21% 1.0% 1.18% Improving profitability 0.91% 0.5% Diversifying business mix 0.0% -0.5% 2 3 2007 2008 2009 2010 2011 Tangible book value per shar
Slide 4: PNC’s Differentiated Results
PNC’s Differentiated Results 1H11 highlights Return on tangible common equity¹ Net income of $1.7 billion increased by 18% YoY PNC PNC 33% above Peer² five quarter Accelerated customer growth 19% average Commercial loans grew 16% 16% 16% 15% Net charge-offs decreased by 51% YoY 12% Tier 1 common inc
Slide 5: PNC’s Proven Business Model Provides Levers in the Current Environment
PNC’s Proven Business Model Provides Levers in the Current Environment 1 Growing customers 2 Managing risk Positioned for Quality Growth Continuous 3 improvement Disciplined capital 4 management 5
Slide 6: PNC’s Powerful Franchise
PNC’s Powerful Franchise June 30, 2011 U.S. Rank 1 Deposits $182B 7 th th Assets $263B 7 Branches 2,459 5 th CO KS ATMs 6,707 5 th OK Asset Management TX One of the largest bank-held asset managers in the U.S. Retail Corporate & Institutional Proforma footprint covering approximately A leader in ser
Slide 7: Growing Customers – Responding to Changing Customer Behaviors and Needs
Growing Customers – Responding to Changing Customer Behaviors and Needs U.S. banking transactions by channel (billions) 1 Changing customer behaviors Growth in electronic 100 Mobile channels continues to Online reduce consumer check ATM payments Call center 75 Branch The percentage of customers tran
Slide 8: Growing Customers – Retail Banking
Growing Customers – Retail Banking Growth strategies Yielding results Expand market share and Organic checking relationship growth 1,2 New originations share of wallet by providing customers with more choices +130 Free checking and fair value 3 Relationship checking Deepen share of wallet in +76 the
Slide 9: Growing Customers – Corporate & Institutional Banking
Growing Customers – Corporate & Institutional Banking Growth strategies Yielding results Focus on cross-sell of existing Corporate Banking New Cumulative Primary Client 1 Growth relationships 1,000 Achieve high growth customer additions 2010 Actual 750 2011 Actual Invest in high potential markets 50
Slide 10: Growing Customers – Asset Management Group
Growing Customers – Asset Management Group Growth strategies Yielding results Expanding distribution in all markets with a 2 Referral sales 1 New primary clients particular focus on high growth markets 150 external new hires in the first half of 104% 49% 2011 – primarily front line talent acquisitio
Slide 11: RBC Bank (USA) – Strategic Growth Opportunity Priced Below Tangible Book Value
RBC Bank (USA) – Strategic Growth Opportunity Priced Below Tangible Book Value Total market revenue growth 1 for C&IB and AMG RBC’s market opportunities Florida $44 Projected 5-year population growth 4 of 6.5% more than 1.5 times the national $30 average and 5 times PNC’s Retail $26 New primary clie
Slide 12: PNC’s Proven Business Model Provides Levers in the Current Environment
PNC’s Proven Business Model Provides Levers in the Current Environment 1 Growing customers 2 Managing risk Positioned for Quality Growth Continuous 3 improvement Disciplined capital 4 management 12
Slide 13: Managing Risk - Credit Trends Continue to Improve
Managing Risk - Credit Trends Continue to Improve Criticized commercial loans Accruing loans past due 1,2 Criticized Commercial loans 4 30-89 Days 90 Days + $16.4 $15.0 $2.2 $13.7 $1.8 $1.8 $1.9 $12.7 $1.5 $11.7 $2.7 $2.6 $2.7 $2.6 $2.6 2Q10 3Q10 4Q10 1Q11 2Q11 2Q10 3Q10 4Q10 1Q11 2Q11 Nonperforming
Slide 14: Industry Leading Performance
Industry Leading Performance 1 Key 2Q11 credit metrics 2Q11 reserves/loans JPM 4.15% 3.53% BAC 3.96% 3.08% PNC Includes purchased impaired 3.87% 2.93% loan marks 4 RF 3.84% 2.57% 2.37% COF 3.48% FITB 3.35% 1.70% 1.69% PNC 3.08% 1.11% WFC 2.78% KEY 2.57% USB 2.57% BBT 2.43% Nonperforming Nonperformin
Slide 15: Balance Sheet Management
Balance Sheet Management Current environment Extended period of slow economic growth and low interest rates Strategies Increase responsible lending to partially offset lower asset yields Substantially reduce cost of funding to maintain net interest income Maintain liquidity and strong capital positi
Slide 16: PNC’s Proven Business Model Provides Levers in the Current Environment
PNC’s Proven Business Model Provides Levers in the Current Environment 1 Growing customers 2 Managing risk Positioned for Quality Growth Continuous 3 improvement Disciplined capital 4 management 16
Slide 17: Continuous Improvement – Expenses to Remain Flat in 2012
Continuous Improvement – Expenses to Remain Flat in 2012 1 We are targeting expense reductions of $550 million or 2 approximately 6% of PNC’s estimated 2012 expense base These efficiencies provide the capacity to invest in future growth Expense efficiencies are designed not to have an impact on cust
Slide 18: PNC’s Proven Business Model Provides Levers in the Current Environment
PNC’s Proven Business Model Provides Levers in the Current Environment 1 Growing customers 2 Managing risk Positioned for Quality Growth Continuous 3 improvement Disciplined capital 4 management 18
Slide 19: PNC’s Basel III Capital Ratio Estimate
PNC’s Basel III Capital Ratio Estimate Tier 1 common ratio Highlights 8.0% - 8.5% 1 The amount of cushion we choose to hold above and beyond Basel III limits will be a function of multiple inputs such as 7.0% economic conditions, AOCI cushion and 6.375% SIFI buffer, if required 5.75% 5.125% Assumes
Slide 20: Summary
Summary PNC’s proven business model and consistent execution have delivered strong results throughout the cycles Clear levers to drive quality growth in the future Relative valuation gap represents significant long- term 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 informat
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 ability to operate our businesses, financial condition, results of operations, competitive position, reputation, or pursuit of attractive acquisition opportunit
Slide 23: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix o Integration of RBC Bank (USA)’s business and operations into PNC, which will include conversion of RBC Bank (USA)’s different systems and procedures, may take longer than anticipated or be more costly than anticipated
Slide 24: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix Six months ended June 30 Year ended December 31 in millions 2011 2010 2009 2008 2007 Reported net income $1,744 $3,397 $2,403 $914 $1,491 Average assets $261,826 $264,902 $276,876 $142,020 $123,418 Return on average assets 1.34% 1.28% 0.87% 0.64% 1.21% Adjustm
Slide 25: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix As of In millions except per share data Dec. 31, 2007 June 30, 2011 Common shareholders' equity $14,854 $31,588 Common shares outstanding 335 526 Book value per common share $43.60 $60.02 Intangible assets $8,853 $9,005 Common shareholders' equity less intangi
Slide 26: 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,
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