Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — Q3 2021 Earnings Presentation
24 slides from Pnc Financial Services Group, Inc. (the)'s earnings presentation, Oct 15, 2021
Slide 1: Third Quarter 2021 Earnings Conference Call
The PNC Financial Services Group Third Quarter 2021 Earnings Conference Call October 15, 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: Third Quarter 2021 Highlights
Third Quarter 2021 Highlights 2− Adjusted metrics are calculated without the impact of $243 million in pre-tax integration costs. See non-GAAP reconciliations in the appendix for calculations of ROTCE (Return on Average Tangible Common Equity) and adjusted EPS, ROA (Return on Average Assets), ROE (R
Slide 4: Balance Sheet: Well-Positioned to Serve Customers
Balance Sheet: Well-Positioned to Serve Customers 3 9/30/21 vs. 6/30/21 9/30/21 vs. 9/30/20 Spot balances; $ billions 9/30/21 $ Chg. % Chg. $ Chg. % Chg. Total loans $290.2 ($4.5) (2%) $40.9 16% Investment securities $125.6 ($0.9) (1%) $34.4 38% Federal Reserve Bank (FRB) balances $75.1 $3.2 4% $4.5
Slide 5: Balance Sheet: Loan Portfolio Composition
$294.7 $290.2 +$1.0 ($1.1) +$3.7 ($3.3) ($4.8) 6/30/2021 Legacy PPP BBVA USA 9/30/2021 Consumer Commercial Balance Sheet: Loan Portfolio Composition 4 Average Loans Growth Driven by Acquisition of BBVA USA $73.2 $79.8 $95.0 $164.9 $175.8 $196.3 $238.1 $255.6 $291.3 3.38% 3.38% 3.32% 2.70% 2.90% 3.10
Slide 6: Balance Sheet: High Quality Low Cost Deposit Base
$452.9 $448.9 +$3.2 ($1.1) +$2.2 ($8.3) 6/30/2021 Legacy BBVA USA 9/30/2021 Noninterest-bearing Interest-bearing Balance Sheet: High Quality Low Cost Deposit Base 5 Av er ag e ba la nc es , $ b ill io ns Average Deposits Growth Driven by Acquisition of BBVA USA Linked Quarter Change in Spot Deposits
Slide 7: Balance Sheet: Opportunity to Deploy Excess Liquidity
Balance Sheet: Opportunity to Deploy Excess Liquidity 6 Sp ot b al an ce s, $ b ill io ns − Securities yield and Avg. IOR (Average daily rate for Interest on Reserve balances held at the Federal Reserve) presented as averages for the quarter indicated by the respective period end date. − At 6/30/21
Slide 8: Income Statement: Record Revenue
Income Statement: Record Revenue 7 − Non-GAAP reconciliations in the appendix slides. − Integration costs include integration expense of $235 million and $101 million in 3Q21 and 2Q21 and contra-revenue of ($8) million and ($10) million in 3Q21 and 2Q21. − Net interest margin is calculated using tax
Slide 9: Income Statement: Diversified Revenue Sources Drive Growth
Income Statement: Diversified Revenue Sources Drive Growth 8 Total Revenue Strong Noninterest Income $1,872 $2,086 $2,341 $2,348 $2,581 $2,856 $4,220 $4,667 $5,197 2.27% 2.29% 2.27% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 0 1000 2000 3000 4000 5000 1Q21 2Q21 3Q21 Noninterest Income Net Interest In
Slide 10: Income Statement: Focused on Controlling Expenses
Income Statement: Focused on Controlling Expenses 9 $ m ill io ns $2,574 $2,770 $2,846 $179 $506 $101 $235 $2,574 $3,050 $3,587 0 500 1000 1500 2000 2500 3000 3500 1Q21 2Q21 3Q21 PNC BBVA USA Integration Expense Noninterest Expense Impacted by BBVA USA and Higher Business Activity Details of Noninte
Slide 11: Credit: Strong Credit Quality Performance
Credit: Strong Credit Quality Performance 10 − 2Q21 charge-offs included $248 million related to BBVA USA that were primarily related to required purchase accounting treatment. − NCO / Average Loans represents annualized net charge-offs (NCO) to average loans for the three months ended. − Delinquenc
Slide 12: Outlook: Fourth Quarter 2021 Compared to Third Quarter 2021
Outlook: Fourth Quarter 2021 Compared to Third Quarter 2021 11 − Refer to Cautionary Statement in the Appendix, including economic and other assumptions. Does not take into account impact of potential legal and regulatory contingencies. − Average loans excluding PPP loans, net interest income, fee i
Slide 13: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking Information 12 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 14: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking Information 13 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 15: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking Information 14 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 16: COVID-19 High Impact Industries
Appendix: COVID-19 High Impact Industries 15 − PPP Lending within the Commercial Real Estate and Related Loans category is not material. − PNC balances as of 9/30/21 and BBVA USA balances as of 8/31/21; balances exclude securitizations. − Commercial & Industrial loans exclude PNC Real Estate busines
Slide 17: Oil & Gas Loans
Appendix: Oil & Gas Loans 16− PNC balances as of 9/30/21 and BBVA USA balances as of 8/31/21; balances exclude securitizations, loans held for sale, and commercial real estate loans. − BBVA USA contributed $1.6 billion in balances to the $3.9 billion of outstanding Oil & Gas loan balances shown abov
Slide 18: Well-Reserved for the Current Environment
Appendix: Well-Reserved for the Current Environment 17 Allowance for Credit Losses (ACL) ACL 6/30/21 ACL 9/30/21 $ m ill io ns $523 $149 $6,375 $6,001 2.16% 2.07% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 0 1000 2000 3000 4000 5000 6000 7000 8000 6/30/2021 Portfolio Econ 9/30/2021 Portfo
Slide 19: Non-GAAP to GAAP Reconciliation: Return On Average Tangible Common Equity
Appendix: Non-GAAP to GAAP Reconciliation 18 Return On Average Tangible Common Equity (non-GAAP) For the three months ended $ millions Sept. 30, 2021 June 30, 2021 Sept. 30, 2020 Return on average common shareholders’ equity 10.95% 8.32% 11.76% Average common shareholders’ equity $51,278 $50,246 $49
Slide 20: Non-GAAP to GAAP Reconciliation: Tangible Book Value per Common Share
Appendix: Non-GAAP to GAAP Reconciliation 19 Tangible Book Value per Common Share (non-GAAP) For the three months ended $ millions, except per share data Sept. 30, 2021 June 30, 2021 Sept. 30, 2020 Book value per common share $121.16 $120.25 $117.44 Tangible book value per common share Common shareh
Slide 21: Non-GAAP to GAAP Reconciliation: Adjusted Income Statement Results
Appendix: Non-GAAP to GAAP Reconciliation 20 Adjusted Income Statement Results (non-GAAP) For the three months ended $ millions Sept. 30, 2021 June 30, 2021 Sept. 30, 2020 Net interest income $2,856 $2,581 $2,484 Noninterest income 2,341 2,086 1,797 Total Revenue $5,197 $4,667 $4,281 Noninterest exp
Slide 22: Non-GAAP to GAAP Reconciliation: Taxable-Equivalent Net Interest Income
Appendix: Non-GAAP to GAAP Reconciliation 21 Taxable-Equivalent Net Interest Income (non-GAAP) For the three months ended $ millions Sept. 30, 2021 June 30, 2021 Mar. 31, 2021 Dec. 31, 2020 Sept. 30, 2020 Net interest income $2,856 $2,581 $2,348 $2,424 $2,484 Taxable-equivalent adjustments 22 15 15
Slide 23: Non-GAAP to GAAP Reconciliation: Noninterest Expense and Adjusted Efficiency
Appendix: Non-GAAP to GAAP Reconciliation 22 Noninterest Expense excluding Integration Expense and Adjusted Efficiency (non-GAAP) For the three months ended For the year ended $ millions Sept. 30, 2021 June 30, 2021 Sept. 30, 2020 Dec. 31, 2020 Noninterest expense $3,587 $3,050 $2,531 $10,297 Integr
Slide 24: Non-GAAP to GAAP Reconciliation: Adjusted Metrics
Appendix: Non-GAAP to GAAP Reconciliation 23 Adjusted Metrics (non-GAAP) For the three months ended Sept. 30, 2021 $ millions, except for ratios and EPS Reported (j) Integration Costs (k) Adjusted (j-k) (non-GAAP) Total revenue (a) $5,197 ($8) $5,205 Noninterest expense (b) 3,587 235 3,352 Pretax, p
PNC Financial Services Group — Q3 2021 Earnings Presentation on 6ix