Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — Q2 2011 Earnings Presentation
21 slides from Pnc Financial Services Group, Inc. (the)'s earnings presentation, Jul 20, 2011
Slide 1: The PNC Financial Services Group, Inc. Second Quarter 2011 Earnings Conference Call
Exhibit 99.2 The PNC Financial Services Group, Inc. Second Quarter 2011 Earnings Conference Call July 20, 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: Today's Discussion
Today’s Discussion 2Q11 strategic achievements – strong financial results Exceptional client growth and strong new product penetration Key financial take-aways – high quality balance sheet, strong earnings and solid returns 2011 outlook remains positive PNC Continues to Build a Great Company. 3
Slide 4: Significant 2Q11 Achievements
Significant 2Q11 Achievements 2Q11 highlights Delivered strong financial results through improved credit quality and exceptional client growth Grew commercial loans Maintained a high quality balance sheet, poised to support client growth Continued to build capital to record levels Announced the pend
Slide 5: Focused on Growing Client Relationships
Focused on Growing Client Relationships Retail Banking Corporate & Institutional Banking Asset Management Group Organic checking relationship Corporate Banking new primary Assets under administration 4 growth 1 clients (billions) + + 5 2Q11 annualized growth of 5.4%, greater Goal to exceed 1,000 new
Slide 6: Financial Performance
Financial Performance 2Q11 2Q10 YTD11 YTD10 Strong Net income ($ millions) $912 $803 $1,744 $1,474 Earnings Earnings per diluted share $1.67 $1.47 $3.24 $2.15 2Q11 2Q10 YTD11 YTD10 Performance Return on average assets 1.40% 1.22% 1.34% 1.12% Measures 1,2 Return on Tier 1 common capital 16.1% 17.7% 1
Slide 7: A Higher Quality, Differentiated Balance Sheet
A Higher Quality, Differentiated Balance Sheet Change from: Highlights Category (billions) Jun. 30, Mar. 31, Dec. 31, 2011 2011 2010 Total investment securities 59.4 (1.6) (4.8) Core commercial loan growth partially offset by continued Core commercial loans 1 64.0 2.0 3.3 1 distressed loan run-off C
Slide 8: Credit Trends Continue to Improve
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 $2.2 $15.0 $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 loans 1,3 Provi
Slide 9: Net Interest Income and Provision Trends
Net Interest Income and Provision Trends (millions) 2Q10 3Q10 4Q10 1Q11 2Q11 Core NII 1 $1,895 $1,890 $1,857 $1,895 $1,860 Purchase accounting accretion 2 540 325 344 281 290 Total NII $2,435 $2,215 $2,201 $2,176 $2,150 Provision 823 486 442 421 280 3 Provision-adjusted NII $1,612 $1,729 $1,759 $1,7
Slide 10: Client Growth and Sales Momentum Provide Opportunities to Increase Noninterest Revenue
Client Growth and Sales Momentum Provide Opportunities to Increase Noninterest Revenue (millions) 2Q10 3Q10 4Q10 1Q11 2Q11 2Q11 vs. 1Q11 highlights Asset 1 $243 $249 $303 $263 $288 Asset management fees rose due to management higher earnings from BlackRock, higher Consumer services 315 328 322 311 3
Slide 11: Well-Controlled Expenses While Investing for Growth
Well–Controlled Expenses While Investing for Growth (millions) 2Q10 3Q10 4Q10 1Q11 2Q11 2Q11 vs. 1Q11 highlights Personnel $959 $959 $1,032 $989 $976 Personnel, Occupancy and Equipment expenses declined Occupancy 172 177 194 193 176 Marketing expense increased due to elevated advertising costs assoc
Slide 12: Strong Capital Position and Improved Returns
Strong Capital Position and Improved Returns Tier 1 common ratio Book value per common share 10.3% 10.5% 9.6% 9.8% $58.01 $60.02 8.3% $55.91 $56.29 $52.77 1 2Q10 3Q10 4Q10 1Q11 2Q11 2Q10 3Q10 4Q10 1Q11 2Q11 3 2.3 Return on average assets Return on Tier 1 common 21.4% 1.65% 17.7% 1.40% 15.4% 15.4% 16
Slide 13: Outlook – Full Year 2011 vs. 2010
Outlook 1 – Full Year 2011 vs. 2010 Balance Sheet Commercial and consumer loan growth is expected Distressed asset portfolio will continue to run down by 25% per year Continue to shift deposit mix from high cost CD’s towards transaction accounts Income Statement Core NII expected to be stable Purcha
Slide 14: Summary
Summary 2Q11 strategic achievements – strong financial results Exceptional client growth and strong new product penetration Key financial take-aways – high quality balance sheet, strong earnings and solid returns 2011 outlook remains positive PNC Continues to Build a Great Company. 14
Slide 15: 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 16: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix o Changes to regulations governing bank capital, including due to Dodd-Frank and to Basel III initiatives. o Unfavorable resolution of legal proceedings or other claims and regulatory and other governmental investigation
Slide 17: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix • Competition can have an impact on customer acquisition, growth and retention and on credit spreads and product pricing, which can affect market share, deposits and revenues. Industry restructuring in the current enviro
Slide 18: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the three months ended June 30, 2011 Adjustments, Income taxes Average Return on 1 In millions pretax (benefit) Net income Assets Avg. Assets Net income and return on avg. assets, as reported $912 Reported net income, if annualized $3,658 $261,106 1.40% Fo
Slide 19: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the three months ended June 30, 2010 Adjustments, Income taxes Average Return on 1 In millions pretax (benefit) Net income Assets Avg. Assets Net income and return on avg. assets, as reported $803 Reported net income, if annualized $3,221 $264,366 1.22% PN
Slide 20: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the three months ended $ in millions June 30, 2011 Mar. 31, 2011 Dec. 31, 2010 Sept. 30, 2010 June 30, 2010 Net interest margin, as reported 3.93% 3.94% 3.93% 3.96% 4.35% Provision for credit losses $280 $421 $442 $486 $823 Provision for credit losses, if
Slide 21: 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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