Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — Merrill Lynch Banking and Financial Services Conference 2004
31 slides from Pnc Financial Services Group, Inc. (the)'s conference presentation, Nov 16, 2004
Slide 1: The PNC Financial Services Group, Inc.
EXHIBIT 99.1 The PNC Financial Services Group, Inc. Merrill Lynch Banking and Financial Services Conference New York, NY November 16, 2004
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information This presentation contains forward-looking statements regarding our outlook or expectations relating to PNC’s future business, operations, financial condition, financial performance and asset quality. Forward-looking statements are necessari
Slide 3: PNC – A Diversified Financial Services Company
Global fund processing: PFPC – with offices in U.S., Ireland & Luxembourg PNC – A Diversified Financial Services Company Business Leadership Regional Community Banking A leading community bank in PNC’s major markets 8th-largest national ATM network Wholesale Banking Top 10 bank-owned Treasury Manage
Slide 4: Today's Discussion
Today’s PNC’s plans to accelerate Discussion banking revenue growth
Slide 5: Long-Term Growth Goals
Excludes impact of pending acquisitions Long-Term Growth Goals Annualized Earnings Growth Banking businesses 5 - 7% Asset management and processing 15 - 20% Capital management 1 - 3% Consolidated PNC 10 - 12%
Slide 6: Regional Community Banking Growth Strategies
Regional Community Banking Growth Strategies We Are Focused on Acquiring, Growing and Retaining Clients by… Increasing and deepening checking relationships Growing valuable home equity loan portfolio Capturing small business opportunities
Slide 7: Expanding Client Acquisition Channels
Expanding Client Acquisition Channels Sources of Customer Acquisition Checking Relationships Acquired thousands 200 150 100 50 0 +44% +20% 2000 2004 Alternative Delivery Channels Branches Regional Community Banking Growth in Selected Alternative Delivery Channels 2004 vs 2000 Workplace banking +47%
Slide 8: Growing a Valuable Core Deposit Base
Growing a Valuable Core Deposit Base Regional Community Banking Focused on Increasing and Deepening Checking Relationships Checking Customer Base millions 2.0 1.5 1.0 0.5 0.0 2000 2001 2002 2003 9/30/04 6% CAGR Single-service Multi-service Average Demand Deposits $ billions $16.0 $12.0 $8.0 $4.0 $0.
Slide 9: Comprehensive View of the Client
Comprehensive View of the Client Regional Community Banking Client Data Consistent Across All Channels and Delivery Points Branch Personal Computer Call Center Propensity to Buy Activity Log ATM
Slide 10: Utilizing Technology to Deepen Relationships
Utilizing Technology to Deepen Relationships Regional Community Banking 44% of DDA Households Use Online Banking Account Link DDA Households Using Online Banking thousands 600 550 500 21% Increase Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 2003 2004
Slide 11: Growing High Quality Home Equity Loans
Growing High Quality Home Equity Loans Average Home Equity Loans $ billions $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 2001 2002 2003 3Q04 2 3 % C A G R Regional Community Banking Home Equity Portfolio Credit Statistics First lien positions 51% Weighted average: Loan to value 71% FICO scores 717 Net charg
Slide 12: Capturing the Small Business Opportunity
Capturing the Small Business Opportunity Regional Community Banking Loans $ billions $1.5 $1.0 $0.5 $0.0 ‘01 ‘02 ‘03 ‘04 12/01 12/02 12/03 9/04 Loan Production Outstandings - Average Deposits $ billions $3.0 $2.0 $1.0 $0.0 2001 2002 2003 9/04 December Average Average Noninterest-bearing DDA Money ma
Slide 13: Wholesale Banking Growth Strategies
Wholesale Banking Growth Strategies Selectively pursue large corporate business Deliver large bank capabilities to the middle market Leverage national reach and technology-oriented, fee-based products
Slide 14: Sharpening Our Middle Market Focus
Sharpening Our Middle Market Focus Wholesale Banking Opportunity Middle market companies with sales of $20 - $50 million Response Added resources Developed specific package of products Streamlined credit approval process Accelerating Customer Acquisition Mix of New Middle Market Customers 100% 80% 6
Slide 15: Business Credit: A National Leader in Asset-Based Lending
Business Credit Wholesale Banking A National Leader in Asset-Based Lending Key Growth Initiatives Expand sales force Increase direct originations Leverage relationships to sell fee-based products Total Noninterest Income $ millions $40 $30 $20 $10 $0 2000 2001 2002 2003 YTD 9/30/04 Annualized 1 8 %
Slide 16: Real Estate Finance: Unique National Platform
9/30/04 vs 9/30/03 Period-end loans +12% Servicing portfolio +16% CMBS conduit origination +32% Real Estate Finance Wholesale Banking Unique National Platform Key Growth Initiatives Continue to expand customer base nationally Further realize opportunities with private developers and pension advisors
Slide 17: Treasury Management: Winning Clients with Value-Added Technology Products
Source for industry growth in P-Card is Visa U.S.A. Source for industry growth in electronic data interchange and B2B lockbox is Ernst & Young annual survey of the top 100 banks in Treasury Management Treasury Management Wholesale Banking Winning Clients with Value-Added Technology Products Key Grow
Slide 18: Loan Demand Beginning to Increase
Loan Demand Beginning to Increase Wholesale Banking Relative Change in PNC Wholesale Banking Loans Compared to Industry 110% 100% 90% 80% 2002 2003 2004 PNC Wholesale Loans Outstanding* C&I Loans Outstanding ** Loans outstanding exclude reclassification of Market Street Funding purchased customer re
Slide 19: PNC Advisors Growth Strategies
Strengthen sales and relationship management Create a distinctive client experience Leverage other PNC businesses PNC Advisors Growth Strategies
Slide 20: Continuing to Strengthen Sales Management
Results reflect nine months ended September 30, 2004 versus nine months ended September 30, 2003 Continuing to Strengthen Sales Management PNC Advisors Results Are Promising Increased pipeline opportunities by 53% Realized double digit increase in wealth management sales Leveraged banking products t
Slide 21: Significant Market Opportunity
Source: Axiom Significant Market Opportunity PNC Advisors PNC Millionaire Clients PNC Bank Clients PNC Advisors Clients PNC Advisors Referrals from Regional Community Banking up 49% year over year Resultant sales up 193% year over year
Slide 22: Expanding Presence in Growing Markets
Source: SNL Financial Expanding Presence in Growing Markets 60% of PNC Branches Located between New York City and Washington, DC NY Erie PA Trenton IN Pittsburgh OH Philadelphia NJ Cincinnati MD Riggs Franchise Washington, DC KY DE Louisville WV Lexington VA PNC Branch Locations
Slide 23: Consolidated Revenue Trends Improving
Net interest income on a taxable-equivalent basis is reconciled to GAAP net interest income in the Appendix Consolidated Revenue Trends Improving Revenue Mix $ billions $4.0 $3.5 $3.0 $2.5 $2.0 $1.5 $1.0 $0.5 $0.0 2001 2002 2003 YTD 9/30/04 Annualized Noninterest Income Net Interest Income (Taxable-
Slide 24: Every day is an opportunity to do more
Every day is an opportunity to do more
Slide 25: Appendix
Appendix
Slide 26: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information We make statements in this presentation, and we may from time to time make other statements, regarding our outlook or expectations for earnings, revenues, expenses, capital levels, asset quality or other future financial or business performa
Slide 27: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) (8) how we choose to redeploy available capital, including the extent and timing of any share repurchases and acquisitions or other investments in our businesses; (9) the impact, extent and timing of technological changes, the ad
Slide 28: Additional Information About the Proposed Riggs National Corporation Acquisition
Additional Information About the Proposed Riggs National Corporation Acquisition The PNC Financial Services Group, Inc. and Riggs National Corporation have filed a proxy statement/prospectus and will file other relevant documents concerning the merger with the United States Securities and Exchange C
Slide 29: Non-GAAP to GAAP Reconcilement: Business Segment Earnings
Non-GAAP to GAAP Reconcilement Appendix Business Segment Earnings Nine Months Ended 9/30/04 Business Earnings $ millions Earnings (Loss) Contribution Banking businesses Regional Community Banking $361 39% Wholesale Banking 335 36% PNC Advisors 82 9% Total banking businesses 778 84% Asset management
Slide 30: Non-GAAP to GAAP Reconcilement: Net Interest Income
Non-GAAP to GAAP Reconcilement Appendix Net Interest Income $ millions 2001 1Q02 2Q02 3Q02 4Q02 2002 Net interest income, GAAP basis $2,262 $590 $555 $528 $524 $2,197 Taxable-equivalent adjustment 16 3 3 4 3 13 Net interest income, taxable-equivalent basis $2,278 $593 $558 $532 $527 $2,210 1Q03 2Q03
Slide 31: Non-GAAP to GAAP Reconcilement: Wholesale Banking Loans
Non-GAAP to GAAP Reconcilement Appendix Wholesale Banking Loans Outstanding * $ millions Wholesale Banking Loans Three Months Total Wholesale - Market Street = Outstanding Excluding Ended Banking Loans Funding Loans Market Street 9/30/03 $17,478 $2,481 $14,997 12/31/03 16,441 2,223 14,218 3/31/04 16
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