Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — BancAnalysts Association of Boston (November 2010)
31 slides from Pnc Financial Services Group, Inc. (the)'s conference presentation, Nov 5, 2010
Slide 1: The PNC Financial Services Group, Inc. BancAnalysts Association of Boston
Exhibit 99.1 The PNC Financial Services Group, Inc. BancAnalysts Association of Boston November 4, 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: Key Take-Aways
Key Take-Aways PNC’s business model and execution have delivered strong results in this challenging environment PNC has made significant progress toward returning to a moderate risk profile PNC has meaningful opportunities to improve market share PNC has demonstrated the ability to deliver sharehold
Slide 4: A Powerful Franchise Focused on Quality Growth
A Powerful Franchise Focused on Quality Growth Execution 1 Sept. 30, 2010 U.S. Rank th Deposits $179 billion 6 th Assets $260 billion 8 th CO KS Branches 2,461 5 th OK ATMs 6,626 5 Asset Management TX One of the largest bank-held asset managers in the U.S. Retail Corporate & Institutional Footprint
Slide 5: Continuing to Build a Great Company
Continuing to Build a Great Company Execution 3Q10 highlights Continued to deliver strong financial results in a challenging environment High quality and well-positioned balance sheet; increased bank liquidity and strengthened capital Credit quality improvement Businesses continued to grow clients a
Slide 6: PNC's Business Model
PNC’s Business Model Execution Staying core funded and disciplined in our deposit pricing Returning to a moderate risk profile Leveraging customer relationships and our strong brand to grow high quality, diverse revenue streams Creating positive operating leverage1 while investing in innovation Rema
Slide 7: Building a High Quality, Differentiated Balance Sheet
Returning Building a High Quality, to a Differentiated Balance Sheet Moderate Risk Profile Category (billions) Change from 1 Sept. 30, 2010 Highlights Dec. 31, 2008 Investment securities $63.5 $20.0 Total loans 150.1 (25.4) Loans to deposits ratio of 84% Other assets 46.5 (25.5) Loans declined drive
Slide 8: Relative Cost of Credit
Returning to a Relative Cost of Credit Moderate Risk Profile Provision for credit losses to average loans Overheated economy Recession Slow growth economy 3.99% 2 3.16% PNC Peers 2.37% 2.61% 1.36% 1.78% 1.15% 1 0.88% 0.71% 1.39% 0.64% 0.66% .83% .13% .50% .49% .04% .25% 2002 2003 2004 2005 2006 2007
Slide 9: Active Credit Risk Management
Returning to a Active Credit Risk Management Moderate Risk Profile 1 Key 3Q10 metrics 3Q10 reserves / YTD10 annualized NCOs MTB 2.5 X 4% 3.84% PNC 1.8 3.48% 3.41% 1.6 3.22% CMA 3% 2.75% 2.81% JPM 1.4 WFC 1.3 2.18% USB 1.2 2% 1.61% FITB 1.2 BAC 1.2 1% RF 1.1 KEY 1.1 0% STI 1.0 Nonperforming Nonperfor
Slide 10: Active Balance Sheet Management
Returning to a Active Balance Sheet Management Moderate Risk Profile PNC Duration Fed Funds of Equity Effective Rate (At Quarter End) (At Quarter End) PNC 3Q10 NII Sensitivity 4 6% st 3 Effect on NII in 1 year from gradual 5% interest rate change over following 12 2 months 1 4% 100 bps increase +1.5
Slide 11: Favorable Credit Risk-Adjusted Returns
Returning 1 to a Favorable Credit Risk-Adjusted Returns Moderate Risk Profile 1 YTD10 net interest margin YTD10 credit risk-adjusted NIM COF 7.13% COF 5.30% WFC 4.26% MTB 3.19% PNC 4.18% PNC 2.96% BBT 4.02% WFC 2.67% USB 3.90% CMA 2.12% MTB 3.82% USB 2.06% FITB 3.62% BBT 2.06% STI 3.34% JPM 2.04% KE
Slide 12: Credit Risk-Adjusted Net Interest Margin Trend
Returning 1 to a Credit Risk-Adjusted Net Interest Margin Trend Moderate Risk Profile 1 2 PNC credit risk-adjusted margin vs. Peers 2 PNC Peers 4.50% 3.43% 3.40% 3.32% 3.38% 3.33% Average 3.50% 2.96% PNC 2.90% 3.26% 2.88% 3.27% 3.14% 2.97% 2.50% 2.76% 2.68% 2.18% 2 2.49%3 Peers 2.17% 2.68% 1.50% 1.4
Slide 13: Growing Diversified Fee-Based Revenue Streams
Growing Growing Diversified Fee-Based Revenue Streams Fee-based Revenue 1 2 Full year 2008 noninterest income mix Annualized YTD10 noninterest income mix Categories in millions Categories in millions 13% 11% Deposit Deposit service 19% service 21% charges charges 22% $764 Consumer $372 Corporate Con
Slide 14: Demonstrated Opportunities to Grow Corporate Services Revenue
Demonstrated Opportunities to Grow Growing Fee-based Corporate Services Revenue Revenue Treasury Management Capital Markets 1 1 Revenue Revenue One of the nation's top A leading provider of innovative $919 investment banking solutions to treasury management $841 providers $411 the middle market Exce
Slide 15: Demonstrated Opportunities to Grow Fee-Based Revenue
Demonstrated Opportunities to Grow Growing Fee-based Fee-Based Revenue Revenue Asset Management Residential Mortgage 1 Revenue Servicing Fees $751 Asset Management Group Aligning the business with continued to outperform sales $196 PNC’s model $639 and client acquisition goals $171 Focused on levera
Slide 16: A Demonstrated Ability to Grow and Deepen Relationships
A Demonstrated Ability to Grow and Growing Fee-based Deepen Relationships Revenue Growing and retaining checking relationships 3 Checking relationships Retail active customers (thousands) (Change during the quarter) Online banking Online bill payment +53,000 2,968 2,682 +43,000 +37,000 942 753 1 2 3
Slide 17: Disciplined Expense Management
Delivering Disciplined Expense Management Shareholder Value PNC acquisition-related cost saves Highlights $1.8 billion $1.7 billion Branch conversions complete $900 million captured Successfully captured $1.7 billion in through 3Q10 annualized acquisition-related cost savings through 3Q10, well ahea
Slide 18: PNC's Framework for Success
Delivering PNC’s Framework for Success Shareholder Value PNC Business Strategic Key Metrics Sept. 30, 2010 Action Plans Model Objective Staying core Loans to Maximize credit portfolio value deposits ratio 84% 80%-90% funded (as of) Reposition deposit gathering strategies Provision to Returning to a
Slide 19: Well Positioned Capital Level to Support Growth
Delivering Well Positioned Capital Level to Support Growth Shareholder Value Sept. 30, 2010 Tier 1 common ratio PNC’s capital priorities 10.0% 9.5% 9.6% Maintain strong levels 9.0% 8.5% 8.6% 8.0% 8.0% 8.2% Support our clients 7.6% 7.6% 7.3% 6.4% Invest in our businesses 4.8% Basel III clarity Return
Slide 20: A Demonstrated Ability to Achieve Greater Shareholder Value
A Demonstrated Ability to Achieve Delivering Shareholder Greater Shareholder Value Value Book value and tangible book value¹ 1 Book value per share Tangible book value per share 2 3 2 PNC Peers PNC Peers $55.91 $35.89 $39.44 $29.99 $28.98 $13.10 $18.04 $16.85 4Q08 3Q10 4Q08 3Q10 4Q08 3Q10 4Q08 3Q10
Slide 21: Summary
Summary We have delivered strong results We are focused on delivering risk-adjusted revenue growth We are committed to delivering shareholder value PNC Continues to Build a Great Company. 21
Slide 22: 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 23: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix •We will be impacted by the extensive reforms enacted in the Dodd-Frank Wall Street Reform and Consumer Protection Act. Further, as much of that Act will require the adoption of implementing regulations by a number of di
Slide 24: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix •Our business and operating results can also be affected by widespread disasters, terrorist activities or international hostilities, either as a result of the impact on the economy and capital and other financial markets
Slide 25: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the three months ended September 30, 2010 Net income attributable to Diluted EPS Adjustments, Income taxes common from net Average Return on In millions except per share data and percentages pretax (benefit)¹ Net income shareholders income Assets Avg. Asse
Slide 26: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the nine months ended September 30, 2010 Net income attributable to Diluted EPS Adjustments, Income taxes common from net Average Return on In millions except per share data and percentages pretax (benefit)¹ Net income shareholders income Assets Avg. Asset
Slide 27: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the three months ended Sept. 30, 2010 June 30, 2010 Mar. 31, 2010 Dec. 31, 2009 Sept. 30, 2009 In millions except ratio and per share data Total revenue $3,598 $3,912 $3,763 $4,886 $3,853 Noninterest expense 2,158 2,002 2,113 2,209 2,214 Pretax pre-provisi
Slide 28: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the year ended $ in millions 2002 2003 2004 2005 2006 2007 2008 2009 Net interest margin 3.99% 3.64% 3.22% 3.00% 2.92% 3.00% 3.37% 3.82% Provision for credit losses $309 $177 $52 $21 $124 $315 $1,517 $3,930 Avg. interest-earning assets $55,345 $55,172 $61,
Slide 29: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix For the nine months ended In millions Sept. 30, 2010 Annualized Asset management $751 $1,001 Consumer services 939 1,252 Corporate services 712 949 Residential mortgage 542 723 Service charges on deposits 573 764 Net gains on sales of securities 358 477 Net ot
Slide 30: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix In millions except per share data As of Dec. 31, 2008 As of Sept. 30, 2010 Common shareholders' equity $17,490 $29,394 Common shares outstanding 443 526 Book value per common share $39.44 $55.91 Intangible assets $11,688 $10,518 Common shareholders' equity les
Slide 31: 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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