Pnc Financial Services Group, Inc. (the) · NYSE:PNC
Pnc Financial Services Group, Inc. (the) — CFA Society of Cleveland (February 2010)
25 slides from Pnc Financial Services Group, Inc. (the)'s conference presentation, Feb 24, 2010
Slide 1: The PNC Financial Services Group, Inc. – CFA Society of Cleveland
Exhibit 99.1 The PNC Financial Services Group, Inc. Rick Johnson Chief Financial Officer CFA Society of Cleveland February 24, 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: Today's Discussion
Today’s Discussion Overview of PNC 2009 performance review Recent events Summary 3
Slide 4: PNC's Business Model
PNC’s Business Model Overview of PNC 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 leverage while investing in innovation
Slide 5: PNC's Powerful Franchise
PNC’s Powerful Franchise Overview of PNC BlackRock (offices in 21 countries) 1 Dec. 31, 2009 U.S. Rank th Deposits $187 billion 5 th Assets $270 billion 8 CO KS th Branches 2,512 5 th OK ATMs 6,473 5 TX Retail Residential Mortgage Footprint covering nearly 1/3 of the One of the nation’s largest mort
Slide 6: PNC's Framework for Success
PNC’s Framework for Success Overview of PNC 2 PNC Peers PNC Business Dec. 31, Key Metrics Target Action Plans Model Dec. 31, 2009 2009 Loan to Maximize credit portfolio value Staying core 93% deposit ratio 84% 80%-90% Reposition deposit gathering funded (as of) strategies Provision to Focus “front d
Slide 7: A Higher Quality, Differentiated Balance Sheet
A Higher Quality, Differentiated 2009 Balance Sheet Performance Summary Dec. 31, YoY Category (billions) 2009 change Balance sheet positioning Investment securities $56 $13 Total loans 157 (18) Core funded - loan to deposit ratio Other assets 57 (16) of 84% Total assets $270 ($21) Appropriately rese
Slide 8: Relative Balance Sheet Strength
2009 Relative Balance Sheet Strength Performance Summary 4Q09 loans/deposits 4Q09 loans/assets 4Q09 comm’l real estate loans/assets JPM 68% JPM 31% JPM 3% COF 78% BAC 40% BAC 3% PNC 84% COF 53% COF 8% KEY 90% PNC 58% PNC 9% BBT 90% BBT 63% WFC 11% BAC 91% WFC 63% BBT 11% FITB 91% KEY 63% USB 12% RF
Slide 9: Pretax Pre-Provision Earnings Substantially Exceed Credit Costs
Pretax Pre-Provision Earnings Substantially 1 2009 Exceed Credit Costs Performance Summary 1 PNC full year 2009 2009 pretax pre-provision earnings /provision MTB 1.86 X 2 $17.0 Excluding GIS PNC Excluding the BLK/BGI gain 1.57x 3 1.85 $16.2 WFC 1.83 JPM 1.50 USB 1.47 $9.7 $9.0 BBT 1.37 $7.3 $7.2 COF
Slide 10: High Quality, Diverse Revenue Streams
2009 High Quality, Diverse Revenue Streams Performance Summary 2 PNC full year 2009 revenue 2009 noninterest income 1 Excluding GIS Excluding GIS and the BLK/BGI gain 1 17% $17.0 $16.2 $15.1 21% Corporate services Consumer services 16% 40% noninterest Residential Noninterest mortgage income income 2
Slide 11: Strong Loss Coverage
2009 Strong Loss Coverage Performance Summary 2009 reserves / net charge-offs 2009 reserves / total loans PNC 1.9 X JPM 4.99% MTB 1.7 FITB 4.75% BBT 1.5 COF 4.54% FITB 1.5 KEY 4.28% RF 1.4 BAC 3.94% JPM 1.4 RF 3.38% WFC 1.3 PNC 3.22% USB 1.3 WFC 2.96% CMA 1.1 STI 2.64% KEY 1.1 USB 2.54% BAC 1.1 BBT
Slide 12: Positioned to Build on Our Success
2009 Positioned to Build on Our Success Performance Summary 1 2010 expectations Net interest income and net interest margin consistent with 3Q09 annualized Lower noninterest income due to 2009 impact of MSR hedging gains Reduced expenses driven by increased acquisition cost saves and lower integrati
Slide 13: February 2010 Actions
February 2010 Actions Recent Events Redeemed $7.6 billion of PNC preferred stock held by the US Treasury - Eliminated $380 million in annual preferred dividends Reached a definitive agreement to sell PNC Global Investment Servicing for $2.3 billion - Expected $1.6 billion increase to Tier 1 common c
Slide 14: Relative Capital Positioning
Relative Capital Positioning Recent Events December 31, 2009 Tier 1 common ratio 10.7% PNC’s capital priorities 8.8% 8.5% 8.0% 8.2% 7.5% 7.7% 7.8% Maintain strong capital 7.2% 6.8% 7.0% levels 6.5% 6.0% Support our clients Invest in our businesses Return capital to shareholders when appropriate PNC
Slide 15: Summary
Summary The execution of the PNC business model resulted in exceptional 2009 performance PNC’s recent actions are consistent with PNC’s disciplined use of capital PNC’s positioning and opportunities for growth are expected to deliver significant value PNC Continues to Build a Great Company. 15
Slide 16: 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 17: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix • Legal and regulatory developments could have an impact on our ability to operate our businesses or our financial condition or results of operations or our competitive position or reputation. Reputational impacts, in tu
Slide 18: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) Appendix •Our ability to achieve anticipated results from this transaction is dependent on the state going forward of the economic and financial markets, which have been under significant stress recently. Specifically, we may inc
Slide 19: Impact of Planned Sale of GIS
1 Impact of Planned Sale of GIS Appendix Estimated gain, cash proceeds and capital enhancement (billions) Book Cash Sales price $2.3 $2.3 Less: Book equity / intercompany debt (1.5) 2 Adjustments / other (0.0) (0.2) Pretax gain 0.8 2.1 Taxes (0.3) (0.3) After tax gain / increase in cash 0.5 1.8 Elim
Slide 20: Risk-Based Capital Ratios
Risk-Based Capital Ratios Appendix 1 1 $ in billions Tier 1 common Tier 1 risk based December 31, 2009 $13.8 $26.4 Ratios 6.0% 11.5% TARP redemption 2,3 (.3) (7.6) 4 Common equity offering 3.0 3.0 5 Net impact of sale of GIS 1.6 1.6 Proforma $18.1 $23.4 Proforma ratios 8.0% 10.3% (1) Estimated. (2)
Slide 21: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix December 31, 2008 Income taxes For the three months ended, in millions Pretax (benefit) (a) Net income Reported net income (loss) ($246) National City conforming provision for credit losses $504 ($176) 328 Net income excluding National City conforming provisio
Slide 22: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix Year ended Dec. 31, 2009 Three months ended Dec. 31, 2009 Reported Reported Gain on excluding Gain on excluding BlackRock/BGI BlackRock/BGI BlackRock/BGI BlackRock/BGI in millions Reported transaction gain Reported transaction gain Net interest income $9,054 $
Slide 23: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix Three months ended Year ended March 31, 2009 June 30, 2009 Sept. 30, 2009 Dec. 31, 2009 Dec. 31, 2009 in millions Total revenue $3,871 $3,987 $4,048 $5,082 $16,988 Noninterest expense 2,328 2,658 2,379 2,369 9,734 Pretax pre-provision earnings 1,543 1,329 1,66
Slide 24: Non-GAAP to GAAP Reconcilement
Non-GAAP to GAAP Reconcilement Appendix December 31, 2009 September 30, 2009 Adjustments, Income taxes Net Diluted Adjustments, Income taxes Net Diluted For the three months ended, in millions except per share data Pretax (benefit) (a) Income EPS Pretax (benefit) (a) Income EPS Net income, as report
Slide 25: 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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