PNC Reports Third Quarter 2016 Net Income of $1.0 Billion, $1.84 Diluted EPS

PITTSBURGH, Oct. 14, 2016

"PNC delivered another good quarter," said William S. Demchak, chairman, president and chief executive officer. "We grew revenue and managed expenses, loans and deposits increased, and capital levels were strong. Looking ahead, we continue to lay the groundwork for greater efficiencies and revenue growth to deliver positive operating leverage and create long-term shareholder value."

Income Statement Highlights
Third quarter 2016 compared with second quarter 2016

• Total revenue grew $35 million, or 1 percent, to $3.8 billion.
  • Net interest income of $2.1 billion increased $27 million, or 1 percent, due to an additional day in the quarter and higher earning assets partially offset by lower yields.  
  • Noninterest income of $1.7 billion increased $8 million driven by fee income growth.
• Noninterest expense increased $34 million, or 1 percent, to $2.4 billion reflecting business activity and included a new FDIC deposit insurance surcharge as overall expenses remained well managed.
• Provision for credit losses was $87 million, a decrease of $40 million primarily attributable to stabilization of the energy related portfolio. 

Balance Sheet Highlights

• Loans grew $1.4 billion, or 1 percent, to $210.4 billion at September 30, 2016 compared with June 30, 2016. 
  • Total commercial lending increased $1.1 billion, or 1 percent, primarily in PNC's corporate banking and real estate businesses.
  • Total consumer lending increased $.3 billion due to growth in auto, residential mortgage and credit card loans partially offset by lower home equity and education loans reflecting runoff portfolios.
• Overall credit quality remained stable with the second quarter.
  • Nonperforming assets of $2.4 billion at September 30, 2016 decreased 6 percent compared with June 30, 2016.
  • Net charge-offs increased to $154 million for the third quarter compared with $134 million for the second quarter.
• Deposits grew $10.1 billion, or 4 percent, to $259.9 billion at September 30, 2016 compared with June 30, 2016 due to growth in commercial deposits primarily attributable to seasonality.
• Investment securities of $78.5 billion at September 30, 2016 increased $6.7 billion, or 9 percent, compared with June 30, 2016 commensurate with deposit growth. 
• PNC maintained a strong liquidity position.
  • The Liquidity Coverage Ratio at September 30, 2016 exceeded 100 percent for both PNC and PNC Bank, N.A., above the 2017 fully phased-in requirement of 100 percent.
• PNC returned $.8 billion of capital to shareholders, or 85 percent of third quarter net income attributable to diluted common shares, through repurchases of 5.9 million common shares for $.5 billion and dividends on common shares of $.3 billion.
  • The August quarterly dividend on common stock reflected an 8 percent increase, or 4 cents per share, to 55 cents per share. 
• PNC maintained a strong capital position.
  • Transitional Basel III common equity Tier 1 capital ratio was an estimated 10.6 percent at both September 30, 2016 and June 30, 2016, calculated using the regulatory capital methodologies applicable to PNC during 2016.
  • Pro forma fully phased-in Basel III common equity Tier 1 capital ratio, a non-GAAP financial measure, was an estimated 10.2 percent at both September 30, 2016 and June 30, 2016 based on the standardized approach rules.

Earnings Summary ARIVA.DE Börsen-Geflüster Werbung Weiter aufwärts? Kurzfristig positionieren in PNC Financial Services Group ME9D33 Ask: 2,26 Hebel: 4,58 mit moderatem Hebel Zum Produkt Morgan Stanley Den Basisprospekt sowie die Endgültigen Bedingungen und die Basisinformationsblätter erhalten Sie hier: ME9D33,. Beachten Sie auch die weiteren Hinweise zu dieser Werbung. Der Emittent ist berechtigt, Wertpapiere mit open end-Laufzeit zu kündigen. Kurse PNC Financial Services Group 149,59 $ +1,15%
	In millions, except per share data			3Q16				2Q16				3Q15
	Net income		$	1,006			$	989			$	1,073
	Net income attributable to diluted common shares		$	913			$	914			$	987
	Diluted earnings per common share		$	1.84			$	1.82			$	1.90
	Average diluted common shares outstanding			496				503				520
	Return on average assets			1.10	%			1.11	%			1.19	%
	Return on average common equity			8.74	%			8.87	%			9.61	%
	Book value per common share  Period end		$	86.57			$	85.33			$	81.42
	Tangible book value per common share (non-GAAP)    Period end		$	67.93			$	66.89			$	63.37
	Cash dividends declared per common share		$	.55			$	.51			$	.51

The Consolidated Financial Highlights accompanying this news release include additional information regarding reconciliations of non-GAAP financial measures to reported amounts. Reference to core net interest income, a non-GAAP financial measure, is to total net interest income less purchase accounting accretion, which consists of scheduled accretion and excess cash recoveries, as detailed in the Consolidated Financial Highlights. Fee income, a non-GAAP financial measure, refers to noninterest income in the following categories: asset management, consumer services, corporate services, residential mortgage, and service charges on deposits. Information in this news release including the financial tables is unaudited.

CONSOLIDATED REVENUE REVIEW
Revenue																Change				Change
																3Q16 vs				3Q16 vs
	In millions			3Q16				2Q16				3Q15				2Q16				3Q15
	Net interest income		$	2,095			$	2,068			$	2,062				1	%			2	%
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