3b2b82c2b9569ce2d0a525947a7f4af63517f7cff17576f63fdf92e08675f985

PNC is one of the largest diversified financial services companies in the U.S., headquartered in Pittsburgh, Pennsylvania, with a coast-to-coast retail branch network and strategic international offices in four countries outside the U.S. The company operates through three main business segments: Retail Banking, Corporate & Institutional Banking, and Asset Management Group **[0000713676-24-000028_pnc-20231231.htm:6]** **[0000713676-24-000030_pnc2023annualreport.htm:19]** **[0000713676-24-000030_pnc2023annualreport.htm:170]** **[0000713676-24-000046_pnc-20240331.htm:103]**. PNC offers a wide range of financial products and services, including deposit accounts, lending products, investment management, and advisory services **[0000713676-24-000046_pnc-20240331.htm:103]** **[0000713676-24-000070_q32024financialsupplement.htm:14]**. Revenue is generated from net interest income and noninterest income, with significant contributions from the Corporate & Institutional Banking segment **[0000713676-24-000028_pnc-20231231.htm:160]** **[0000713676-24-000028_pnc-20231231.htm:97]** **[0000713676-24-000068_pnc-20240630.htm:26]** **[0000713676-24-000030_pnc2023annualreport.htm:109]**.

1. **Corporate & Institutional Banking** - Offers lending, treasury management, capital markets and advisory services, and commercial mortgage banking activities to mid-sized and large corporations, government, and not-for-profit entities. Provides products like secured and unsecured loans, letters of credit, and equipment leases **[0000713676-24-000046_pnc-20240331.htm:103]** **[0000713676-24-000070_q32024financialsupplement.htm:14]**.
   
2. **Retail Banking** - Provides a wide range of products and services, including deposit accounts, lending products such as residential mortgages and credit cards, brokerage, insurance services, investment management, and cash management products. These services are offered through branches, digital channels, ATMs, and phone-based customer contact centers **[0000713676-24-000046_pnc-20240331.htm:103]** **[0000713676-24-000070_q32024financialsupplement.htm:14]**.

3. **Asset Management Group** - Focuses on private banking for high net worth individuals and institutional asset management. Provides investment and retirement planning, customized investment management, credit and cash management solutions, and fiduciary services **[0000713676-24-000046_pnc-20240331.htm:103]** **[0000713676-24-000070_q32024financialsupplement.htm:14]**.

91f319c065c18c238ff4c1902ef2d7f4549c80fc84369c02c2c93ade95692aaf

Adjustments for Non-Cash Items (USD, millions)

Stock-Based Compensation (USD, millions)

Changes in Working Capital (USD, millions)

Capital Expenditures (CapEx) (USD, millions)

Proceeds from / Repayments of Debt (USD, millions)

Share Repurchases (USD, millions)

Dividend Payments (USD, millions)

Net Change in Cash (USD, millions)

bdda41d5bd552c86814f90b2eaea0ce280bf86886b38c0959b08da105c794a14

| Metric [USD Million] | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Retail Banking       | **3,079**  **[0000713676-23-000005_q42022financialsupplement.htm:15]**  | **3,024**  **[0000713676-23-000029_q12023financialsupplement.htm:14]**  | **3,150**  **[0000713676-23-000050_q22023financialsupplement.htm:15]**  | **3,360**  **[0000713676-23-000069_q32023financialsupplement.htm:16]**  | **3,391**  **[0000713676-24-000006_q42023financialsupplement.htm:16]**  | **3,381**  **[0000713676-24-000037_q12024financialsupplement.htm:15]**  | **4,118**  **[0000713676-24-000058_q22024financialsupplement.htm:16]**  | **3,484**  **[0000713676-24-000070_q32024financialsupplement.htm:15]**  |
| Corporate & Institutional Banking | **2,451**  **[0000713676-23-000005_q42022financialsupplement.htm:15]**  | **2,300**  **[0000713676-23-000029_q12023financialsupplement.htm:14]**  | **2,202**  **[0000713676-23-000050_q22023financialsupplement.htm:15]**  | **2,254**  **[0000713676-23-000069_q32023financialsupplement.htm:16]**  | **2,637**  **[0000713676-24-000006_q42023financialsupplement.htm:16]**  | **2,437**  **[0000713676-24-000037_q12024financialsupplement.htm:15]**  | **2,502**  **[0000713676-24-000058_q22024financialsupplement.htm:16]**  | **2,645**  **[0000713676-24-000070_q32024financialsupplement.htm:15]**  |
| Asset Management Group | **375**  **[0000713676-23-000005_q42022financialsupplement.htm:15]**  | **357**  **[0000713676-23-000029_q12023financialsupplement.htm:14]**  | **353**  **[0000713676-23-000050_q22023financialsupplement.htm:15]**  | **362**  **[0000713676-23-000069_q32023financialsupplement.htm:16]**  | **380**  **[0000713676-24-000006_q42023financialsupplement.htm:16]**  | **387**  **[0000713676-24-000037_q12024financialsupplement.htm:15]**  | **398**  **[0000713676-24-000058_q22024financialsupplement.htm:16]**  | **403**  **[0000713676-24-000070_q32024financialsupplement.htm:15]**  |
| Other                | **(142)**  **[0000713676-23-000005_q42022financialsupplement.htm:15]**  | **(78)**  **[0000713676-23-000029_q12023financialsupplement.htm:14]**  | **(412)**  **[0000713676-23-000050_q22023financialsupplement.htm:15]**  | **(743)**  **[0000713676-23-000069_q32023financialsupplement.htm:16]**  | **(1,047)**  **[0000713676-24-000006_q42023financialsupplement.htm:16]**  | **(1,060)**  **[0000713676-24-000037_q12024financialsupplement.htm:15]**  | **(1,607)**  **[0000713676-24-000058_q22024financialsupplement.htm:16]**  | **(1,100)**  **[0000713676-24-000070_q32024financialsupplement.htm:15]**  |
| **Total Revenue**    | **5,763**  **[0000713676-23-000005_q42022financialsupplement.htm:15]**  | **5,603**  **[0000713676-23-000029_q12023financialsupplement.htm:14]**  | **5,293**  **[0000713676-23-000050_q22023financialsupplement.htm:15]**  | **5,233**  **[0000713676-23-000069_q32023financialsupplement.htm:16]**  | **5,361**  **[0000713676-24-000006_q42023financialsupplement.htm:16]**  | **5,145**  **[0000713676-24-000037_q12024financialsupplement.htm:15]**  | **5,411**  **[0000713676-24-000058_q22024financialsupplement.htm:16]**  | **5,432**  **[0000713676-24-000070_q32024financialsupplement.htm:15]**  |

b53c5cebb9d350d45df97143e800f041e47db98d07a9b143fbf476ef10dddb75

Net outstanding standby letters of credit ($ million)

Standby bond purchase agreements ($ million)

Commitments to extend credit ($ million)

Serviced portfolio balance ($ billion)

MSR asset value ($ billion)

Fair value of commercial mortgage servicing rights ($ million)

Fair value of residential mortgage servicing rights ($ million)

Weighted-average life of commercial mortgage servicing rights (years)

Weighted-average life of residential mortgage servicing rights (years)

Weighted-average constant prepayment rate for commercial mortgage servicing rights (%)

Weighted-average constant prepayment rate for residential mortgage servicing rights (%)

Effective discount rate for commercial mortgage servicing rights (%)

Weighted-average option adjusted spread for residential mortgage servicing rights (bps)

17bc63b3ffbe70affd54c078037147045e9894fefa693efd442870e769e24f00

c8706d49dab2ac001b83aca523dc65a69d49ec454a9f28d3425f6ef665912018

| Metric (Unit) | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|---------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Net outstanding standby letters of credit ($ million) | 10,575 **[0000713676-23-000020_pnc-20221231.htm:218]** | 11,017 **[0000713676-23-000037_pnc-20230331.htm:91]** | 10,157 **[0000713676-23-000058_pnc-20230630.htm:95]** | 10,326 **[0000713676-23-000079_pnc-20230930.htm:96]** | 10,913 **[0000713676-24-000028_pnc-20231231.htm:219]** | 10,651 **[0000713676-24-000046_pnc-20240331.htm:82]** | 10,680 **[0000713676-24-000068_pnc-20240630.htm:91]** | 10,826 **[0000713676-24-000081_pnc-20240930.htm:92]** |
| Standby bond purchase agreements ($ million) | 1,208 **[0000713676-23-000020_pnc-20221231.htm:218]** | 1,193 **[0000713676-23-000037_pnc-20230331.htm:91]** | 1,184 **[0000713676-23-000058_pnc-20230630.htm:95]** | 1,088 **[0000713676-23-000079_pnc-20230930.htm:96]** | 1,078 **[0000713676-24-000028_pnc-20231231.htm:219]** | 1,194 **[0000713676-24-000046_pnc-20240331.htm:82]** | 1,167 **[0000713676-24-000068_pnc-20240630.htm:91]** | 1,055 **[0000713676-24-000081_pnc-20240930.htm:92]** |
| Commitments to extend credit ($ million) | 261,728 **[0000713676-23-000020_pnc-20221231.htm:218]** | 259,828 **[0000713676-23-000037_pnc-20230331.htm:91]** | 261,905 **[0000713676-23-000058_pnc-20230630.htm:95]** | 275,372 **[0000713676-23-000079_pnc-20230930.htm:96]** | 268,391 **[0000713676-24-000028_pnc-20231231.htm:219]** | 268,087 **[0000713676-24-000046_pnc-20240331.htm:82]** | 268,862 **[0000713676-24-000068_pnc-20240630.htm:91]** | 273,664 **[0000713676-24-000081_pnc-20240930.htm:92]** |
| Serviced portfolio balance ($ billion) | 190 **[0000713676-23-000005_q42022financialsupplement.htm:17]** | 188 **[0000713676-23-000037_pnc-20230331.htm:19]** | 191 **[0000713676-23-000058_pnc-20230630.htm:21]** | 213 **[0000713676-23-000079_pnc-20230930.htm:21]** | 209 **[0000713676-24-000006_q42023financialsupplement.htm:18]** | 207 **[0000713676-24-000037_q12024financialsupplement.htm:16]** | 204 **[0000713676-24-000058_q22024financialsupplement.htm:18]** | 200 **[0000713676-24-000070_q32024financialsupplement.htm:17]** |
| MSR asset value ($ billion) | 2.3 **[0000713676-23-000005_q42022financialsupplement.htm:17]** | 2.2 **[0000713676-23-000037_pnc-20230331.htm:19]** | 2.3 **[0000713676-23-000058_pnc-20230630.htm:21]** | 2.8 **[0000713676-23-000079_pnc-20230930.htm:21]** | 2.7 **[0000713676-24-000006_q42023financialsupplement.htm:18]** | 2.7 **[0000713676-24-000037_q12024financialsupplement.htm:16]** | 2.7 **[0000713676-24-000058_q22024financialsupplement.htm:18]** | 2.5 **[0000713676-24-000070_q32024financialsupplement.htm:17]** |
| Fair value of commercial mortgage servicing rights ($ million) | 1,113 **[0000713676-23-000020_pnc-20221231.htm:214]** | 1,061 **[0000713676-23-000037_pnc-20230331.htm:89]** | 1,106 **[0000713676-23-000058_pnc-20230630.htm:93]** | 1,169 **[0000713676-23-000079_pnc-20230930.htm:94]** | 1,032 **[0000713676-24-000028_pnc-20231231.htm:215]** | 1,075 **[0000713676-24-000046_pnc-20240331.htm:80]** | 1,082 **[0000713676-24-000068_pnc-20240630.htm:89]** | 975 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Fair value of residential mortgage servicing rights ($ million) | 2,310 **[0000713676-23-000020_pnc-20221231.htm:214]** | 2,232 **[0000713676-23-000037_pnc-20230331.htm:89]** | 2,349 **[0000713676-23-000058_pnc-20230630.htm:93]** | 2,837 **[0000713676-23-000079_pnc-20230930.htm:94]** | 2,654 **[0000713676-24-000028_pnc-20231231.htm:215]** | 2,687 **[0000713676-24-000046_pnc-20240331.htm:80]** | 2,657 **[0000713676-24-000068_pnc-20240630.htm:89]** | 2,528 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Weighted-average life of commercial mortgage servicing rights (years) | 4.0 **[0000713676-23-000020_pnc-20221231.htm:214]** | 3.9 **[0000713676-23-000037_pnc-20230331.htm:89]** | 3.9 **[0000713676-23-000058_pnc-20230630.htm:93]** | 4.0 **[0000713676-23-000079_pnc-20230930.htm:94]** | 3.9 **[0000713676-24-000028_pnc-20231231.htm:215]** | 3.9 **[0000713676-24-000046_pnc-20240331.htm:80]** | 3.9 **[0000713676-24-000068_pnc-20240630.htm:89]** | 3.8 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Weighted-average life of residential mortgage servicing rights (years) | 8.0 **[0000713676-23-000020_pnc-20221231.htm:214]** | 7.7 **[0000713676-23-000037_pnc-20230331.htm:89]** | 7.8 **[0000713676-23-000058_pnc-20230630.htm:93]** | 8.4 **[0000713676-23-000079_pnc-20230930.htm:94]** | 8.1 **[0000713676-24-000028_pnc-20231231.htm:215]** | 8.1 **[0000713676-24-000046_pnc-20240331.htm:80]** | 8.1 **[0000713676-24-000068_pnc-20240630.htm:89]** | 7.8 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Weighted-average constant prepayment rate for commercial mortgage servicing rights (%) | 4.28 **[0000713676-23-000020_pnc-20221231.htm:214]** | 4.39 **[0000713676-23-000037_pnc-20230331.htm:89]** | 4.38 **[0000713676-23-000058_pnc-20230630.htm:93]** | 5.42 **[0000713676-23-000079_pnc-20230930.htm:94]** | 5.51 **[0000713676-24-000028_pnc-20231231.htm:215]** | 5.24 **[0000713676-24-000046_pnc-20240331.htm:80]** | 5.30 **[0000713676-24-000068_pnc-20240630.htm:89]** | 4.41 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Weighted-average constant prepayment rate for residential mortgage servicing rights (%) | 6.72 **[0000713676-23-000020_pnc-20221231.htm:214]** | 7.22 **[0000713676-23-000037_pnc-20230331.htm:89]** | 6.91 **[0000713676-23-000058_pnc-20230630.htm:93]** | 5.77 **[0000713676-23-000079_pnc-20230930.htm:94]** | 6.42 **[0000713676-24-000028_pnc-20231231.htm:215]** | 6.29 **[0000713676-24-000046_pnc-20240331.htm:80]** | 6.25 **[0000713676-24-000068_pnc-20240630.htm:89]** | 7.21 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Effective discount rate for commercial mortgage servicing rights (%) | 9.77 **[0000713676-23-000020_pnc-20221231.htm:214]** | 9.54 **[0000713676-23-000037_pnc-20230331.htm:89]** | 9.89 **[0000713676-23-000058_pnc-20230630.htm:93]** | 10.22 **[0000713676-23-000079_pnc-20230930.htm:94]** | 9.64 **[0000713676-24-000028_pnc-20231231.htm:215]** | 9.94 **[0000713676-24-000046_pnc-20240331.htm:80]** | 9.98 **[0000713676-24-000068_pnc-20240630.htm:89]** | 10.69 **[0000713676-24-000081_pnc-20240930.htm:90]** |
| Weighted-average option adjusted spread for residential mortgage servicing rights (bps) | 766 **[0000713676-23-000020_pnc-20221231.htm:214]** | 768 **[0000713676-23-000037_pnc-20230331.htm:89]** | 767 **[0000713676-23-000058_pnc-20230630.htm:93]** | 765 **[0000713676-23-000079_pnc-20230930.htm:94]** | 765 **[0000713676-24-000028_pnc-20231231.htm:215]** | 766 **[0000713676-24-000046_pnc-20240331.htm:80]** | 764 **[0000713676-24-000068_pnc-20240630.htm:89]** | 755 **[0000713676-24-000081_pnc-20240930.htm:90]** |

939754baf94219cd98dff4d2c1b0b08bd8762b3bbe44fd79005d24f431dc2972

e11e39a6738c0619092299350171cafc3c0f7438685ce6077dbdd0f0c0326f21

1. Given the continued stress in your CRE office portfolio, with nonperforming loans increasing due to the migration of criticized loans and expectations of additional charge-offs, how confident are you that your current reserves of **11.3% on the overall office portfolio** and **16% on the multi-tenant portfolio** are sufficient to cover future losses, and what strategies are you implementing to mitigate these risks?  **[PNC_3402827_4]** 
2. With noninterest expenses expected to rise by **2% to 3%** in the fourth quarter and fee income projected to decline by **5% to 7%**, what specific measures are you taking to manage expenses and drive revenue growth to achieve positive operating leverage for the full year?  **[PNC_3402827_4]** 
3. You've mentioned plans to invest in your retail distribution by building high-volume branches, particularly in the Southwest markets. In an era where digital banking is becoming more prevalent, how do you justify this strategy, and what returns on investment do you anticipate from these branch expansions?  **[PNC_3402827_23]** 
4. Historically, you've been underpenetrated in consumer lending, especially in credit cards. Despite recent investments and new product introductions, when do you expect to see significant growth and a measurable impact on your consumer lending revenues?  **[PNC_3402827_11]** **[PNC_3402827_10]** 
5. Considering your expectation that the Fed will cut rates twice in 2024 and your projections of achieving record net interest income in 2025 without relying on loan growth, what gives you confidence in these projections amid economic uncertainties, and what key factors are driving this confidence?  **[PNC_3402827_4]** **[PNC_3402827_16]** 

c82fd4581b0c9ace70651bce085b62410230ebac379c386a9255db956caa1c4d

Total Revenue (USD, millions)

Cost of Goods Sold (COGS) (USD, millions)

SG&A (USD, millions)

R&D (USD, millions)

Depreciation and Amortization (USD, millions)

Interest Expense (USD, millions)

Operating Income (EBIT) (USD, millions)

Net Income (USD, millions)

EPS - Basic (USD/share)

EPS - Diluted (USD/share)

aa2d2290e5f238eb189f5fa16107b5dc7d0e7cd3c5efb22b3e6bfd414e71d3b6

PNC expects deposit growth of 1-2% in 2025, 6-7% NII growth for FY25, and NIM near 3% by year-end. Despite uncertain loan growth and rising private credit competition, strong capital ratios support $100-$200M quarterly buybacks, signaling ongoing investor confidence.

3832bf1d3a5dcbdb70b2784349abb1334c4d5768d904949d727b54fbaaacbe77

Americas

Europe

Asia-Pacific

Total Revenue

e875179bf85021c11f201132cc12814ead7cb4f3011721a9fdbcc98f9d3fe3cf

205e79586eadf7592a21b07dfd254b464d6eb2ad8efb36710a65f2ed2111b66d

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: Q4 2024
- **Guidance**:
  - **Economic Outlook**:
    - Real GDP growth of approximately **2%** in 2024.
    - Unemployment slightly above **4%** through year-end.
    - Federal Reserve rate cuts: **25 basis point decrease** in November and December.
  - **Financial Metrics**:
    - **Average Loans**: Stable.
    - **Net Interest Income**: Up approximately **1%**.
    - **Fee Income**: Down **5% to 7%**.
    - **Other Noninterest Income**: **$150 million to $200 million**, excluding Visa activity.
    - **Total Revenue**: Stable.
    - **Total Noninterest Expense**: Up **2% to 3%**.
    - **Net Charge-Offs**: Approximately **$300 million**.
  - **Operating Leverage**: On track for full-year positive operating leverage.
  - **Capital Markets and Fee Guidance**: Fee income decline driven by elevated MSR levels and capital markets activity  **[PNC_3402827_4]** **[PNC_3402827_7]** .

### Q2 2024 Earnings Call
- **Issued Period**: Q2 2024
- **Guided Period**: Q3 2024 and FY 2024
- **Guidance**:
  - **Overall Economy**:
    - Real GDP growth of approximately **2%** in 2024.
    - Unemployment slightly above **4%** by year-end.
    - Federal Reserve rate cuts: **25 basis point decrease** in September and December.
  - **Third Quarter 2024**:
    - **Average Loans**: Stable.
    - **Net Interest Income**: Up **1% to 2%**.
    - **Fee Income**: Up **1% to 2%**.
    - **Other Noninterest Income**: **$150 million to $200 million**, excluding Visa and securities activity.
    - **Core Noninterest Expense**: Up **3% to 4%**.
    - **Net Charge-Offs**: **$250 million to $300 million**.
  - **Full Year 2024**:
    - **Average Loans**: Down less than **1%** compared to 2023.
    - **Net Interest Income**: Down approximately **4%**.
    - **Noninterest Income**: Up **3% to 5%**.
    - **Total Revenue**: Down **1% to 2%**.
    - **Core Noninterest Expense**: Down approximately **1%**.
    - **Effective Tax Rate**: Approximately **18.5%**  **[PNC_3393373_5]** .

### Q1 2024 Earnings Call
- **Issued Period**: Q1 2024
- **Guided Period**: FY 2024
- **Guidance**:
  - **Full Year 2024**:
    - **Average Loan Growth**: Approximately **1%**.
    - **Total Revenue**: Stable to down **2%**.
      - **Net Interest Income**: Down **4% to 5%**.
      - **Noninterest Income**: Up **4% to 6%**.
    - **Core Noninterest Expense**: Stable, excluding FDIC assessment.
    - **Effective Tax Rate**: Approximately **18.5%**.
  - **Second Quarter 2024**:
    - **Average Loans**: Stable.
    - **Net Interest Income**: Down approximately **1%**.
    - **Fee Income**: Up **1% to 2%**.
    - **Other Noninterest Income**: **$150 million to $200 million**, excluding Visa activity.
    - **Total Revenue**: Stable.
    - **Total Core Noninterest Expense**: Up **2% to 4%**.
    - **Net Charge-offs**: **$225 million to $275 million**.
  - **Economic Outlook**:
    - Real GDP growth of approximately **2%**.
    - Unemployment rate increase to **4%** by year-end.
    - Federal Reserve rate cuts: **25 basis point decrease** in July and November  **[PNC_3379859_5]** .

### Q4 2023 Earnings Call
- **Issued Period**: Q4 2023
- **Guided Period**: Q1 2024 and FY 2024
- **Guidance**:
  - **Spot Loan Growth**: **3% to 4%**, equating to average loan growth of approximately **1%**.
  - **Operating Leverage**: About **100 basis points negative**.
  - **Net Interest Income**: Down **4% to 5%**.
  - **Noninterest Income**: Up **4% to 6%**.
  - **Total Revenue**: Stable to down **2%**.
  - **Core Noninterest Expense**: Stable, excluding FDIC assessment.
  - **Effective Tax Rate**: Approximately **18.5%**.
  - **Credit Metrics**: Stress in CRE office portfolio, reserves at **8.7%** of total office loans and **12.9%** on multi-tenant portfolio.
  - **Federal Funds Rate**: Unchanged between **5.25% and 5.5%** through mid-2024, with a **75 basis points** reduction expected.
  - **Economic Outlook**: Mild recession expected in mid-2024 with GDP contraction of less than **1%**  **[PNC_3370280_4]** **[PNC_3370280_3]** .

a5f4f39fbef4412e41f9efa56a1b3d93245537a3155c3e06bae06678f8c12799

| Name                  | Position                                                                 | Start Date       | Short Bio                                                                                                                                                                                                 |
|-----------------------|--------------------------------------------------------------------------|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Carole L. Brown       | Executive Vice President and Head of Asset Management Group              | July 2020        | Carole L. Brown joined PNC in 2019 and was appointed to her current position in July 2020. Previously, she was the Chief Change and Risk Officer for PNC's Asset Management Group and Corporate & Institutional Banking  **[0000713676-24-000028_pnc-20231231.htm:71]** **[0000713676-24-000030_pnc2023annualreport.htm:82]** .                   |
| Richard K. Bynum      | Executive Vice President and Chief Corporate Responsibility Officer      | July 2020        | Richard K. Bynum has been with PNC since 2005. He was appointed to his current role in July 2020, after serving as the regional president for PNC's Greater Washington market from 2017 to 2020  **[0000713676-24-000028_pnc-20231231.htm:71]** **[0000713676-24-000030_pnc2023annualreport.htm:83]** .                                          |
| William S. Demchak    | Chairman and Chief Executive Officer                                     | April 2013       | William S. Demchak joined PNC in 2002 as CFO. He became CEO in April 2013 and Chairman in April 2014. He served as President from April 2012 through February 2024  **[0001193125-24-066850_d540496ddef14a.htm:13]** **[0001193125-23-070779_d377505ddef14a.htm:12]** .                                                                       |
| Kieran J. Fallon      | Executive Vice President and Chief Risk Officer                          | February 2021    | Kieran J. Fallon joined PNC in 2011 and was appointed Chief Risk Officer in February 2021. He previously served as Senior Deputy General Counsel  **[0000713676-24-000030_pnc2023annualreport.htm:83]** **[0000713676-24-000028_pnc-20231231.htm:71]** .                                                                                         |
| Deborah Guild         | Executive Vice President and Head of Enterprise Technology and Security  | December 2020    | Deborah Guild joined PNC in October 2013 and has held roles as Chief Information Security Officer, Chief Security Officer, and Chief Technology Officer before her current position  **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-24-000030_pnc2023annualreport.htm:83]** **[0000713676-24-000028_pnc-20231231.htm:71]** .                                                   |
| Vicki C. Henn         | Executive Vice President and Chief Human Resources Officer               | July 2014        | Vicki C. Henn joined PNC in 1994 and has held numerous management positions. She was appointed to her current role in July 2014  **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-23-000020_pnc-20221231.htm:76]** .                                                                                                          |
| Gregory B. Jordan     | Executive Vice President, General Counsel and Chief Administrative Officer | February 2016 | Gregory B. Jordan joined PNC in 2013 as Executive Vice President, General Counsel, and Head of Regulatory and Government Affairs. He became Chief Administrative Officer in February 2016  **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-23-000020_pnc-20221231.htm:76]** .                                               |
| Stacy M. Juchno       | Executive Vice President and General Auditor                             | April 2014       | Stacy M. Juchno has served as Executive Vice President and General Auditor since April 2014. Previously, she was the Senior Vice President and Finance Governance and Oversight Director  **[0000713676-24-000030_pnc2023annualreport.htm:83]** **[0000713676-24-000028_pnc-20231231.htm:71]** **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-23-000020_pnc-20221231.htm:76]** .                                           |
| Ganesh Krishnan       | Executive Vice President and Enterprise Chief Information Officer        | November 2020    | Ganesh Krishnan joined PNC in 2008 and has held various technology leadership roles. He was appointed to his current position in November 2020  **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-23-000026_corpcomm1122-0292022annu.htm:81]** **[0000713676-23-000020_pnc-20221231.htm:76]** .                                                                                       |
| Michael P. Lyons      | President and Head of Corporate & Institutional Banking                  | February 2024    | Michael P. Lyons joined PNC in October 2011 as an Executive Vice President. He was appointed President and Head of Corporate & Institutional Banking in February 2024  **[0000713676-24-000030_pnc2023annualreport.htm:83]** **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-24-000028_pnc-20231231.htm:71]** .                                                                |
| Alexander E. C. Overstrom | Executive Vice President and Head of Retail Banking                  | July 2022        | Alexander E. C. Overstrom joined PNC in 2014 and has held various management positions. He was appointed to his current role in July 2022  **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-24-000030_pnc2023annualreport.htm:83]** **[0000713676-24-000028_pnc-20231231.htm:71]** **[0000713676-23-000020_pnc-20221231.htm:76]** .                                                                                         |
| E William Parsley, III | Executive Vice President and Chief Operating Officer                    | February 2018    | E William Parsley, III joined PNC in 2003 and has held various leadership roles. He was appointed Chief Operating Officer in February 2018  **[0000713676-24-000030_pnc2023annualreport.htm:83]** **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-24-000028_pnc-20231231.htm:71]** **[0000713676-23-000020_pnc-20221231.htm:76]** **[0000713676-23-000026_corpcomm1122-0292022annu.htm:79]** .                                                                                     |
| Robert Q. Reilly      | Executive Vice President and Chief Financial Officer                     | 2013             | Robert Q. Reilly has been with PNC since 1987. He was appointed CFO in 2013 after serving as Head of PNC's Asset Management Group from 2005 until April 2013  **[0000713676-24-000028_pnc-20231231.htm:71]** **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-24-000030_pnc2023annualreport.htm:84]** .                                                                          |
| Gregory H. Kozich     | Senior Vice President and Controller                                     | 2011             | Gregory H. Kozich joined PNC in 2010 and was appointed Controller in 2011. He became Senior Vice President in 2010  **[0000713676-24-000030_pnc2023annualreport.htm:84]** **[0000713676-24-000028_pnc-20231231.htm:72]** **[0000713676-23-000020_pnc-20221231.htm:76]** .                                                                                                                   |

22e18ed9d651540119c5ef2f756483d316a4f2d980755fdbb58061e291c90485

| Program Details          | Program 1          |
|--------------------------|--------------------|
| Approval Date            | N/A                |
| End Date/Duration        | N/A                |
| Total additional amount  | **100 million shares**  **[0000713676-24-000081_pnc-20240930.htm:132]** **[0000713676-24-000081_pnc-20240930.htm:10]**  |
| Remaining authorization  | **43% of 100 million shares**  **[0000713676-24-000081_pnc-20240930.htm:132]** **[0000713676-24-000081_pnc-20240930.htm:10]**  |
| Details                  | Allows capital return in excess of SCB minimum levels; flexibility in capital management; cautious approach due to Basel III adjustments  **[0000713676-24-000081_pnc-20240930.htm:132]**  |

c4c9ac40249653d57baa7dd3692d9033e89945cbbb61f36a884b21199b9a10a6

**Quarterly guidance for Q1 2025:**
- **Average Loans**: down approximately 1%  **[PNC_3412701_4]**  (lowered from stable  **[PNC_3402827_4]** **[PNC_3402827_7]** )  
- **Net Interest Income**: down 2% to 3%  **[PNC_3412701_4]**  (lowered from up approximately 1%  **[PNC_3402827_4]** **[PNC_3402827_7]** )  
- **Fee Income**: stable  **[PNC_3412701_4]**  (raised from down 5% to 7%  **[PNC_3402827_4]** **[PNC_3402827_7]** )  
- **Other Noninterest Income**: $150 million to $200 million  **[PNC_3412701_4]**  (no change from prior guidance  **[PNC_3402827_4]** **[PNC_3402827_7]** )  
- **Total Revenue**: down 1% to 2%  **[PNC_3412701_4]**  (lowered from stable  **[PNC_3402827_4]** **[PNC_3402827_7]** )  
- **Noninterest Expense**: down 2% to 3%  **[PNC_3412701_4]**  (lowered from up 2% to 3%  **[PNC_3402827_4]** **[PNC_3402827_7]** )  
- **Net Charge-Offs**: $300 million  **[PNC_3412701_4]**  (no change from prior guidance  **[PNC_3402827_4]** **[PNC_3402827_7]** )  

**Annual guidance for FY 2025:**
- **Loan Growth**: Spot loan growth of 2% to 3%  **[PNC_3412701_4]**  (no prior guidance)  
- **Total Revenue**: up approximately 6%  **[PNC_3412701_4]**  (no prior guidance)  
  - **Net Interest Income (NII)**: up 6% to 7%  **[PNC_3412701_4]**  (no prior guidance)  
  - **Noninterest Income**: up approximately 5%  **[PNC_3412701_4]**  (no prior guidance)  
- **Noninterest Expense**: up approximately 1%  **[PNC_3412701_4]**  (no prior guidance)  
- **Effective Tax Rate**: approximately 19%  **[PNC_3412701_4]**  (no prior guidance)  
- **Operating Leverage**: substantial positive  **[PNC_3412701_4]**  (raised from on track for full-year positive operating leverage  **[PNC_3402827_4]** **[PNC_3402827_7]** )  

d211028f71999645230b718490137120321eb5e235c32c62b5b63f5284cac776

| Name                        | Start Date | End Date | Reason for Change |
|-----------------------------|------------|----------|-------------------|
| PricewaterhouseCoopers LLP | 2007  **[0000713676-24-000028_pnc-20231231.htm:152]**    | Present  | Current auditor   |

a3a714cf4b0b43a2421be4e627f2ac720a9f6dcb01426056a80a95a7ca569e08

| Year       | Amount Due [Billions] | Debt Type                     | Interest Rate [%] | % of Total Debt                                                                 |
|------------|-----------------------|-------------------------------|-------------------|---------------------------------------------------------------------------------|
| 2024       | 0.2                  | Senior Floating Rate Bank Notes | N/A               | 0.3% = (0.2 / 68.069) * 100 **[0000713676-24-000081_pnc-20240930.htm:124]** **[0000713676-24-000081_pnc-20240930.htm:62]**                                    |
| 2025       | 1.0                  | Senior Fixed-to-Floating Rate Notes | N/A           | 1.5% = (1.0 / 68.069) * 100 **[0000713676-24-000081_pnc-20240930.htm:124]** **[0000713676-24-000081_pnc-20240930.htm:62]**                                    |
| 2032       | 1.5                  | Senior Fixed-to-Floating Rate Notes | 4.812          | 2.2% = (1.5 / 68.069) * 100 **[0000713676-24-000081_pnc-20240930.htm:124]** **[0000713676-24-000081_pnc-20240930.htm:62]**                                    |
| N/A        | 28.0                 | Federal Home Loan Bank Borrowings | N/A             | 41.1% = (28.0 / 68.069) * 100 **[0000713676-24-000081_pnc-20240930.htm:62]**                                          |
| N/A        | 32.5                 | Senior Debt                   | N/A               | 47.8% = (32.5 / 68.069) * 100 **[0000713676-24-000081_pnc-20240930.htm:62]**                                          |
| N/A        | 4.2                  | Subordinated Debt             | N/A               | 6.2% = (4.2 / 68.069) * 100 **[0000713676-24-000081_pnc-20240930.htm:62]**                                            |

c6f87f2f019656cddbea241fc8f1804e27445e4ed3fd6fbc88c6332dfcf43aec

33e42f688a48749de4974d109ec0139275dcdb2b98e7296d986776bc90ecd18b

431258e1628205fd3ea683fc1733202376ed3e26bd0576aa0d7f2c22bb0d0030

1. **Loan Growth Outlook**  
   **Q:** What's causing the lack of loan growth?  
   **A:** Utilization is lower across all subsegments due to total cost and uncertainty. We're growing clients and commitments, but without visibility on when demand will pick up, we're being conservative and not forecasting loan growth numbers.  **[PNC_3412701_13]** 

2. **Net Interest Margin Guidance**  
   **Q:** Can you achieve 3% NIM by year-end?  
   **A:** Yes, we expect NIM to continue increasing through 2025 and approach **3%** by the end of the year. We've approached that level in the past and find it logical to assume we'll get close to it again.  **[PNC_3412701_9]** 

3. **Net Interest Income Drivers**  
   **Q:** How will NII grow over the year?  
   **A:** Our full-year NII guidance is conservative, assuming stable average loans and spot loans up 2-3%. NII will be down 2-3% in Q1 due to fewer days and seasonal deposit declines but is expected to grow **6-7%** for the year as fixed-rate assets reprice.  **[PNC_3412701_6]** 

4. **Asset Quality and Reserves**  
   **Q:** What's the outlook for office portfolio reserves?  
   **A:** We're adequately reserved for the office portfolio. While there are some moving parts, outstandings are coming down, and charge-offs decreased in Q4. We remain cautious due to a lack of a stabilized market but expect more charge-offs as we work through it.  **[PNC_3412701_21]** 

5. **Fee Income Growth**  
   **Q:** What drives the 5% fee income growth outlook?  
   **A:** We expect asset management fees up mid-single digits, capital markets and advisory fees up mid-to-high single digits, and card and treasury management fees up mid-to-high single digits. Mortgage fees are expected to decline about **10%**, but it's a small component.  **[PNC_3412701_11]** 

6. **Liquidity Management**  
   **Q:** Are you leaving money on the table by keeping liquidity at the Fed?  
   **A:** If we were certain there'd be no loan growth, we'd redeploy cash for higher yields. There's interplay not reflected in our guidance; we remain optimistic about loan demand and may adjust our liquidity position accordingly.  **[PNC_3412701_16]** 

7. **Capital Return**  
   **Q:** Can you sustain $200 million in quarterly buybacks?  
   **A:** Yes, we plan to continue repurchasing shares at **$100-$200 million** per quarter, even if loan growth picks up from our conservative expectations. This level is sustainable and aligns with our capital strategy.  **[PNC_3412701_12]** 

8. **Hedging Strategy**  
   **Q:** How are you using forward starting swaps?  
   **A:** We're using forward starting swaps to lock in rates on maturing fixed-rate assets, ensuring stability in our NII. We'll continue this strategy into 2026 and 2027 as opportunities arise, providing a buffer against rate movements.  **[PNC_3412701_22]** 

9. **Expense Growth and Investment**  
   **Q:** Is 3% expense growth a sustainable run rate?  
   **A:** Yes, expenses up **3%** is typical and reflects our investments in new branches, technology, and data centers to accelerate organic growth. These are strategic investments aimed at generating future returns.  **[PNC_3412701_25]** 

10. **M&A Opportunities**  
    **Q:** What's the outlook for transformational M&A?  
    **A:** While it's possibly easier to get deals approved now, everyone wants to be an acquirer and no one is selling. Structural issues suggest consolidation is logical, but we don't see opportunities currently and won't force an outcome.  **[PNC_3412701_26]** 

e39fba9392715ed0344f639329d061c0966b69098d8a3691effcf2b1d2b48f86

- PNC expects **deposit growth of 1% to 2% in 2025**, and is successfully growing deposits in expansion markets, with strong **DDA growth**.  **[PNC_3412701_5]**
- PNC has **strong capital ratios** that are expected to continue to build off already high levels, despite **sluggish loan growth** and **share buyback assumptions**, indicating financial strength and the ability to return capital to shareholders.  **[PNC_3412701_23]**
- PNC has a strong position in **asset-backed lending** with limited competition, as entering this business requires significant operational capabilities, making it difficult for new entrants.  **[PNC_3412701_18]**

1b973b0953b07326a94d77fe4cd9ef5753079f47378c642f889cb56597cd2b7b

- PNC **increased its expense savings target** for 2024 from **$425 million** to **$450 million**, demonstrating strong expense discipline.  **[PNC_3393373_23]**
- The company expects to achieve **record Net Interest Income in 2025** without needing further restructuring, reflecting confidence in their growth trajectory.  **[PNC_3393373_6]**
- PNC is enhancing its credit card offerings to **improve penetration among existing clients**, capitalizing on being underpenetrated relative to industry averages, presenting a significant growth opportunity.  **[PNC_3393373_28]**

66f08ee82e7939721b0b875d8cbb358a848c7a7caa67de9c740c0cb827a9a7b4

- Management expresses uncertainty regarding loan growth, with CEO William Demchak stating he is **"befuddled"** by persistent low loan utilization rates, and admitting that they have **no loan growth** factored into projections for record NII in 2025.  **[PNC_3402827_17]** **[PNC_3402827_16]**
- The bank anticipates additional **charge-offs in the CRE office portfolio**, acknowledging that lower cap rates may not sufficiently improve valuations for severely under-occupied office buildings, which could significantly impact asset quality.  **[PNC_3402827_26]**
- In the C&I loan portfolio, management notes that there are more **downgrades than upgrades**, driven by **margin compression** among borrowers, suggesting weakening financial conditions that could lead to higher future credit losses.  **[PNC_3402827_24]**

35b880f71e21681e38e90b54615e39b664968481598a4cdd1c180df63c1887a3

- **Uncertainty in Loan Growth Prospects:** PNC executives expressed uncertainty regarding future loan growth, noting that **loan utilization rates are lower across all subsegments**, including small commercial, middle market, and specialty businesses. They admitted that they are not forecasting significant loan growth and are unsure when it might occur, which could impact net interest income growth.  **[PNC_3412701_3]**
- **Increased Competition from Private Credit:** The rise of private credit funds is leading to heightened competition for lending opportunities. PNC acknowledges that while they haven't lost desired deals, they are facing situations where **they cannot compete on terms offered by private credit providers**. This competition at the margin could pressure loan volumes and pricing.  **[PNC_3412701_17]**
- **Average Online and Mobile Banking Experience:** PNC's online and mobile banking offerings are currently **only average**, as admitted by their executive, which may affect customer satisfaction and competitiveness. While they are investing to improve, the need to catch up may require significant resources and time, potentially impacting profitability.  **[PNC_3412701_20]**

e717bc5ac32da89dda857a3f801505b29e26c1d2e831457a56adbbf0d27d61df

- **PNC expects Net Interest Income (NII) to trough in Q2 and grow thereafter**, driven by the **repricing of fixed-rate assets**, leading to improved NII in the second half of the year.  **[PNC_3379859_6]**
- **PNC has reiterated that 2025 Net Interest Income will reach a record level**, indicating strong future earnings potential, with the only significant risk being **a massive curve inversion causing lower yields**.  **[PNC_3379859_12]**
- **PNC is successfully managing expenses, achieving $750 million of cost savings for 2024**, already ahead of expectations in the first quarter, **projecting stable expenses year-over-year**, potentially leading to positive operating leverage.  **[PNC_3379859_24]**

25989eec1759c96ab031d79174f8f89417830696014aa9528d8bfb98a520c1d6

1. **Net Interest Income Outlook**  
   **Q:** Will NII improve after troughing in Q2?  
   **A:** Management expects NII to trough in the second quarter and then grow, driven primarily by the repricing of fixed-rate assets as rates settle down. Loan growth will contribute but isn't expected to be significant.  **[PNC_3379859_6]** 

2. **2025 Record NII Expectation**  
   **Q:** Do you still expect record NII in 2025?  
   **A:** Yes, management reiterates that **2025 will be a record year for NII**. The largest risk to this outlook would be a significant curve inversion resulting in lower yields when repricing fixed-rate securities, but current assumptions keep them on track.  **[PNC_3379859_11]** **[PNC_3379859_12]** 

3. **Loan Growth and Economic Risks**  
   **Q:** Could higher rates and no rate cuts lead to economic decline and impact loan growth?  
   **A:** Management acknowledges the possibility that "higher for longer" rates could tip the economy into recession, which could impact loan growth. However, they believe a soft landing is still the base case, and utilization rates could even increase if credit conditions tighten.  **[PNC_3379859_16]** **[PNC_3379859_17]** 

4. **Credit Quality in Commercial Real Estate**  
   **Q:** Are you seeing stress in CRE, specifically office, and how are you provisioning?  
   **A:** The pressure is in the CRE book, particularly the office sector. They've prudently added to the office reserve with no surprises in credit migration. Reappraisals have shown declines much higher than **15%**, in some cases up to **30%-40%** or more. They feel well-reserved and ahead of the issue.  **[PNC_3379859_9]** **[PNC_3379859_10]** **[PNC_3379859_14]** **[PNC_3379859_25]** 

5. **Capital Management and Visa Proceeds**  
   **Q:** How are you thinking about capital build and use of Visa B shares proceeds?  
   **A:** They plan to gradually build capital from current levels, considering potential regulatory changes like Basel III endgame. On May 3, they can monetize **50%** of their Visa B shares, representing about **$800 million** in unrealized gains, and will consider how to apply this excess capital when received.  **[PNC_3379859_20]** **[PNC_3379859_27]** 

6. **Expense Management and Operating Leverage**  
   **Q:** Can you achieve positive operating leverage this year given expense control efforts?  
   **A:** Achieving positive operating leverage for the full year is challenging due to NII and rate issues, excluding any Visa gains. However, they feel good about expenses, projecting stable expenses year-over-year and are off to a good start realizing benefits from cost-saving actions.  **[PNC_3379859_8]** **[PNC_3379859_24]** 

7. **M&A Outlook**  
   **Q:** Do you see bank M&A activity picking up before elections?  
   **A:** Management believes most banks are likely to hold off on M&A in the near term as their earnings are expected to improve with normalizing rates. Significant deal-making is unlikely before the elections.  **[PNC_3379859_18]** 

8. **Fee Income and Capital Markets**  
   **Q:** How is the outlook for capital markets and fee income growth?  
   **A:** They are maintaining an expectation of **20%** growth in capital markets fees year-over-year. While the first quarter was softer compared to an elevated fourth quarter, a strong pipeline, particularly at Harris Williams, suggests improvement in the coming quarters.  **[PNC_3379859_21]** 

9. **Asset and Wealth Management Growth**  
   **Q:** Any updates on asset and wealth management growth?  
   **A:** The business is performing well, supported by equity markets. They've successfully repositioned in the market, seeing asset inflows and new business wins, especially in the Southwest markets from the BBVA acquisition where wealth management services are newly introduced.  **[PNC_3379859_22]** 

10. **Impact of Rates on Other CRE Sectors**  
    **Q:** Will higher rates impact other areas of commercial real estate?  
    **A:** Higher rates may affect other CRE sectors at the margin as debt service coverage ratios decline with rising interest costs. However, these assets are generally cash-flowing, unlike many office properties, so the impact is expected to be limited.  **[PNC_3379859_26]** 

47788bd1fdc378c7102d264921a24a26396042c6b7d07b78b49ff5cc8a3361db

- **PNC expects continued growth in capital markets and advisory fees in 2024**, with strong pipelines and quarterly revenues anticipated to be in the range of the first and fourth quarters of 2023.  **[PNC_3370280_26]** **[PNC_3370280_7]**
- **The bank anticipates loan growth in 2024**, expecting average loans to increase 1% and spot loans to rise 3% to 4%, primarily driven by commercial lending in the latter half of the year.  **[PNC_3370280_5]**
- **PNC is maintaining expense discipline**, targeting stable expenses for 2024 even as it continues to invest in key growth initiatives, positioning itself to achieve its financial targets.  **[PNC_3370280_8]**

9dd20694ce63e0ffede3e0ba0aa1322cd80617f9498d9b5918f5a800e9ab3e23

- **PNC is experiencing subdued loan growth**, and management has muted its loan growth assumptions for the second half of the year due to a lack of evidence of growth, which could impact future net interest income.  **[PNC_3393373_23]**   **[PNC_3393373_24]**   **[PNC_3393373_8]**
- **Increased charge-offs in the CRE office portfolio are expected to continue**, with $106 million in net charge-offs during the second quarter and anticipation of additional charge-offs, pointing to potential ongoing credit issues in this segment.  **[PNC_3393373_5]**   **[PNC_3393373_32]**
- **Despite initiatives to improve net interest income and expense control, PNC is still guiding to negative operating leverage for 2024**, indicating that earnings growth may be constrained even with positive factors like an improving net interest margin.  **[PNC_3393373_23]**   **[PNC_3393373_6]**   **[PNC_3393373_8]**

b949bc4fd65054330db8bb44addd63b2216abb33230a73d7b82656fdb7d1ab59

1. **Record NII in 2025**  
   **Q:** Will you achieve record net interest income in 2025?  
   **A:** We feel confident we'll achieve **record net interest income** in 2025, and this is not dependent on loan growth.  **[PNC_3402827_16]** 

2. **Net Interest Margin Outlook**  
   **Q:** Where will net interest margin normalize?  
   **A:** Our net interest margin is increasing, and we expect it to approach **3%** over time.  **[PNC_3402827_9]** 

3. **Loan Growth Expectations**  
   **Q:** When will loan growth pick up?  
   **A:** Loan growth has been lower than expected due to low utilization and a pause with the upcoming election and rate environment. We continue to add customers and loan commitments, and we expect loan growth is not too far off.  **[PNC_3402827_7]** 

4. **Deposit Cost Decline**  
   **Q:** Will deposit costs decrease soon?  
   **A:** We're in a down beta cycle and expect our terminal beta to be approximately **50%**. Rates paid will come down, particularly in higher interest-bearing commercial and wealth deposits.  **[PNC_3402827_20]** 

5. **Office CRE Reserves**  
   **Q:** Why are office CRE reserves increasing?  
   **A:** We're just now starting to see buildings clear in sales, and challenges in the office sector will play out over a long period. It's early innings, and we expect it to be noisy for a while.  **[PNC_3402827_18]** 

6. **Acquisition Possibilities**  
   **Q:** Are acquisitions likely in this environment?  
   **A:** We don't see value in an acquisition at the moment. Potential targets don't make sense considering their balance sheets and required investments.  **[PNC_3402827_19]** 

7. **Consumer Lending Growth**  
   **Q:** What are growth drivers in consumer lending?  
   **A:** We're underpenetrated with existing clients in consumer lending. We see material upside by increasing penetration to match our peers, and we're investing to achieve this.  **[PNC_3402827_10]** 

8. **Capital Markets Outlook**  
   **Q:** How is the capital markets pipeline?  
   **A:** Although some fourth-quarter activity shifted into the third, pipelines are strong and momentum continues. We expect some lumpiness quarter-to-quarter but overall positive trends.  **[PNC_3402827_7]** 

9. **Deposit Stabilization**  
   **Q:** What's the outlook for noninterest-bearing deposits?  
   **A:** We've stabilized noninterest-bearing deposits over the past couple of quarters at current levels after prior declines. The effect of lower rates on compensating balances is uncertain.  **[PNC_3402827_13]** 

10. **Economic Conditions Impact**  
    **Q:** How are clients' demand trends and economic health?  
    **A:** There's a pause in loan demand due to the election and rate environment, but we're seeing constructive signs like increased loan commitments. Companies are healthy, though margin pressures exist due to inability to pass on prices.  **[PNC_3402827_7]** ,  **[PNC_3402827_21]** 

cc6ddec23eda7bb711837fc6360bce0551af54027ecae293ede87f0163aba8b0

- Lower loan utilization rates are impacting loan growth, as customers pay down revolving credit lines due to access to alternative funding sources in the public markets and hesitancy among manufacturers, leading to expectations of only modest loan growth.  **[PNC_3379859_13]** **[PNC_3379859_7]**
- Achieving positive operating leverage for the full year is **"pretty tough"** due to net interest income and rate issues, indicating challenges in revenue growth compared to expenses.  **[PNC_3379859_24]**
- The biggest risk to achieving record net interest income in 2025 is a massive yield curve inversion or significant rate decline, which could impact the repricing of fixed-rate assets at lower yields, potentially jeopardizing future earnings targets.  **[PNC_3379859_12]**

ca23cd601c38d3dc3bb741ce5f84ccbb8b73d5e10fed15368e218bcacaa0d4f2

1. **NII Outlook and Loan Growth**  
   **Q:** Why is NII guidance higher despite lower loan growth?  
   **A:** Management expects higher NII even without loan growth due to positive deposit dynamics and benefits from securities restructuring.  **[PNC_3393373_8]** **[PNC_3393373_6]**  They have muted loan growth assumptions but are confident in achieving their NII goals without further restructuring.  **[PNC_3393373_6]** **[PNC_3393373_8]** 

2. **Loan Growth Expectations**  
   **Q:** What's causing subdued loan growth, and when will it improve?  
   **A:** Despite winning clients at a strong pace, loan growth remains muted as customers are not drawing on lines.  **[PNC_3393373_24]** **[PNC_3393373_25]**  Factors include higher costs of holding inventory due to elevated interest rates and economic uncertainty.  **[PNC_3393373_26]**  Management has removed loan growth from guidance until they see concrete evidence of improvement.  **[PNC_3393373_23]** **[PNC_3393373_24]** 

3. **Capital Deployment and Buybacks**  
   **Q:** Will buybacks accelerate given strong capital levels?  
   **A:** They plan to continue buybacks at the current pace of $100 million per quarter.  **[PNC_3393373_9]**  If loan growth doesn't materialize and excess capital continues to build, they might consider accelerating buybacks in the future.  **[PNC_3393373_9]** 

4. **Deposit Pricing and Trends**  
   **Q:** How will deposit rates and levels trend from here?  
   **A:** Deposit rates paid are expected to drift up only slightly, by a handful of basis points.  **[PNC_3393373_10]**  Deposits are anticipated to be stable to down, with an emphasis on stability.  **[PNC_3393373_7]** 

5. **Asset Quality and CRE Exposure**  
   **Q:** Are there concerns about credit quality, especially in CRE?  
   **A:** Asset quality remains stable with adequate reserves.  **[PNC_3393373_16]** **[PNC_3393373_18]**  The increase in nonperforming loans is expected and primarily due to office commercial real estate.  **[PNC_3393373_18]** **[PNC_3393373_31]**  They've thoroughly reviewed their CRE portfolio and are not surprised by any developments.  **[PNC_3393373_31]** 

6. **NIM Expectations**  
   **Q:** Can NIM reach 3% next year even with rate cuts?  
   **A:** While not providing specific NIM guidance, management believes returning to a 3% NIM is reasonable in a normal environment.  **[PNC_3393373_15]**  They expect NIM to increase into 2025.  **[PNC_3393373_15]** 

7. **Expense Guidance and Cost Savings**  
   **Q:** Why is expense growth expected despite cost savings?  
   **A:** Expenses don't occur uniformly throughout the year, and the second half includes investments coming online, such as technology expenses.  **[PNC_3393373_21]**  Even with increased cost savings goals, they anticipate expenses growing due to these planned investments.  **[PNC_3393373_21]** **[PNC_3393373_23]** 

8. **Forward Starting Swaps and NII Recovery**  
   **Q:** How do forward starting swaps impact NII in 2025?  
   **A:** The $18 billion in forward starting swaps lock in higher rates, increasing the certainty of NII recovery in 2025.  **[PNC_3393373_11]**  This move secures some of the anticipated benefit and provides more certainty around future earnings.  **[PNC_3393373_11]** 

9. **Credit Card Strategy**  
   **Q:** What's the plan for new credit card offerings?  
   **A:** They aim to offer better credit card products to existing clients, improving technology and service levels.  **[PNC_3393373_14]** **[PNC_3393373_28]**  The goal is to achieve fair share penetration in consumer lending without changing credit standards.  **[PNC_3393373_28]** 

10. **Fee Income Expectations**  
    **Q:** What's driving the softer fee income outlook?  
    **A:** Lowered fee income expectations are due to continued softness in mortgage revenues and reduced loan-related fees from decreased loan syndication activity.  **[PNC_3393373_13]**  Other fee categories remain on schedule.  **[PNC_3393373_13]** 

11. **Impact of FedNow**  
    **Q:** Will FedNow affect PNC's payments business?  
    **A:** Management does not expect FedNow to impact PNC materially.  **[PNC_3393373_19]**  They already offer real-time payments through existing networks, and FedNow doesn't add or subtract from their opportunities.  **[PNC_3393373_19]** 

12. **Visa Stake Plans**  
    **Q:** What's the plan for the remaining Visa stake?  
    **A:** The remaining Visa shares are subject to Visa's schedule and litigation outcomes.  **[PNC_3393373_29]**  They will monitor the situation but don't control the timing of monetization.  **[PNC_3393373_29]** 

9c92bdea61f824aa8682619c14bb8a21f6753083a2392125c6ae68b67623363e

1. **Net Interest Income Outlook**  
   **Q:** How will rate cuts affect your NII outlook?  
   **A:** Our NII is **relatively neutral** to rate cuts because we've positioned our balance sheet to be **interest rate neutral**.  **[PNC_3370280_6]**  We expect NII to decline in the first half of the year, trough around the time of the cuts, and then grow back to current levels.  **[PNC_3370280_9]**  We anticipate **record NII in 2025** due to the repricing of our fixed-rate assets.  **[PNC_3370280_9]**  The main variable will be deposit pricing behavior as rates change.  **[PNC_3370280_6]** 

2. **Loan Growth Outlook**  
   **Q:** What drives your loan growth outlook for 2024?  
   **A:** We project **average loan growth of 1%** and **spot growth of 3–4%**, primarily in the commercial segment and mainly in the back half of the year.  **[PNC_3370280_5]** **[PNC_3370280_11]**  Consumer loan growth is expected to be modest throughout the year.  **[PNC_3370280_5]** **[PNC_3370280_11]**  The uptick in commercial loans is anticipated due to increased utilization and economic activity post a mild recession.  **[PNC_3370280_11]** 

3. **Capital Markets Revenue Growth**  
   **Q:** What is your outlook for capital markets revenue in 2024?  
   **A:** We expect capital markets revenue to increase by **about 20% year-over-year**.  **[PNC_3370280_7]**  This growth is driven by a rebound in our Harris Williams M&A advisory business, supported by strong pipelines.  **[PNC_3370280_7]**  We anticipate quarterly revenues to align with Q1 and Q4 of 2023 levels.  **[PNC_3370280_7]** 

4. **Operating Leverage Guidance**  
   **Q:** Can you sustain your negative operating leverage guidance?  
   **A:** We aim for approximately **100 basis points** of negative operating leverage in 2024, which compares favorably to peers.  **[PNC_3370280_8]**  We've worked hard to achieve **stable expenses year-over-year**.  **[PNC_3370280_8]**  Our NII is fairly predictable, and we are confident in our guidance unless significant changes occur in deposit pricing or yield curve dynamics.  **[PNC_3370280_8]** 

5. **Credit Quality and Reserves**  
   **Q:** Are you fully reserved for future charge-offs?  
   **A:** Yes, we believe we're fully reserved for expected charge-offs under a mild recession scenario.  **[PNC_3370280_16]**  Our reserves stand at **1.7%**, which is appropriate.  **[PNC_3370280_15]**  Charge-offs will occur but won't impact P&L since we've already provisioned for them.  **[PNC_3370280_16]**  If the economy worsens beyond our expectations, we may need to increase reserves.  **[PNC_3370280_17]** 

6. **Deposit Pricing and Betas**  
   **Q:** How do you expect deposit costs to change with rate cuts?  
   **A:** We anticipate deposit costs to **ease quickly** on the commercial and high-end consumer side when rates are cut.  **[PNC_3370280_10]**  However, core consumer deposit rates might continue to drift up even with rate reductions.  **[PNC_3370280_10]** **[PNC_3370280_29]**  We expect deposit betas to move down **materially right out of the gate** with the first rate cut.  **[PNC_3370280_34]** 

7. **M&A Strategy and Scale**  
   **Q:** How important is scale, and what's your M&A outlook?  
   **A:** **Scale matters** more than ever in today's banking industry.  **[PNC_3370280_24]**  We're gaining market share organically but believe we're a natural player in industry consolidation.  **[PNC_3370280_25]**  We're open to M&A opportunities that strengthen our position but won't pursue them at any cost.  **[PNC_3370280_26]**  The regulatory environment affects M&A activity, and certain deals may get approved.  **[PNC_3370280_27]** 

8. **Visa Share Monetization**  
   **Q:** What are your plans for your Visa shares?  
   **A:** We hold **3.5 million Visa shares** with an unrealized gain of **$1.4 billion**.  **[PNC_3370280_14]**  Pending a shareholder vote, we might be allowed to monetize up to **50%** of our holdings.  **[PNC_3370280_14]**  Once approved, we'll proceed with our monetization plans accordingly.  **[PNC_3370280_14]** 

9. **Swap Portfolio Management**  
   **Q:** How are you managing your swap portfolio?  
   **A:** We terminated **$3.6 billion** in swaps and added new ones as part of regular activities.  **[PNC_3370280_22]**  We're keeping our balance sheet neutral to interest rate movements.  **[PNC_3370280_19]**  We don't see an urgency to deploy funds in the current rate environment and expect opportunities to persist.  **[PNC_3370280_36]** 

10. **Private Credit Competition**  
    **Q:** How does private credit competition affect you?  
    **A:** We don't compete directly with private credit lenders focusing on unsecured leveraged lending.  **[PNC_3370280_13]** **[PNC_3370280_35]**  Our lending is centered on traditional, secured loans to core clients.  **[PNC_3370280_32]**  While private credit exists, it hasn't significantly impacted our growth. We serve private equity clients in various capacities, and they remain valuable clients.  **[PNC_3370280_13]** 

931065c79ceda56e7f4d9603218701b9b5c617212154f1b3edcfc6a16b925fb3

- **Investors are concerned about PNC's potential acquisition strategy**, fearing the company might engage in unwise deals that could negatively impact shareholder value.  **[PNC_3370280_26]** **[PNC_3370280_25]**
- **Increased competition from private credit markets** may affect PNC's loan growth and returns, as private credit offers higher yields that PNC might not compete with.  **[PNC_3370280_37]**
- **Uncertainty regarding net interest income due to assumptions on deposit betas and interest rates** could negatively impact operating leverage if these assumptions are incorrect.  **[PNC_3370280_8]**

a9034abbe9eb60fa0f5f094a274a9458585d922e5e58f4f1d025572c7f2bf82a

PNC Financial Services Group Inc (PNC)

Financials