William Demchak

About William Demchak

William S. Demchak, age 62 as of April 23, 2025, is Chairman and Chief Executive Officer of The PNC Financial Services Group. He has served as CEO since April 2013 and Chairman since April 2014; he joined PNC in 2002 as CFO and became a director in 2013. He holds a BS from Allegheny College and an MBA from the University of Michigan . Under his leadership, PNC reported 2024 net income of $6.0B ($13.74 diluted EPS), “record revenue,” CET1 ratio of 10.5%, and returned $3.1B to shareholders; a $100 investment in PNC from 12/31/2019 was worth $145.5 at 12/31/2024, while “compensation actually paid” to the CEO was primarily driven by equity performance linkage .

Past Roles

External Roles

Fixed Compensation

Notes:

• CEO receives no additional director retainers or equity for board service .

Performance Compensation

• Program architecture
  • Total compensation target (2024): $20,000,000 with 70% long-term equity and 30% cash; CEO minimum equity ≥50% of total comp, actual 74% of incentive in equity for 2024 .
  • Annual cash incentive based on multiple categories (financial results, strategic execution, risk, customer, talent, accountability, leadership) with discretion; 2024 award: $6,200,000 .
  • Long-term incentive granted as 60% PSUs and 40% RSUs; PSUs payout 0–150% on three-year Adjusted ROE vs internal targets and three-year Adjusted EPS growth rank vs peer group, subject to risk review; RSUs vest ratably over three years .

Pay-versus-performance reference:

• CEO “Compensation Actually Paid” (CAP) for 2024: $33,453,083; Adjusted ROE (CSM): 10.94%; PNC TSR value of $100 (since 12/31/2019) = $145.5; Net Income $5,953M .

Multi-Year CEO Compensation (Summary Compensation Table)

Equity Vesting and Overhang (Supply/Demand Signals)

• 2024 grants (CEO): 53,538 PSUs and 35,692 RSUs; RSU tranches vest 2/20/2025, 2/20/2026, 2/20/2027; PSUs measured 2024–2026 with vest in early 2027, subject to risk/CET1 conditions .
• Awards vested in 2024: 77,985 shares vested (PSUs/RSUs) with $11,586,965 value realized; signals some supply entered float during 2024 .
• Outstanding unvested equity at 12/31/2024 (market value at $192.85):
  • Select tranches (counts and value): 60,747 ($11,715,059); 9,496 ($1,831,304); 48,326 ($9,319,669); 21,479 ($4,142,225); 53,538 ($10,324,803); 35,692 ($6,883,202) .

Equity Ownership & Alignment

Employment Terms

• No individual employment agreement; executives serve at will of Board .
• Change-of-Control (CoC) Agreements: double-trigger cash severance; 2x base salary plus 2x “applicable bonus percentage × base salary”; no excise tax gross-ups; potential cutback to avoid 4999 excise if beneficial; non-solicit of officers for one year post-termination .
• Estimated CEO CoC economics (as of 12/31/2024, assuming termination upon CoC at $192.85 share price):
  • Cash severance: $10,721,934; unvested equity: $42,808,811; total: $53,925,799 (includes enhanced benefits/plan values) .
• Retirement/Death/Disability treatment: retirement-eligible equity generally continues to original schedules; PRSUs may continue at HR Committee discretion; death triggers RSU immediate vest (100%) and PSUs at target with risk condition; CET1 gating applies; all equity subject to forfeiture/clawback/competitive activity limits .
• Clawback Policy: broad misconduct/risk-based recoupment across current/former employees with public disclosure of aggregate recoveries when applicable; adjustments can be pursued post-employment .
• Pension/SERP: Present value of accumulated defined benefit arrangements: $9,589,349 (Qualified, ERISA Excess, SERP) .

Board Governance (Director Service, Roles, Dual-Role Implications)

Implications:

• Combined Chair/CEO can raise independence optics risk, mitigated by a strong Presiding Director regime, majority independent board, and independent committee structure. CEO on Risk Committee enhances risk information flow but is a governance trade-off investors monitor .

Compensation Structure Analysis (Alignment and Risk Controls)

• Year-over-year mix shifted further to performance: 2024 incentive award for CEO was $23.7M (vs $18.7M target), with 74% of incentive equity-based; target total comp raised from $17.0M (2023) to $20.0M (2024) reflecting performance and market data .
• LTI design increased emphasis on PSUs (60% of LTI) with 0–150% outcome and risk-based review; CET1-based gates and no single-trigger vesting reduce windfall risk .
• Risk mitigants: no CoC gross-ups; 2.99× severance policy requires shareholder approval; clawback extends post-employment; hedging/pledging banned .
• Consultant independence: HR Committee retains Meridian; no conflicts found; management retains separate consultants for market data; HR Committee alone decides exec comp .

Equity Grant Details and Schedules (Granular)

Say-on-Pay & Shareholder Engagement

• 2025 AGM includes advisory vote to approve NEO compensation; Board recommends FOR; annual frequency maintained; ~280 investor meetings in 2024, ~75% of top-100 actives engaged; Presiding Director participates as appropriate .

Investment Implications

• Alignment: High skin-in-the-game (525k owned shares; CEO ownership guideline 125k with ongoing 33% retention) and heavy PSU weighting tie pay to multi-year ROE and relative EPS growth; hedging/pledging bans strengthen alignment .
• Supply/overhang: 2024 vesting of ~78k shares added float; upcoming RSU tranches in 2026–2027 and a sizable 2024 PSU block could introduce periodic selling pressure around vest events, subject to trading windows and CET1/risk conditions .
• Retention and transition risk: Double-trigger CoC at ~$54M with ~80% in equity value suggests strong retention; no employment agreement but retirement-eligible treatment and continuing-vesting design support orderly transitions; clawback and CET1 gates temper windfalls .
• Governance watchpoints: Combined Chair/CEO with CEO on Risk Committee merits ongoing monitoring; mitigants include empowered Presiding Director, majority independent board and fully independent HR/Audit committees .