Third Quarter 2023

Earnings Conference Call October 13, 2023

The PNC Financial Services Group

Cautionary Statement Regarding Forward-Looking and non-GAAP Financial Information

Our earnings conference call presentation is not intended as a full business or financial review and should be viewed in the context of all of the information made available by PNC in its SEC filings and on our corporate website.

The presentation contains forward-looking statements regarding our outlook for financial performance, such as earnings, revenues, expenses, tax rates, capital and liquidity levels and ratios, asset levels, asset quality, financial position, and other matters regarding or affecting PNC and its future business and operations, including sustainability strategy. Forward-looking statements are necessarily subject to numerous assumptions, risks and uncertainties, which change over time. The forward- looking statements in this presentation are qualified by the factors affecting forward-looking statements identified in the more detailed Cautionary Statement included in the Appendix. We provide greater detail regarding these and other factors in our 2022 Form 10-K, our subsequent From 10-Qs, and our other subsequent SEC filings. Our forward-looking statements may also be subject to risks and uncertainties including those we may discuss in this presentation or in our SEC filings. Future events or circumstances may change our outlook and may also affect the nature of the assumptions, risks and uncertainties to which our forward-looking statements are subject. Forward-looking statements in this presentation speak only as of the date of this presentation. We do not assume any duty and do not undertake any obligation to update those statements. Actual results or future events could differ, possibly materially, from those anticipated in forward-looking statements, as well as from historical performance. As a result, we caution against placing undue reliance on any forward-looking statements.

We include non-GAAP financial information in this presentation. Non-GAAP financial information includes adjusted financial metrics such as tangible book value per common share, pretax, pre-provision earnings, net interest margin, estimated expanded-risk based CET1 Ratio, and tangible common equity ratio. Reconciliations for such financial information may be found in our presentation, in these slides, including the Appendix, in other materials on our corporate website, and in our SEC filings. This information supplements our results as reported in accordance with GAAP and should not be viewed in isolation from, or as a substitute for, our GAAP results. We believe that this information and the related reconciliations may be useful to investors, analysts, regulators and others to help understand and evaluate our financial results, and with respect to adjusted metrics, because we believe they better reflect the ongoing financial results and trends of our businesses and increase comparability of period-to-period results. We may also use annualized, pro forma, estimated or third party numbers for illustrative or comparative purposes only. These may not reflect actual results.

References to our corporate website are to www.pnc.com under "About Us - Investor Relations." Our SEC filings are available both on our corporate website and on the SEC's website at www.sec.gov. We include web addresses here as inactive textual references only. Information on these websites is not part of this presentation.

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Delivered Solid Third Quarter 2023 Results

  • Solid third quarter
    • Continued to execute on our strategic priorities
    • Generated positive operating leverage
    • Increased capital position
    • Continued strong expense control
    • Maintained strong credit quality
  • Fourth quarter events
    • On October 2, completed the acquisition of ~$16 billion of capital commitments facilities of Signature Bridge Bank, N.A.
    • Implemented an expense management plan that includes more than $725 million of planned expense actions benefiting 2024

Net Income

$1.6 billion

Diluted Earnings Per Share

$3.60

Positive Operating Leverage

3%

Net Loan Charge-off Ratio

0.15%

Basel III CET1 Capital Ratio

9.8%

Tangible Common Equity Ratio (non-GAAP)

5.7%

− Net Loan Charge-Off Ratio represents annualized net charge-offs (NCOs) to average loans for the three months ended.

− Basel III common equity Tier (CET) 1 capital ratio - 9/30/23 ratio is estimated. Details of the calculation are in the capital ratios table in the financial highlights section of the earnings release.

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− Tangible common equity ratio (non-GAAP) - See Reconciliation in Appendix.

Balance Sheet: Well-Positioned Balance Sheet

3Q23 vs. 2Q23

3Q23 vs. 3Q22

Average balances, $ billions

3Q23

$ Change

% Change

$ Change

% Change

Total loans

$319.5

($5.0)

(2)%

$6.5

2%

Investment securities

$139.7

($1.3)

(1)%

$2.7

2%

Federal Reserve Bank (FRB) balances

$37.9

$7.3

24%

$6.4

20%

Deposits

$422.5

($3.2)

(1)%

($16.7)

(4)%

Borrowed funds

$67.5

$1.8

3%

$23.2

52%

Common shareholders' equity

$42.1

$0.4

1%

$0.8

2%

3Q23

3Q23

Period End

3Q23

2Q23

vs. 2Q23

3Q22

vs. 3Q22

Basel III CET1 capital ratio

9.8%

9.5%

30 bps

9.3%

50 bps

AOCI ($ in billions)

($10.3)

($9.5)

(8)%

($10.5)

2%

Tangible book value per common share (non-GAAP)

$78.16

$77.80

--

$69.98

12%

Return on average common equity

13.65%

13.01%

64 bps

14.97%

(132) bps

− AOCI represents accumulated other comprehensive income.

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− Tangible book value per common share (non-GAAP) - See reconciliation in Appendix.

Balance Sheet: Large and Diversified Lending Franchise

Average Loan Balances

+2.1% Year Over Year; -1.5% Linked Quarter

$313.0

$321.9

$325.5

$324.5

$319.5

$224.6

$214.1

$221.6

$223.2

$217.7

5.29%

5.57%

5.75%

$ billions

4.75%

3.98%

Average balances,

$98.9

$100.3

$100.9

$101.3

$101.8

3Q22

4Q22

1Q23

2Q23

3Q23

Consumer

Commercial

Total Loan Yield

Commercial Loans:

  • +1.7% YoY
  • -2.5%LQ

Consumer Loans:

  • +3.0% YoY
  • +0.5% LQ

− YoY represents change in average balances year over year, and LQ represents change in average balances linked quarter.

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The PNC Financial Services Group Inc. published this content on 13 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 October 2023 11:20:28 UTC.