PNC Financial Services Group, Inc. (the) · NYSE:PNC
PNC Financial Services Group, Inc. (the) — The PNC Financial Services Group — BancAnalysts Association of Boston Conference 2024
29 slides from PNC Financial Services Group, Inc. (the)'s conference presentation, Nov 8, 2024
Slide 1: Driving Growth Through National Expansion
Driving Growth Through National Expansion BancAnalysts Association of Boston Conference November 8, 2024
Slide 2: Cautionary Statement
Cautionary Statement Regarding Forward-Looking and non-GAAP Financial Information This 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 presenta
Slide 3: Driving for Scale
Driving for Scale Retail Banking Corporate & Institutional Asset Management $96bn $249bn $204bn $146bn $16bn $27bn Deposits Loans Loans Deposits Loans Deposits #5 Retail Franchise1 #4 C&I Lender2 2,242 $84bn 38% ~20k +$5bn $430bn Coast-to-Coast Client Fee Primary YTD Managed Client Branches Assets R
Slide 4: Focus on Organic Investment and Growth
Focus on Organic Investment and Growth Grow DDAs Grow Payments Grow Client Assets • Branch Investments • Treasury Management • PNC Investments • Digital Platforms • Credit Card • Mass Affluent • Relationship Rewards • Private Bank Grow Expansion Markets Retail Banking Corporate & Institutional Asset
Slide 5: Top-Rated Businesses Under-Exposed to Large and Fast-Growing Markets
Top-Rated Businesses Under-Exposed to Large and Fast-Growing Markets PNC in 2011: Regional Footprint Leading Corporate Bank and Treasury Mgmt. Franchise and Slower Growing Markets #1 in Corporate Client Satisfaction1 2024 Global Finance Awards2 Best Corporate / Institutional Digital Banks; Unite
Slide 6: Expanding Into Larger and Faster Growing Markets
Expanding Into Larger and Faster Growing Markets Bank / Branch Acquisitions Organic Market Build-Outs Dallas Kansas City Minneapolis Nashville Denver Houston Boston Phoenix Seattle Portland San Diego Las Vegas (Branch Acquisition) Successful Expansion Through Build Or Buy 6
Slide 7: Our Ongoing Franchise Transformation
Our Ongoing Franchise Transformation PNC in 2011 PNC Today Full C&IB Presence1 Retail Branch Presence PNC Weighted Avg. Population Growth2 1.2% 2.4% # of Top-30 MSAs3 9 / 30 30 / 30 C&IB / # of Prospects ~90k ~227k AMG # of 10 Fastest Growing MSAs4 0 / 10 10 / 10 # of Top-30 MSAs3 10 / 30 26 / 30 Re
Slide 8: PNC Expansion Markets – Current Profile
PNC Expansion Markets – Current Profile Expansion Markets Building Our Brand in Expansion Markets Overview $64 billion Average Loans (non-GAAP)1 Denver $109 billion Average deposits (non-GAAP)1 Nashville $24 billion AUM (non-GAAP)2 San Francisco ~930 Branches San Diego Miami ~1,950 Austin ATMs Dalla
Slide 9: Consistent Expansion Markets Playbook
Consistent Expansion Markets Playbook • Leverage Regional President model to become deeply entrenched in communities • Hire top local talent and combine with relocated PNC bankers • Retain client-facing top talent • Rigorous client selection and grow with the great ones • Drive value-added strategy
Slide 10: Expansion Market Sales Growing Rapidly – C&IB and AMG
Expansion Market Sales Growing Rapidly – C&IB and AMG Expansion Market C&IB and AMG Sales1 2024 C&IB & AMG Sales1 Expansion Market New C&IB and AMG Sales1 Generated ($) Percent of Total C&IB and AMG Sales1 Pennsylvania 159 years in market Texas 8 years in market 48% 48% 45% 46% Ohio California ~4 ye
Slide 11: Expansion Market Sales Growing Rapidly – Retail
Expansion Market Sales Growing Rapidly – Retail Expansion Market Consumer DDA Production 2024 Consumer DDA Production Expansion Market New Gross Consumer DDA Production Percent of Total Consumer DDA Production Texas 8 years in market Pennsylvania 159 years in market 56% 39% Ohio 37% 34% Florida New
Slide 12: Executing on the Playbook
Executing on the Playbook Hire and Keep Great People Win Great Clients No Change to Risk Appetite ~90% talent retention since 2011 Cumulative new C&IB clients in Expansion Markets Past ~3,000 new clients since 2018 Legacy Present Markets 175 Future Senior client- facing C&IB hires in Expansion Past
Slide 13: Executing on the Playbook
Executing on the Playbook Build Deep Relationships Drive Value-Added Strategy Staying Core Funded Non-credit % of C&IB sales in Expansion Markets1 TM penetration in Expansion Markets2 PNC consolidated loan to deposit ratio 65% TM Clients 62% 84% 83% Non-TM Clients 54% 56% 75% 76% 76% 49% BBVA Portfo
Slide 14: Executing on the Playbook – Client Example
Executing on the Playbook – Client Example $15 bn+ Services Company in a PNC Expansion Market “Be there when great clients need it” “Value-Added Strategy” Led significant “Patient, persistent, securitization during Doubled size of “Focus on best- consistent” COVID, JLA on revolver; securitization, w
Slide 15: Bolstering Branch Presence in Expansion Markets
Bolstering Branch Presence in Expansion Markets Austin Denver Dallas ~10 Branches ~15 Branches ~20 Branches San Antonio ~5 Branches Houston Miami ~15 Branches ~5 Branches 1Q24: Announced ~100 New Branch Builds by 2028 15 – For definition of PNC Expansion Markets refer to definition 1 on slide 28.
Slide 16: Bolstering Branch Presence in Expansion Markets
Bolstering Branch Presence in Expansion Markets Austin Denver Dallas Atlanta Charlotte Raleigh ~10 Branches ~15 Branches ~20 Branches ~25 Branches ~25 Branches ~10 Branches Phoenix Orlando ~10 Branches ~15 Branches San Antonio Tampa ~5 Branches ~20 Branches Houston Miami ~15 Branches ~40 Branches To
Slide 17: Densifying Retail Markets and Deepening Relationships
Densifying Retail Markets and Deepening Relationships Densifying Our Branch Presence Opportunity to Further Deepen Retail Relationships Branch share in key markets1 Today Est. Increase in Share 2 Credit Card Penetration3 Investments Penetration4 7% = Target Share Raleigh Charlotte Austin Phoenix Atl
Slide 18: Expansion Markets Are Growing Rapidly
Expansion Markets Are Growing Rapidly C&IB and AMG Expansion Market Revenue (non-GAAP)1 2023 20% CAGR (2012 – 2024) 2021 San Diego, Austin, Las Vegas ~$2bn YTD 9/30/24 Annualized Tucson, San Antonio, Los Angeles, Sacramento, San Francisco, Fort Worth, Orange County 2016 – 17 2018 – 19 Dallas Boston
Slide 19: Improving Productivity Across Markets
Improving Productivity Across Markets C&IB and AMG Expansion Market vs. Legacy Market Revenue per Capita1 2012 2016 2020 2024 De Novo Southwest Southeast Legacy 19 – For definition of PNC Expansion Markets and PNC Legacy Markets refer to definition 1 and 2 on slide 28. For additional footnoted infor
Slide 20: Significant Upside to Expansion Market Revenue
Significant Upside to Expansion Market Revenue C&IB and AMG Expansion Market Revenue (non-GAAP)1 >$6bn ~$2bn $3.5bn YTD 9/30/24 Annualized Near-Term Long-Term 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Target Opportunity 20 – For definition of PNC Expansion Markets and PNC Lega
Slide 21: National Expansion Key Takeaways
National Expansion Key Takeaways National Expansion Supports Sustained Long-Term Growth for PNC Significant Incremental Organic Revenue Opportunity Accelerating Retail Expansion With Incremental Upside Relatively Low Risk Organic Strategy with Attractive Returns 21
Slide 22: Appendix: Cautionary Statement
Appendix: Cautionary Statement Regarding Forward-Looking Information We make statements in this presentation, and we may from time to time make other statements, regarding our outlook for financial performance, such as earnings, revenues, expenses, tax rates, capital and liquidity levels and ratios,
Slide 23: Appendix: Cautionary Statement
Appendix: Cautionary Statement Regarding Forward-Looking Information • Our forward-looking financial statements are subject to the risk that economic and financial market conditions will be substantially different than those we are currently expecting. These statements are based on our views that: −
Slide 24: Appendix: Cautionary Statement
Appendix: Cautionary Statement Regarding Forward-Looking Information • Business and operating results are affected by our ability to identify and effectively manage risks inherent in our businesses, including, where appropriate, through effective use of systems and controls, third-party insurance, d
Slide 25: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Expansion Market Average Loans and Average Deposits (non-GAAP) For the three months ended Sep. 30, 2024 $ millions Average Loans Average Deposits PNC balances $319,602 $422,122 Less: Non-Expansion Market balances 255,569 313,654 Expansion Market Balances (no
Slide 26: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Expansion Market C&IB and AMG Revenue (non-GAAP) For the nine months ended $ millions Sep. 30, 2024 PNC revenue $15,988 Less: Retail Banking revenue 10,983 Less: Other revenue (3,767) C&IB and AMG revenue $8,772 Less: Non-Expansion Market C&IB and AMG revenu
Slide 27: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Expansion Market AMG Assets Under Management (non-GAAP) For the period ending $ billions Sep. 30, 2024 AMG assets under management $214 Less: Non-Expansion Market AMG assets under management 190 Expansion Market AMG Assets Under Management (non-GAAP) $24 Exp
Slide 28: Footnotes and Definitions
Footnotes and Definitions Definitions 1. PNC Expansion Markets: refer collectively to PNC’s Southeast, Southwest and De Novo markets, excluding the business operations of PNC’s national businesses. Southeast markets include PNC markets in the states of Florida, Georgia, North Carolina and South Caro
Slide 29: Footnotes and Definitions
Footnotes and Definitions Slide 8 - PNC Expansion Markets – Current Profile 1. Average loans and average deposits in PNC Expansion Markets represents a non-GAAP measure and is calculated as total average loan and average deposit balances in PNC Expansion Markets for 3Q24. See non-GAAP reconciliation
The PNC Financial Services Group — BancAnalysts Association of Boston Conference 2024 on 6ix