PNC Financial Services Group, Inc. (the) · NYSE:PNC
PNC Financial Services Group, Inc. (the) — RBC Capital Markets Financial Institutions Conference 2017
15 slides from PNC Financial Services Group, Inc. (the)'s conference presentation, Mar 7, 2017
Slide 1: RBC Capital Markets Financial Institutions Conference
Exhibit 99.1 RBC Capital Markets Financial Institutions Conference March 7, 2017
Slide 2: Cautionary Statement Regarding Forward-Looking and Non-GAAP Financial Information
Cautionary Statement Regarding Forward-Looking and ®PNC Non-GAAP Financial Information This presentation is not intended as a full business or financial review ih meus be viewed in the context of all of the information ilable by PNC in its SEC fil outlook for earnings, revenues, expenses, capital th
Slide 3: Agenda
Agenda ®PNC = Balance sheet trends = Approach to interest rate risk and balance sheet management = High-quality, well-diversified securities portfolio = Well positioned to deploy duration as rates rise
Slide 4: Balance Sheet Trends
Balance Sheet Trends ®PNC $ billions 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 Commercial lending $109.0 $117.1 $128.4 $133.5 $137.9 Consumer lending 769 785 76.4 73.2 729 Total loans $185.9 $195.6 $204.8 $206.7 $210.8 Investment securities $61.4 $60.3 $55.8 $70.5 $75.9 Interest-earning deposits
Slide 5: What is interest rate risk?
What is interest rate risk? @PNc Sensitivity of income and equity to changes in the interest rate environment Arises when the interest rate risk profile (index, maturity, and cash flows) of assets does not match that of liabilities Common metric for measuring interest rate risk is Duration of Equity
Slide 6: Interest rate risk sensitivity has been largely stable in recent years
Interest rate risk sensitivity has been largely stableinrecent (PNC years Duration of Equity NII Sensitivity 4 70 50% os ° a0 2 10 S10 ‘ 20 8 - 50 10 o% 1 e $ Sah hg gh gh gh Sg gh gh gh gh ig? MEEDOE = —10yr Swap Rate B= +100 bp (gradual) 10-K for adeltional details. Given the inherent limitations
Slide 7: PNC balance sheet reflects a value-driven philosophy
PNC balance sheet reflects a value-driven philosophy @PNC Loan growth outpaced our peers significantly from 2012 to 2014 Beginning in 2015, PNC loan growth slowed reflecting market conditions and our risk appetite Securities portfolio has been steadily growing reflecting robust growth in deposits Se
Slide 8: Investment securities portfolio is well-diversified and high-quality with short duration
Investment securities portfolio is well-diversified and @®PNC high-quality with short duration * Portfolio composition has changed significantly over the past few years * Regulatory constraints may impact portfolio composition in the future Diversified Securities Portfolio Government and Agency Hold
Slide 9: Securities portfolio has performed well but low yields mute the outlook for future returns
$ billions Securities portfolio has performed well but low yields mute the @©PNC outlook for future returns Private Label as a % of PNC’s Securities Portfolio 12BVO? WIND wwHVI IIE 1w8VIS rave wes r2BwI6 Net Fixed Rate Securities 12/31/08 pi TeV f3N2 12S ABV VIS 4/96 ~ Book Yield of Investment Secur
Slide 10: PNC's balance sheet retains considerable flexibility to deploy duration as and when rates rise
PNC’s balance sheet retains considerable flexibility to deploy duration as and when rates rise = Balance sheet remains quite asset sensitive = Duration of Equity, NII sensitivity, and proportion of fixed rate assets all point to asset sensitivity = Large cash balances provide flexibility to deploy d
Slide 11: Summary
Summary @PnNc Balance sheet remains asset sensitive Deposit growth remains solid although rate increases could present a headwind Ample capital and liquidity to support loan growth where the client opportunity and risk-reward make sense Securities portfolio is well positioned both from a regulatory
Slide 12: Appendix: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking ®PNC Information \ot intended as a full business or financial review. It ould not be viewed in olaion but rather in the context ol al ofthe faformation made avaiable by PNG‘ ts SEC lings regarding even expenses, capital and ‘gui levels and rat
Slide 13: Appendix: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking ®PNC Information Our forward-looking than (pe jaeat market will gt 1 prices, expan result of the 2016 elections. Short-term interest ad along ‘wa inflation. These forward- ’ indicated, ‘the impact of potential Tegal and regulatory contingencie
Slide 14: Appendix: Cautionary Statement Regarding Forward-Looking Information
Appendix: Cautionary Statement Regarding Forward-Looking ®PNC Information businesses, including, wi sppropeae through effective use of i Goma nd contre hid party insurance, derwalfves, and capital management techniques, and ribet evolving regulatory capital and liquidity standards. * Business and op
Slide 15: Appendix: Peer Group of Banks
Appendix: Peer Group of Banks @PNC The PNC Financial Services Group, Inc. PNC BB&T Corporation BBT Bank of America Corporation BAC Capital One Financial Corporation COF Fifth Third Bancorp FITB JPMorgan Chase & Co JPM KeyCorp KEY M&qT Bank Corporation MTB Regions Financial Corporation RF SunTrust Ba
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