PNC Financial Services Group, Inc. (the) · NYSE:PNC
PNC Financial Services Group, Inc. (the) — Q1 2007 Earnings Presentation
15 slides from PNC Financial Services Group, Inc. (the)'s earnings presentation, Apr 18, 2007
Slide 1: First Quarter 2007 Earnings Conference Call
Exhibit 99.2 The PNC Financial Services Group, Inc. First Quarter 2007 Earnings Conference Call April 18, 2007
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information This presentation contains forward-looking statements regarding our outlook or expectations relating to PNC’s future business, operations, financial condition, financial performance and asset quality. Forward-looking statements are necessari
Slide 3: 2007 First Quarter Highlights
2007 First Quarter Highlights Reported earnings of $1.46 per diluted share Adjusted earnings of $1.38 per diluted share, a 15% increase over 1Q06 adjusted earnings * Banking businesses driving the improvement Mercantile integration on track Enhanced client initiatives producing positive early result
Slide 4: Earnings Per Share Summary
Earnings Per Share Summary Diluted Earnings Per Share 1Q07 vs 1Q06 1Q07 vs 4Q06 1Q07 1Q06 % Change 4Q06 % Change Net income, as reported $1.46 $1.19 23% $1.27 15% Adjustments: Gain related to transfer of BlackRock (0.17) shares for LTIP Loss from the net mark-to-market 0.06 0.02 adjustment on LTIP s
Slide 5: Growing Higher Quality Revenue Streams
Growing Higher Quality Revenue Streams 1Q06 Revenue Mix As Adjusted * 1Q07 Revenue Mix As Adjusted * Growth 1Q07 vs 1Q06 As Adjusted ** PNC, Excluding Mercantile PNC Noninterest Noninterest Income Income 14% 17% 60% 59% Deposit NII Deposit NII 13% 20% 24% 25% Loan NII 17% Loan NII 15% (9)% 1% Total
Slide 6: Creating Positive Operating Leverage
Creating Positive Operating Leverage Growing Revenues Faster Than Expenses $ billions Continuing the Trend - 1Q07 vs 1Q06* Compound Annual PNC As Adjusted, $7.0 Growth Rate (2004 – 2006) Excluding Mercantile PNC As Adjusted $6.0 Revenue Revenue +10% +15% 9% $5.0 $4.0 Expense Expense +6% +11% $3.0 7%
Slide 7: Maintaining Moderate Risk Profile
Maintaining Moderate Risk Profile Credit Risk Profile - Credit decisions driven by risk-adjusted returns - Strong credit quality - Minimal sub-prime exposure Interest Rate Risk - Total return philosophy - Sophisticated risk management skills - Well-positioned balance sheet 7
Slide 8: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information We make statements in this presentation, and we may from time to time make other statements, regarding our outlook or expectations for earnings, revenues, expenses and/or other matters regarding or affecting PNC that are forward-looking stat
Slide 9: Cautionary Statement Regarding Forward-Looking Information (continued)
Cautionary Statement Regarding Forward-Looking Information (continued) • Legal and regulatory developments could have an impact on our ability to operate our businesses or our financial condition or results of operations or our competitive position or reputation. Reputational impacts, in turn, could
Slide 10: Non-GAAP to GAAP Reconcilement: Income Statement Summary – First Quarter 2007
Non-GAAP to GAAP Reconcilement Appendix Income Statement Summary – First Quarter 2007 PNC As Reported Taxable Taxable As Adjusted, TE GAAP Equivalent Equivalent Adjusted, Basis, Excluding ($ millions) Basis Adjustment Basis Adjustments TE Basis Mercantile Mercantile Net interest income $623 $6 $629
Slide 11: Non-GAAP to GAAP Reconcilement: Income Statement Summary – First Quarter 2006
Non-GAAP to GAAP Reconcilement Appendix Income Statement Summary – First Quarter 2006 PNC As Reported Taxable Taxable PNC As Adjusted, TE GAAP Equivalent Equivalent Adjusted, Basis, Excluding ($ millions) Basis Adjustment Basis Adjustments TE Basis Mercantile Mercantile Net interest income $556 $7 $
Slide 12: Non-GAAP to GAAP Reconcilement: First Quarter 2006 vs First Quarter 2007
Non-GAAP to GAAP Reconcilement Appendix Income Statement Summary – First Quarter ’06 vs First Quarter ‘07 1Q07 As Adjusted, TE 1Q06 As 1Q07 As Basis Growth Adjusted, TE Adjusted, TE Growth Q106 Excluding Growth Q106 1Q06 Q106 vs ($ millions) Basis Basis vs Q107 Mercantile vs Q107 Unadjusted 1Q07 Una
Slide 13: Non-GAAP to GAAP Reconcilement: Income Statement Summary – 2004 to 2006
Non-GAAP to GAAP Reconcilement Appendix Income Statement Summary – 2004 to 2006 BlackRock For the year ended December 31, 2006 PNC Deconsolidation and BlackRock PNC In millions As Reported Adjustments (a) Other Adjustments Equity Method As Adjusted Net interest income $2,245 $(10) $2,235 Provision f
Slide 14: Non-GAAP to GAAP Reconcilement: Income Statement Summary – 2004 to 2006 (continued)
Non-GAAP to GAAP Reconcilement Appendix Income Statement Summary – 2004 to 2006 (continued) For the year ended December 31, 2004 PFPC Distribution/ BlackRock PNC Out-Of-Pocket Deconsolidation and BlackRock PNC In millions As Reported Revenue and Expense Other Adjustments Equity Method As Adjusted Ne
Slide 15: Noninterest Income, Noninterest Expense and NIM Summary
Non-GAAP to GAAP Reconcilement Appendix Noninterest Income, Noninterest Expense and NIM Summary ($ millions) 1Q07 1Q06 4Q06 % of Total Adjustments As As Adjustments As As Adjustments As Q106 vs Q406 vs Adj. Noninterest income and Noninterest expense As Reported (a) Adjusted Reported (b) Adjusted Rep
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