PNC FINANCIAL SERVICES GROUP, INC. - FORM 8-K - EX-99.1 - April 16, 2021

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Exhibit 99.1

pncbanklogoa181.jpg



THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT
FIRST QUARTER 2021
(Unaudited)



THE PNC FINANCIAL SERVICES GROUP, INC.
FINANCIAL SUPPLEMENT
FIRST QUARTER 2021
(UNAUDITED)

The information contained in this Financial Supplement is preliminary, unaudited and based on data available on April 16, 2021. We have reclassified certain prior period amounts to be consistent with the current period presentation, which we believe is more meaningful to readers of our consolidated financial statements. This information speaks only as of the particular date or dates included in the schedules. We do not undertake any obligation to, and disclaim any duty to, correct or update any of the information provided in this Financial Supplement. Our future financial performance is subject to risks and uncertainties as described in our United States Securities and Exchange Commission (SEC) filings.

BUSINESS
PNC is one of the largest diversified financial services companies in the United States (U.S) and is headquartered in Pittsburgh, Pennsylvania. PNC has businesses engaged in retail banking, including residential mortgage, corporate and institutional banking and asset management, providing many of its products and services nationally. PNC's retail branch network is located primarily in markets across the Mid-Atlantic, Midwest and Southeast. PNC also has strategic international offices in four countries outside the U.S.

DISCONTINUED OPERATIONS
On May 15, 2020, PNC completed the sale of its 31.6 million shares of BlackRock, Inc., common and preferred stock through a registered secondary offering. In addition, BlackRock repurchased 2.65 million shares from PNC. The total proceeds from the sale were $14.2 billion in cash, net of $0.2 billion in expenses, and resulted in a gain on sale of $4.3 billion. Additionally, PNC contributed 500,000 BlackRock shares to the PNC Foundation on May 18, 2020. As a result, PNC has divested its entire holding in BlackRock. PNC and its affiliates only hold shares of BlackRock stock in a fiduciary capacity for clients of PNC and its affiliates. Activity for BlackRock for all periods presented on the Consolidated Income Statement have been reclassified to discontinued operations and prior period BlackRock investment balances have been reclassified to the Asset held for sale line on the Consolidated Balance Sheet in accordance with Accounting Standard Codification (ASC) 205-20, Presentation of Financial Statements - Discontinued Operations.

PENDING ACQUISITION OF BBVA USA BANCSHARES, INC.
On November 16, 2020, PNC announced the signing of a definitive agreement with BBVA, S.A. to acquire BBVA USA Bancshares, Inc., a U.S. financial holding company conducting its business operations primarily through its U.S. banking subsidiary, BBVA USA for a fixed purchase price of $11.6 billion in cash. BBVA USA has over 600 branches in Texas, Alabama, Arizona, California, Florida, Colorado and New Mexico. The transaction is expected to add approximately $102 billion in total assets, $86 billion of deposits and $66 billion of loans to PNC's Consolidated Balance Sheet and to close in mid-2021, subject to customary closing conditions, including receipt of regulatory approvals.


THE PNC FINANCIAL SERVICES GROUP, INC.
Cross Reference Index to First Quarter 2021 Financial Supplement (Unaudited)
Financial Supplement Table Reference
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THE PNC FINANCIAL SERVICES GROUP, INC.

Page 1

Table 1: Consolidated Income Statement (Unaudited)
Three months ended
March 31December 31September 30June 30March 31
In millions, except per share data20212020202020202020
Interest Income
Loans$1,996 $2,074 $2,116 $2,257 $2,480 
Investment securities421 442 490 527 582 
Other66 60 70 71 138 
Total interest income2,483 2,576 2,676 2,855 3,200 
Interest Expense
Deposits40 53 74 141 375 
Borrowed funds95 99 118 187 314 
Total interest expense135 152 192 328 689 
Net interest income2,348 2,424 2,484 2,527 2,511 
Noninterest Income
Asset management226 221 215 199 201 
Consumer services384 387 390 330 377 
Corporate services 555 650 479 512 526 
Residential mortgage105 99 137 158 210 
Service charges on deposits119 134 119 79 168 
Other (a)483 293 457 271 343 
Total noninterest income1,872 1,784 1,797 1,549 1,825 
Total revenue4,220 4,208 4,281 4,076 4,336 
Provision For (Recapture of) Credit Losses(551)(254)52 2,463 914 
Noninterest Expense
Personnel1,477 1,521 1,410 1,373 1,369 
Occupancy215 215 205 199 207 
Equipment293 296 292 301 287 
Marketing45 64 67 47 58 
Other544 612 557 595 622 
Total noninterest expense2,574 2,708 2,531 2,515 2,543 
Income (loss) from continuing operations before income taxes and noncontrolling interests2,197 1,754 1,698 (902)879 
Income taxes (benefit) from continuing operations371 298 166 (158)120 
Net income (loss) from continuing operations1,826 1,456 1,532 (744)759 
Income from discontinued operations before taxes5,596 181 
Income taxes from discontinued operations1,197 25 
Net income from discontinued operations4,399 156 
Net income1,826 1,456 1,532 3,655 915 
Less: Net income attributable to noncontrolling interests10 14 13 7 7 
Preferred stock dividends (b)57 48 63 55 63 
Preferred stock discount accretion and redemptions1 1 1 1 1 
Net income attributable to common shareholders$1,758 $1,393 $1,455 $3,592 $844 
Earnings Per Common Share
Basic earnings (loss) from continuing operations$4.11 $3.26 $3.40 $(1.90)$1.59 
Basic earnings from discontinued operations 10.28 0.37 
Total basic earnings$4.11 $3.26 $3.40 $8.40 $1.96 
Diluted earnings (loss) from continuing operations$4.10 $3.26 $3.39 $(1.90)$1.59 
Diluted earnings from discontinued operations10.28 0.36 
Total diluted earnings$4.10 $3.26 $3.39 $8.40 $1.95 
Average Common Shares Outstanding
Basic426 425 426 426 429 
Diluted426 426 426 426 430 
Efficiency61 %64 %59 %62 %59 %
Noninterest income to total revenue44 %42 %42 %38 %42 %
Effective tax rate from continuing operations (c)16.9 %17.0 %9.8 %17.5 %13.7 %
(a)Includes net gains on sales of securities of $25 million, $51 million, $32 million, $40 million and $182 million for the quarters ended March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, respectively.
(b)Dividends are payable quarterly other than Series O, Series R and Series S preferred stock, which are payable semiannually, with the Series O payable in different quarters than the Series R and Series S preferred stock.
(c)The effective income tax rates are generally lower than the statutory rate due to the relationship of pretax income to tax credits and earnings that are not subject to tax.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 2
Table 2: Consolidated Balance Sheet (Unaudited)
March 31December 31September 30June 30March 31
In millions, except par value20212020202020202020
Assets
Cash and due from banks$7,455 $7,017 $6,629 $6,338 $7,493 
Interest-earning deposits with banks (a)86,161 85,173 70,959 50,233 19,986 
Loans held for sale (b)1,967 1,597 1,787 1,443 1,693 
Asset held for sale (c)8,511 
Investment securities – available for sale 96,799 87,358 89,747 97,052 89,077 
Investment securities – held to maturity1,456 1,441 1,438 1,441 1,469 
Loans (b)237,013 241,928 249,279 258,236 264,643 
Allowance for loan and lease losses (4,714)(5,361)(5,751)(5,928)(3,944)
Net loans232,299 236,567 243,528 252,308 260,699 
Equity investments6,386 6,052 4,938 4,943 4,694 
Mortgage servicing rights1,680 1,242 1,113 1,067 1,082 
Goodwill9,317 9,233 9,233 9,233 9,233 
Other (b) 30,894 30,999 32,445 34,920 41,556 
Total assets$474,414 $466,679 $461,817 $458,978 $445,493 
Liabilities
Deposits
Noninterest-bearing$120,641 $112,637 $107,281 $99,458 $81,614 
Interest-bearing254,426 252,708 247,798 246,539 223,590 
Total deposits375,067 365,345 355,079 345,997 305,204 
Borrowed funds
Federal Home Loan Bank borrowings1,500 3,500 5,500 8,500 23,491 
Bank notes and senior debt22,139 24,271 26,839 27,704 31,438 
Subordinated debt6,241 6,403 6,465 6,500 6,475 
Other (b)3,150 3,021 3,306 4,322 11,995 
Total borrowed funds33,030 37,195 42,110 47,026 73,399 
Allowance for unfunded lending related commitments 507 584 689 662 450 
Accrued expenses and other liabilities11,931 9,514 10,629 12,345 17,150 
Total liabilities420,535 412,638 408,507 406,030 396,203 
Equity
Preferred stock (d)
Common stock - $5 par value
Authorized 800 shares, issued 543, 543, 542, 542, and 542 shares2,713 2,713 2,712 2,712 2,712 
Capital surplus15,879 15,884 15,836 16,284 16,288 
Retained earnings48,113 46,848 45,947 44,986 41,885 
Accumulated other comprehensive income1,290 2,770 2,997 3,069 2,518 
Common stock held in treasury at cost:118, 119, 118, 117 and 118 shares(14,146)(14,205)(14,216)(14,128)(14,140)
Total shareholders’ equity53,849 54,010 53,276 52,923 49,263 
Noncontrolling interests30 31 34 25 27 
Total equity53,879 54,041 53,310 52,948 49,290 
Total liabilities and equity$474,414 $466,679 $461,817 $458,978 $445,493 

(a)Amounts include balances held with the Federal Reserve Bank of Cleveland of $85.8 billion, $84.9 billion, $70.6 billion, $50.0 billion and $19.6 billion as of March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, respectively.
(b)Amounts include assets and liabilities for which PNC has elected the fair value option. Our 2020 Form 10-K included, and our first quarter 2021 Form 10-Q will include, additional information regarding these items.
(c)Represents our held for sale investment in BlackRock. In the second quarter of 2020, PNC divested its entire holding in BlackRock. Prior period BlackRock investment balances have been reclassified to the Asset held for sale line in accordance with Accounting Standards Codification 205-20, Presentation of Financial Statements - Discontinued Operations. Our 2020 Form 10-K included additional information related to this divestiture.
(d)Par value less than $0.5 million at each date.



THE PNC FINANCIAL SERVICES GROUP, INC.

Page 3
Table 3: Average Consolidated Balance Sheet (Unaudited) (a)
Three months ended
March 31December 31September 30June 30March 31
In millions20212021202020202020
Assets
Interest-earning assets:
Investment securities
Securities available for sale
Residential mortgage-backed
Agency$45,298 $48,036 $52,215 $52,500 $49,636 
Non-agency1,236 1,3371,4371,5291,617
Commercial mortgage-backed6,2416,5686,9277,2326,734
Asset-backed5,3045,0175,0335,3095,003
U.S. Treasury and government agencies22,30918,78318,72415,45715,938
Other4,5614,5614,7234,9524,024
Total securities available for sale84,94984,30289,05986,97982,952
Securities held to maturity
Asset-backed2251
U.S. Treasury and government agencies797793788783779
Other650650655646640
Total securities held to maturity1,4471,4431,4431,4511,470
Total investment securities86,39685,74590,50288,43084,422
Loans
Commercial and industrial129,996134,944139,795153,595128,723
Commercial real estate28,59828,99129,08128,70728,275
Equipment lease financing6,3326,3806,7717,0357,066
Consumer50,90452,87254,69256,48557,680
Residential real estate22,30522,63822,75322,29221,828
Total loans238,135245,825253,092268,114243,572
Interest-earning deposits with banks (b)85,41076,37460,32734,60017,569
Other interest-earning assets7,8298,1349,75210,8679,468
Total interest-earning assets417,770416,078413,673402,011355,031
Noninterest-earning assets50,45048,90148,46655,30257,405
Total assets$468,220 $464,979 $462,139 $457,313 $412,436 
Liabilities and Equity
Interest-bearing liabilities:
Interest-bearing deposits
Money market$59,083 $62,621 $63,598 $61,346 $53,287 
Demand91,61988,02687,22682,88170,931
Savings82,92679,43077,47975,34569,977
Time deposits18,44919,44820,24821,87321,141
Total interest-bearing deposits252,077249,525248,551241,445215,336
Borrowed funds
Federal Home Loan Bank borrowings2,4114,7617,19612,55913,440
Bank notes and senior debt22,79924,02225,85828,29829,988
Subordinated debt5,9295,9365,9365,9375,934
Other4,0573,4334,3546,4357,826
Total borrowed funds35,19638,15243,34453,22957,188
Total interest-bearing liabilities287,273287,677291,895294,674272,524
Noninterest-bearing liabilities and equity:
Noninterest-bearing deposits113,299109,878101,93193,77674,396
Accrued expenses and other liabilities14,25814,34815,34116,98916,437
Equity53,39053,07652,97251,87449,079
Total liabilities and equity$468,220 $464,979 $462,139 $457,313 $412,436 

(a)Calculated using average daily balances.
(b)Amounts include average balances held with the Federal Reserve Bank of Cleveland of $85.2 billion, $76.1 billion, $60.0 billion, $34.2 billion and $17.3 billion for the three months ended March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020, respectively.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 4
Table 4: Details of Net Interest Margin (Unaudited)
Three months ended
March 31December 31September 30June 30March 31
20212020202020202020
Average yields/rates (a)
Yield on interest-earning assets
Investment securities
Securities available for sale
Residential mortgage-backed
Agency1.72 %1.81 %2.03 %2.29 %2.63 %
Non-agency7.24 %7.15 %7.26 %7.13 %7.87 %
Commercial mortgage-backed2.58 %2.66 %2.50 %2.59 %2.95 %
Asset-backed1.84 %2.04 %2.44 %2.60 %3.05 %
U.S. Treasury and government agencies1.68 %1.77 %1.64 %1.77 %2.29 %
Other3.28 %3.45 %3.39 %3.47 %3.69 %
Total securities available for sale1.95 %2.05 %2.16 %2.39 %2.77 %
Securities held to maturity
Asset-backed2.38 %2.77 %
U.S. Treasury and government agencies2.83 %2.88 %2.86 %2.84 %2.84 %
Other4.17 %4.20 %4.20 %4.27 %4.48 %
Total securities held to maturity3.43 %3.47 %3.47 %3.47 %3.56 %
Total investment securities1.97 %2.08 %2.18 %2.41 %2.78 %
Loans
Commercial and industrial2.91 %2.87 %2.82 %2.83 %3.62 %
Commercial real estate2.80 %2.63 %2.65 %2.84 %3.64 %
Equipment lease financing3.90 %3.90 %3.80 %3.82 %3.93 %
Consumer4.78 %4.74 %4.69 %4.86 %5.38 %
Residential real estate3.53 %3.69 %3.74 %3.86 %3.96 %
Total loans3.38 %3.35 %3.32 %3.37 %4.08 %
Interest-earning deposits with banks0.10 %0.10 %0.10 %0.10 %1.27 %
Other interest-earning assets2.34 %1.99 %2.23 %2.26 %3.51 %
Total yield on interest-earning assets2.40 %2.46 %2.57 %2.85 %3.62 %
Rate on interest-bearing liabilities
Interest-bearing deposits
Money market0.03 %0.05 %0.07 %0.15 %0.72 %
Demand0.04 %0.04 %0.05 %0.08 %0.41 %
Savings0.06 %0.08 %0.11 %0.31 %0.79 %
Time deposits0.32 %0.41 %0.58 %0.80 %1.34 %
Total interest-bearing deposits0.06 %0.08 %0.12 %0.23 %0.70 %
Borrowed funds
Federal Home Loan Bank borrowings0.43 %0.40 %0.47 %1.00 %1.69 %
Bank notes and senior debt1.04 %1.00 %1.08 %1.56 %2.41 %
Subordinated debt1.43 %1.38 %1.51 %1.91 %2.73 %
Other
1.21 %1.39 %1.31 %0.92 %1.69 %
Total borrowed funds1.09 %1.02 %1.06 %1.39 %2.18 %
Total rate on interest-bearing liabilities0.19 %0.21 %0.26 %0.44 %1.00 %
Interest rate spread2.21 %2.25 %2.31 %2.41 %2.62 %
Benefit from use of noninterest bearing sources (b)0.06 0.07 0.08 0.11 0.22 
Net interest margin2.27 %2.32 %2.39 %2.52 %2.84 %

(a)Yields and rates are calculated using the applicable annualized interest income or interest expense divided by the applicable average earning assets or interest-bearing liabilities. Net interest margin is the total yield on interest-earning assets minus the total rate on interest-bearing liabilities and includes the benefit from use of noninterest-bearing sources. To provide more meaningful comparisons of net interest margins, we use net interest income on a taxable-equivalent basis in calculating average yields used in the calculation of net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP in the Consolidated Income Statement. The taxable-equivalent adjustments to net interest income for the three months ended March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020 and March 31, 2020 were $15 million, $17 million, $17 million, $19 million and $22 million, respectively.
(b)Represents the positive effects of investing noninterest-bearing sources in interest-earning assets.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 5
Table 5: Per Share Related Information (Unaudited)
Three months ended
March 31December 31September 30June 30March 31
In millions, except per share data20212020202020202020
Basic
Net income (loss) from continuing operations$1,826 $1,456 $1,532 $(744)$759 
Less:
Net income attributable to noncontrolling interests10 14 13 7 7 
Preferred stock dividends57 48 63 55 63 
Preferred stock discount accretion and redemptions1 1 1 1 1 
Net income (loss) from continuing operations attributable to common
shareholders		1,758 1,393 1,455 (807)688 
Less: Dividends and undistributed earnings allocated to nonvested
restricted shares		8 6 8 1 3 
Net income (loss) from continuing operations attributable to basic common
shareholders		$1,750 $1,387 $1,447 $(808)$685 
Net income from discontinued operations attributable to common
shareholders		$4,399 $156 
Less: Undistributed earnings allocated to nonvested restricted shares  21 1 
Net income from discontinued operations attributable to basic common
shareholders		  $4,378 $155 
Basic weighted-average common shares outstanding426 425 426 426 429 
Basic earnings (loss) per common share from continuing operations (a)$4.11 $3.26 $3.40 $(1.90)$1.59 
Basic earnings per common share from discontinued operations (a)$10.28 $0.37 
Basic earnings per common share$4.11 $3.26 $3.40 $8.40 $1.96 
Diluted
Net income (loss) from continuing operations attributable to diluted common
shareholder		$1,750 $1,387 $1,447 $(808)$685 
Net income from discontinued operations attributable to basic common
shareholders		  $4,378 $155 
Less: Impact of earnings per share dilution from discontinued operations  1 1 
Net income from discontinued operations attributable to diluted common
shareholders		  $4,377 $154 
Basic weighted-average common shares outstanding426 425 426 426 429 
Dilutive potential common shares1 1 
Diluted weighted-average common shares outstanding426 426 426 426 430 
Diluted earnings (loss) per common share from continuing operations (a)$4.10 $3.26 $3.39 $(1.90)$1.59 
Diluted earnings per common share from discontinued operations (a)$10.28 $0.36 
Diluted earnings per common share $4.10 $3.26 $3.39 $8.40 $1.95 

(a)Dividends are payable quarterly other than the Series O, Series R and Series S preferred stock, which are payable semiannually, with the Series O payable in different quarters than the Series R and Series S preferred stock.



THE PNC FINANCIAL SERVICES GROUP, INC.

Page 6
Table 6: Details of Loans (Unaudited)
March 31December 31September 30June 30March 31
In millions20212020202020202020
Commercial
Commercial and industrial
Retail/wholesale trade$20,349 $20,218 $20,287 $21,747 $24,408 
Manufacturing20,03220,71222,55125,59027,225
Service providers19,40319,41920,26021,34719,411
Financial services13,38214,90915,00513,59613,473
Real estate related (a)13,05213,36914,04014,63414,843
Health care8,7418,9879,36810,1099,238
Transportation and warehousing6,7517,0957,2957,7718,160
Other industries28,08827,36428,38129,54132,373
Total commercial and industrial129,798132,073137,187144,335149,131
Commercial real estate28,31928,71629,02828,76328,544
Equipment lease financing6,3896,4146,4797,0977,061
Total commercial164,506167,203172,694180,195184,736
Consumer
Home equity23,49324,08824,53924,87925,081
Residential real estate22,41822,56022,88622,46922,250
Automobile13,58414,21814,97716,15717,194
Credit card5,6756,2156,3036,5757,132
Education2,8422,9463,0513,1323,247
Other consumer4,4954,6984,8294,8295,003
Total consumer72,50774,72576,58578,04179,907
Total loans$237,013 $241,928 $249,279 $258,236 $264,643 

(a) Represents loans to customers in the real estate and construction industries.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 7
Allowance for Credit Losses (Unaudited)

Table 7: Change in Allowance for Loan and Lease Losses
Three months ended
March 31December 31September 30June 30March 31
Dollars in millions20212020202020202020
Allowance for loan and lease losses
Beginning balance$5,361 $5,751 $5,928 $3,944 $2,742 
Adoption of ASU 2016-03 (a)463 
Gross charge-offs:
Commercial and industrial(59)(133)(59)(112)(78)
Commercial real estate(5)(1)(1)
Equipment lease financing(5)(4)(4)(10)(5)
Home equity(7)(11)(12)(8)(11)
Residential real estate(4)(6)(2)(2)
Automobile(52)(55)(57)(69)(84)
Credit card(69)(72)(74)(76)(78)
Education(5)(3)(3)(4)(6)
Other consumer(37)(42)(35)(35)(40)
Total gross charge-offs(243)(327)(247)(314)(304)
Recoveries:
Commercial and industrial14 23 21 13 18 
Commercial real estate1 3 2 4 
Equipment lease financing3 3 3 2 2 
Home equity17 17 15 15 14 
Residential real estate5 4 4 4 4 
Automobile38 33 31 29 35 
Credit card12 9 9 9 8 
Education2 2 2 2 2 
Other consumer5 4 5 4 5 
Total recoveries97 98 92 78 92 
Net (charge-offs) / recoveries:
Commercial and industrial(45)(110)(38)(99)(60)
Commercial real estate(4)2 1 4 
Equipment lease financing(2)(1)(1)(8)(3)
Home equity10 6 3 7 3 
Residential real estate1 (2)2 4 2 
Automobile(14)(22)(26)(40)(49)
Credit card(57)(63)(65)(67)(70)
Education(3)(1)(1)(2)(4)
Other consumer(32)(38)(30)(31)(35)
Total net (charge-offs)(146)(229)(155)(236)(212)
Provision for (recapture of) credit losses (b)(502)(164)(23)2,220 952 
Other1 3 1 (1)
Ending balance$4,714 $5,361 $5,751 $5,928 $3,944 
Supplemental Information
Net charge-offs
Commercial net charge-offs$(51)$(109)$(38)$(107)$(59)
Consumer net charge-offs(95)(120)(117)(129)(153)
Total net charge-offs$(146)$(229)$(155)$(236)$(212)
Net charge-offs to average loans (annualized)0.25 %0.37 %0.24 %0.35 %0.35 %
Commercial0.13 %0.25 %0.09 %0.23 %0.14 %
Consumer0.53 %0.63 %0.60 %0.66 %0.77 %

(a)    Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2020, and our transition from an incurred loss methodology for our reserves to an expected credit loss methodology. Our 2020 Form 10-K included additional information related to our adoption of the CECL standard.
(b)    See Table 8 for the components of the Provision for (recapture of) credit losses being reported on the Consolidated Income Statement.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 8
Allowance for Credit Losses (Unaudited) (Continued)

Table 8: Components of the Provision for (Recapture of) Credit Losses
Three months ended
March 31December 31September 30June 30March 31
In millions20212020202020202020
Provision for (recapture of) credit losses
Loans and leases$(502)$(164)$(23)$2,220 $952 
Unfunded lending related commitments(77)(105)27 212 (47)
Investment securities 26 11 39 30 
Other financial assets2 4 9 1 9 
Total provision for (recapture of) credit losses$(551)$(254)$52 $2,463 $914 

Table 9: Allowance for Credit Losses by Loan Class (a)
March 31, 2021December 31, 2020

Dollars in millions		Allowance AmountTotal Loans% of Total LoansAllowance AmountTotal Loans% of Total Loans
Allowance for loan and lease losses
Commercial
Commercial and industrial$1,815 $129,798 1.40 %$2,300 $132,073 1.74 %
Commercial real estate1,126 28,319 3.98 %880 28,716 3.06 %
Equipment lease financing142 6,389 2.22 %157 6,414 2.45 %
Total commercial3,083 164,506 1.87 %3,337 167,203 2.00 %
Consumer
Home equity239 23,493 1.02 %313 24,088 1.30 %
Residential real estate(17)22,418 (0.08)%28 22,560 0.12 %
Automobile344 13,584 2.53 %379 14,218 2.67 %
Credit card693 5,675 12.21 %816 6,215 13.13 %
Education112 2,842 3.94 %129 2,946 4.38 %
Other consumer260 4,495 5.78 %359 4,698 7.64 %
Total consumer1,631 72,507 2.25 %2,024 74,725 2.71 %
Total
4,714 $237,013 1.99 %5,361 $241,928 2.22 %
Allowance for unfunded lending related commitments
507 584 
Allowance for credit losses
$5,221 $5,945 
Supplemental Information
Allowance for credit losses to total loans
2.20 %2.46 %
Commercial2.12 %2.29 %
Consumer2.39 %2.84 %

(a)    Excludes allowances for investment securities and other financial assets, which together totaled $136 million and $109 million at March 31, 2021 and December 31, 2020,
    respectively.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 9
Details of Nonperforming Assets (Unaudited)

Table 10: Nonperforming Assets by Type
March 31December 31September 30June 30March 31
Dollars in millions20212020202020202020
Nonperforming loans, including TDRs
Commercial
Commercial and industrial
Retail/wholesale trade$66 $61 $90 $117 $121 
Manufacturing55 81 80 58 79 
Service providers79 90 69 57 63 
Real estate related (a)48 95 140 158 25 
Health care19 20 20 19 14 
Transportation and warehousing18 20 14 20 23 
Other industries227 299 264 264 169 
Total commercial and industrial512 666 677 693 494 
Commercial real estate221 224 217 43 42 
Equipment lease financing16 33 21 22 30 
Total commercial749 923 915 758 566 
Consumer (b)
Home equity656 645 639 636 617 
Residential real estate541 528 339 305 292 
Automobile178 175 171 156 154 
Credit card7 8 13 15 10 
Other consumer7 7 8 6 5 
Total consumer1,389 1,363 1,170 1,118 1,078 
Total nonperforming loans (c) 2,138 2,286 2,085 1,876 1,644 
OREO and foreclosed assets41 51 67 79 111 
Total nonperforming assets$2,179 $2,337 $2,152 $1,955 $1,755 
Nonperforming loans to total loans0.90 %0.94 %0.84 %0.73 %0.62 %
Nonperforming assets to total loans, OREO and foreclosed assets0.92 %0.97 %0.86 %0.76 %0.66 %
Nonperforming assets to total assets0.46 %0.50 %0.47 %0.43 %0.39 %
Allowance for loan and lease losses to nonperforming loans 220 %235 %276 %316 %240 %
(a)Represents loans related to customers in the real estate and construction industries.
(b)Excludes most unsecured consumer loans and lines of credit, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.
(c)Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale and loans accounted for under the fair value option.





THE PNC FINANCIAL SERVICES GROUP, INC.

Page 10
Details of Nonperforming Assets (Unaudited) (Continued)

Table 11: Change in Nonperforming Assets
January 1, 2021 -October 1, 2020 -July 1, 2020 -April 1, 2020 -January 1, 2020 -
In millionsMarch 31, 2021December 31, 2020September 30, 2020June 30, 2020March 31, 2020
Beginning balance$2,337 $2,152 $1,955 $1,755 $1,752 
New nonperforming assets249 586 512 458 391 
Charge-offs and valuation adjustments(70)(97)(75)(104)(145)
Principal activity, including paydowns and payoffs(186)(185)(175)(85)(158)
Asset sales and transfers to loans held for sale(86)(14)(20)(28)(20)
Returned to performing status(65)(105)(45)(41)(65)
Ending balance$2,179 $2,337 $2,152 $1,955 $1,755 


Table 12: Largest Individual Nonperforming Assets (a)
March 31, 2021 - Dollars in millions
RankingOutstandingsIndustry
1$141 Real Estate and Rental and Leasing
238 Wholesale Trade
331 Real Estate and Rental and Leasing
429 Real Estate and Rental and Leasing
528 Real Estate and Rental and Leasing
624 Mining, Quarrying, and Oil and Gas Extraction
724 Mining, Quarrying, and Oil and Gas Extraction
822 Mining, Quarrying, and Oil and Gas Extraction
922 Information
1020 Mining, Quarrying, and Oil and Gas Extraction
Total$379 
As a percent of total nonperforming assets17%

(a)    Amounts shown are not net of related allowance for loan and lease losses, if applicable.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 11
Accruing Loans Past Due (Unaudited)                  

Pursuant to the interagency guidance issued in April 2020 and in connection with the credit reporting rules from the U.S. Coronavirus Aid, Relief and Economic Security Act (CARES Act), the delinquency status of loans modified due to COVID-19 related hardships are reported as of March 31, 2021, December 31, 2020, September 30, 2020 and June 30, 2020 in alignment with the rules set forth for banks to report delinquency status to the credit agencies. These rules require that COVID-19 related loan modifications be reported as follows:
•if current at the time of modification, the loan remains current throughout the modification period,
•if delinquent at the time of modification and the borrower was not made current as part of the modification, the loan maintains its reported as delinquent status during the modification period, or
•if delinquent at the time of modification and the borrower was made current as part of the modification or became current during the modification period, the loan is reported as current.
As a result, certain loans modified due to COVID-19 related hardships are not being reported as past due as of March 31, 2021, December 31, 2020, September 30, 2020 and June 30, 2020 based on the contractual terms of the loan, even where borrowers may not be making payments on their loans during the modification period. Our 2020 Form 10-K included, and our first quarter 2021 Form 10-Q will include, additional information on COVID-19 related loan modifications.

Table 13: Accruing Loans Past Due 30 to 59 Days (a)
AmountPercent of Total Outstandings
Mar. 31Dec. 31Sept. 30Jun. 30Mar. 31Mar. 31Dec. 31Sept. 30Jun. 30Mar. 31
Dollars in millions2021202020202020202020212020202020202020
Commercial and industrial$80 $106 $56 $49 $97 0.06 %0.08 %0.04 %0.03 %0.07 %
Commercial real estate12 6 6 51 6 0.04 %0.02 %0.02 %0.18 %0.02 %
Equipment lease financing21 31 7 8 42 0.33 %0.48 %0.11 %0.11 %0.59 %
Home equity43 50 48 70 65 0.18 %0.21 %0.20 %0.28 %0.26 %
Residential real estate
Non government insured61 89 99 135 121 0.27 %0.39 %0.43 %0.60 %0.54 %
Government insured101 92 89 63 52 0.45 %0.41 %0.39 %0.28 %0.23 %
Automobile76 134 116 105 177 0.56 %0.94 %0.77 %0.65 %1.03 %
Credit card31 43 44 53 59 0.55 %0.69 %0.70 %0.81 %0.83 %
Education
Non government insured
6 5 6 3 7 0.21 %0.17 %0.20 %0.10 %0.22 %
Government insured
43 50 51 36 45 1.51 %1.70 %1.67 %1.15 %1.39 %
Other consumer11 14 17 17 17 0.24 %0.30 %0.35 %0.35 %0.34 %
Total$485 $620 $539 $590 $688 0.20 %0.26 %0.22 %0.23 %0.26 %
Table 14: Accruing Loans Past Due 60 to 89 Days (a)
AmountPercent of Total Outstandings
Mar. 31Dec. 31Sept. 30Jun. 30Mar. 31Mar. 31Dec. 31Sept. 30Jun. 30Mar. 31
Dollars in millions2021202020202020202020212020202020202020
Commercial and industrial$13 $26 $37 $28 $22 0.01 %0.02 %0.03 %0.02 %0.01 %
Commercial real estate1 1 6 4 1 0.00 %0.00 %0.02 %0.01 %0.00 %
Equipment lease financing1 5 4 9 2 0.02 %0.08 %0.06 %0.13 %0.03 %
Home equity20 21 22 27 28 0.09 %0.09 %0.09 %0.11 %0.11 %
Residential real estate
Non government insured13 16 22 34 30 0.06 %0.07 %0.10 %0.15 %0.13 %
Government insured60 62 58 59 52 0.27 %0.27 %0.25 %0.26 %0.23 %
Automobile19 34 32 34 49 0.14 %0.24 %0.21 %0.21 %0.28 %
Credit card24 30 33 38 37 0.42 %0.48 %0.52 %0.58 %0.52 %
Education
Non government insured
3 2 2 2 4 0.11 %0.07 %0.07 %0.06 %0.12 %
Government insured
22 27 24 21 26 0.77 %0.92 %0.79 %0.67 %0.80 %
Other consumer6 10 11 8 10 0.13 %0.21 %0.23 %0.17 %0.20 %
Total$182 $234 $251 $264 $261 0.08 %0.10 %0.10 %0.10 %0.10 %


THE PNC FINANCIAL SERVICES GROUP, INC.

Page 12
Accruing Loans Past Due (Unaudited) (Continued)

Table 15: Accruing Loans Past Due 90 Days or More (a)
AmountPercent of Total Outstandings
Mar. 31Dec. 31Sept. 30Jun. 30Mar. 31Mar. 31Dec. 31Sept. 30Jun. 30Mar. 31
Dollars in millions2021202020202020202020212020202020202020
Commercial and industrial$63 $30 $36 $34 $51 0.05 %0.02 %0.03 %0.02 %0.03 %
Residential real estate
Non government insured17 27 28 19 18 0.08 %0.12 %0.12 %0.08 %0.08 %
Government insured258 292 241 245 282 1.15 %1.29 %1.05 %1.09 %1.27 %
Automobile6 12 12 19 19 0.04 %0.08 %0.08 %0.12 %0.11 %
Credit card52 60 60 61 70 0.92 %0.97 %0.95 %0.93 %0.98 %
Education
Non government insured
2 2 1 1 2 0.07 %0.07 %0.03 %0.03 %0.06 %
Government insured
74 75 62 65 82 2.60 %2.55 %2.03 %2.08 %2.53 %
Other consumer7 11 8 12 10 0.16 %0.23 %0.17 %0.25 %0.20 %
Total$479 $509 $448 $456 $534 0.20 %0.21 %0.18 %0.18 %0.20 %

(a) Excludes loans held for sale.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 13
Business Segment Descriptions (Unaudited)

Retail Banking provides deposit, lending, brokerage, insurance services, investment management and cash management products and services to consumer and small business customers. Our customers are serviced through our branch network, ATMs, call centers, online banking and mobile channels. The branch network is located primarily in markets across the Mid-Atlantic, Midwest and Southeast. In 2018, Retail Banking launched its national expansion strategy designed to grow customers with digitally-led banking and a thin branch network in markets outside of our existing retail branch network. Deposit products include checking, savings and money market accounts and certificates of deposit. Lending products include residential mortgages, home equity loans and lines of credit, auto loans, credit cards, education loans and personal and small business loans and lines of credit. The residential mortgage loans are directly originated within our branch network and nationwide, and are typically underwritten to agency and/or third-party standards, and either sold, servicing retained, or held on our balance sheet. Brokerage, investment management and cash management products and services include managed, education, retirement and trust accounts.

Corporate & Institutional Banking provides lending, treasury management, and capital markets-related products and services to mid-sized and large corporations, and government and not-for-profit entities. Lending products include secured and unsecured loans, letters of credit and equipment leases. The Treasury Management business provides payables, receivables, deposit and account services, liquidity and investments, and online and mobile banking products and services to our clients. Capital markets-related products and services include foreign exchange, derivatives, securities underwriting, loan syndications, mergers and acquisitions advisory and equity capital markets advisory related services. We also provide commercial loan servicing and technology solutions for the commercial real estate finance industry. Products and services are provided nationally.

Asset Management Group provides personal wealth management for high net worth and ultra high net worth clients and institutional asset management. The Asset Management group is comprised of three distinct operating units:
•Wealth management provides products and services to individuals and their families including investment and retirement planning, customized investment management, private banking, and trust management and administration for individuals and their families.
•Our Hawthorn unit provides multi-generational family planning including estate, financial, tax planning, fiduciary, investment management and consulting, private banking, personal administrative services, asset custody and customized performance reporting to ultra high net worth clients.
•Institutional asset management provides outsourced chief investment officer, custody, private real estate, cash and fixed income client solutions, and fiduciary retirement advisory services to institutional clients including corporations, healthcare systems, insurance companies, unions, municipalities and non-profits.

Table 16: Period End Employees
March 31December 31September 30June 30March 31
20212020202020202020
Full-time employees
Retail Banking27,690 27,621 27,808 29,051 28,737 
Other full-time employees22,281 21,928 21,997 21,752 21,776 
Total full-time employees49,971 49,549 49,805 50,803 50,513 
Part-time employees
Retail Banking1,697 1,611 1,593 1,854 1,780 
Other part-time employees101 97 104 476 129 
Total part-time employees1,798 1,708 1,697 2,330 1,909 
Total51,769 51,257 51,502 53,133 52,422 


THE PNC FINANCIAL SERVICES GROUP, INC.

Page 14
Table 17: Summary of Business Segment Net Income and Revenue (Unaudited) (a)
Three months ended
March 31December 31September 30June 30March 31
In millions20212020202020202020
Income
Retail Banking$607 $336 $530 $(223)$201 
Corporate & Institutional Banking1,058 992 670 (358)370 
Asset Management Group99 82 91 28 54 
Other52 32 228 (198)127 
Net income (loss) from continuing operations excluding noncontrolling
interest		$1,816 $1,442 $1,519 $(751)$752 
  
Revenue
Retail Banking$2,016 $1,853 $2,056 $1,975 $2,244 
Corporate & Institutional Banking1,808 1,913 1,748 1,790 1,660 
Asset Management Group322 316 310 293 292 
Other74 126 167 18 140 
Total revenue$4,220 $4,208 $4,281 $4,076 $4,336 

(a)Our business information is presented based on our internal management reporting practices. Net interest income in business segment results reflects PNC’s internal funds transfer pricing methodology. Assets receive a funding charge and liabilities and capital receive a funding credit based on a transfer pricing methodology that incorporates product repricing characteristics, tenor and other factors.


THE PNC FINANCIAL SERVICES GROUP, INC.

Page 15
Table 18: Retail Banking (Unaudited) (a)
Three months ended
March 31December 31September 30June 30March 31
Dollars in millions20212020202020202020
Income Statement
Net interest income$1,362 $1,380 $1,383 $1,390 $1,456 
Noninterest income654 473 673 585 788 
Total revenue2,016 1,853 2,056 1,975 2,244 
Provision for (recapture of) credit losses(257)(81)(157)761 445 
Noninterest expense1,476 1,482 1,512 1,497 1,528 
Pretax earnings (loss)797 452 701 (283)271 
Income taxes (benefit)183 105 162 (63)62 
Noncontrolling interest 7 11 9 3 8 
Earnings (loss)$607 $336 $530 $(223)$201 
Average Balance Sheet
Loans held for sale$891 $672 $700 $829 $779 
Loans
Consumer
Home equity$21,833 $22,366 $22,647 $22,790 $22,736 
Residential real estate 17,468 18,042 18,435 18,244 17,964 
Automobile13,890 14,536 15,573 16,688 17,096 
Credit card5,819 6,218 6,408 6,690 7,207 
Education2,938 3,027 3,119 3,218 3,343 
Other consumer1,898 2,086 2,262 2,454 2,533 
Total consumer 63,846 66,275 68,444 70,084 70,879 
Commercial 13,743 13,391 13,356 13,612 10,524 
Total loans$77,589 $79,666 $81,800 $83,696 $81,403 
Total assets$92,891 $94,303 $98,731 $102,103 $97,062 
Deposits
Noninterest-bearing demand$44,845 $43,818 $43,752 $39,134 $32,225 
Interest-bearing demand54,269 50,702 49,274 47,339 42,865 
Money market24,198 24,112 23,816 22,942 22,866 
Savings75,180 72,041 70,236 67,947 62,781 
Certificates of deposit9,742 10,156 10,852 11,661 12,233 
Total deposits$208,234 $200,829 $197,930 $189,023 $172,970 
Performance Ratios
Return on average assets2.65 %1.41 %2.13 %(0.88)%0.84 %
Noninterest income to total revenue32 %26 %33 %30 %35 %
Efficiency73 %80 %74 %76 %68 %
(a)See note (a) on page 14.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 16
Retail Banking (Unaudited) (Continued)
Three months ended
March 31December 31September 30June 30March 31
Dollars in millions, except as noted20212020202020202020
Supplemental Noninterest Income Information
Consumer services$368 $369 $371 $315 $372 
Residential mortgage$105 $99 $137 $158 $210 
Service charges on deposits$119 $133 $118 $80 $166 
Residential Mortgage Information
Residential mortgage servicing statistics (in billions, except as noted) (a)
Serviced portfolio balance (b)$117 $121 $119 $122 $118 
Serviced portfolio acquisitions$7 $12 $8 $11 $2 
MSR asset value (b)$1.0 $0.7 $0.6 $0.6 $0.6 
MSR capitalization value (in basis points) (b)83 56 50 47 51 
Servicing income: (in millions)
Servicing fees, net (c)$5 $13 $25 $36 $44 
Mortgage servicing rights valuation, net of economic hedge$14 $(1)$17 $20 $101 
Residential mortgage loan statistics
Loan origination volume (in billions)$4.3 $3.7 $4.0 $4.2 $3.2 
Loan sale margin percentage3.28 %3.75 %3.62 %3.67 %3.16 %
Percentage of originations represented by:
Purchase volume (d)34 %45 %44 %34 %36 %
Refinance volume66 %55 %56 %66 %64 %
Other Information (b)
Customer-related statistics (average)
Non-teller deposit transactions (e)66 %66 %67 %65 %59 %
Digital consumer customers (f)79 %77 %75 %73 %71 %
Credit-related statistics
Nonperforming assets$1,229 $1,211 $1,077 $1,037 $1,011 
Net charge-offs - loans and leases $108 $136 $125 $142 $166 
Other statistics
ATMs8,874 8,900 9,058 9,058 9,048 
Branches (g)2,137 2,162 2,207 2,256 2,277 
Brokerage account client assets (in billions) (h)$61 $59 $55 $53 $49 

(a)Represents mortgage loan servicing balances for third parties and the related income.
(b)Presented as of period end, except for average customer-related statistics and net charge-offs, which are both shown for the three months ended.
(c)Servicing fees net of impact of decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan payments, prepayments, and loans that were paid down or paid off during the period.
(d)Mortgages with borrowers as part of residential real estate purchase transactions.
(e)Percentage of total consumer and business banking deposit transactions processed at an ATM or through our mobile banking application.
(f)Represents consumer checking relationships that process the majority of their transactions through non-teller channels.
(g)Excludes stand-alone mortgage offices and satellite offices (e.g., drive-ups, electronic branches and retirement centers) that provide limited products and/or services.
(h)Includes cash and money market balances.


THE PNC FINANCIAL SERVICES GROUP, INC.

Page 17
Table 19: Corporate & Institutional Banking (Unaudited) (a)
Three months ended
March 31December 31September 30June 30March 31
Dollars in millions20212020202020202020
Income Statement
Net interest income$1,001 $994 $1,025 $1,064 $966 
Noninterest income807 919 723 726 694 
Total revenue1,808 1,913 1,748 1,790 1,660 
Provision for (recapture of) credit losses(282)(166)211 1,585 458 
Noninterest expense711 801 663 670 722 
Pretax earnings (loss)1,379 1,278 874 (465)480 
Income taxes (benefit)318 282 201 (110)110 
Noncontrolling interest 3 4 3 3 
Earnings (loss)$1,058 $992 $670 $(358)$370 
Average Balance Sheet
Loans held for sale$691 $1,039 $904 $704 $395 
Loans
Commercial
Commercial and industrial $114,944 $120,297 $125,187 $138,992 $117,288 
Commercial real estate27,182 27,509 27,511 27,106 26,589 
Equipment lease financing6,332 6,381 6,772 7,036 7,066 
Total commercial 148,458 154,187 159,470 173,134 150,943 
Consumer9 10 11 8 9 
Total loans$148,467 $154,197 $159,481 $173,142 $150,952 
Total assets$170,531 $177,792 $183,266 $199,254 $172,502 
Deposits
Noninterest-bearing demand$66,666 $64,334 $56,433 $53,157 $40,651 
Interest-bearing demand28,118 28,793 29,730 27,674 21,101 
Money market33,182 36,705 38,015 36,595 28,468 
Other8,368 8,928 8,956 9,546 7,868 
Total deposits$136,334 $138,760 $133,134 $126,972 $98,088 
Performance Ratios
Return on average assets2.52 %2.21 %1.45 %(0.72)%0.87 %
Noninterest income to total revenue45 %48 %41 %41 %42 %
Efficiency39 %42 %38 %37 %43 %
Other Information
Consolidated revenue from:
Treasury Management (b)$494 $472 $452 $469 $491 
Capital Markets (b)$403 $530 $345 $388 $344 
Commercial mortgage banking activities
Commercial mortgage loans held for sale (c)$30 $45 $46 $42 $29 
Commercial mortgage loan servicing income (d)90 82 76 67 69 
Commercial mortgage servicing rights valuation, net of economic hedge (e)17 14 16 22 20 
Total$137 $141 $138 $131 $118 
MSR asset value (f)$702 $569 $515 $490 $477 
Average loans by C&IB business
Corporate Banking$74,459 $76,664 $81,617 $91,634 $78,057 
Real Estate38,395 41,427 40,592 42,124 37,368 
Business Credit21,552 21,337 21,845 23,943 23,251 
Commercial Banking10,807 11,375 11,770 10,708 7,784 
Other3,254 3,394 3,657 4,733 4,492 
Total average loans$148,467 $154,197 $159,481 $173,142 $150,952 
Credit-related statistics
Nonperforming assets (f)$658 $827 $832 $674 $508 
Net charge-offs - loans and leases $44 $99 $32 $99 $50 

(a)See note (a) on page 14.
(b)Amounts reported in net interest income and noninterest income.
(c)Represents other noninterest income for valuations on commercial mortgage loans held for sale and related commitments, derivative valuations, originations fees, gains on sale of loans held for sale and net interest income on loans held for sale.
(d)Represents net interest income and noninterest income (primarily in corporate service fees) from loan servicing net of reduction in commercial mortgage servicing rights due to amortization expense and payoffs. Commercial mortgage servicing rights valuation, net of economic hedge is shown separately.
(e)Amounts are reported in corporate service fees.
(f)Presented as of period end.

THE PNC FINANCIAL SERVICES GROUP, INC.

Page 18
Table 20: Asset Management Group (Unaudited) (a)
Three months ended
March 31December 31September 30June 30March 31
Dollars in millions, except as noted20212020202020202020
Income Statement
Net interest income$93 $91 $89 $89 $88 
Noninterest income229 225 221 204 204 
Total revenue322 316 310 293 292 
Provision for (recapture of) credit losses (9)(2)(19)39 3 
Noninterest expense202 211 211 217 219 
Pretax earnings129 107 118 37 70 
Income taxes30 25 27 9 16 
Earnings$99 $82 $91 $28 $54 
Average Balance Sheet
Loans
Consumer
Residential real estate $3,635 $3,326 $2,976 $2,636 $2,385 
Other consumer4,008 4,077 4,065 3,975 4,052 
Total consumer 7,643 7,403 7,041 6,611 6,437 
Commercial756 774 810 883 856 
Total loans$8,399 $8,177 $7,851 $7,494 $7,293 
Total assets$8,873 $8,615 $8,361 $7,958 $7,801 
Deposits
Noninterest-bearing demand$1,754 $1,689 $1,692 $1,421 $1,468 
Interest-bearing demand9,104 8,404 8,101 7,742 6,850 
Money market1,520 1,606 1,542 1,597 1,709 
Savings7,747 7,388 7,243 7,398 7,197 
Other454 482 554 722 847 
Total deposits$20,579 $19,569 $19,132 $18,880 $18,071 
Performance Ratios
Return on average assets4.52 %3.78 %4.32 %1.41 %2.81 %
Noninterest income to total revenue71 %71 %71 %70 %70 %
Efficiency63 %67 %68 %74 %75 %
Other Information
Nonperforming assets (b)$68 $66 $39 $38 $34 
Net charge-offs (recoveries) - loans and leases  $1 $1 $(1)
Client Assets Under Administration (in billions) (b) (c)
Discretionary client assets under management$173 $170 $158 $151 $136 
Nondiscretionary client assets under administration161 154 142 138 128 
Total$334 $324 $300 $289 $264 
Discretionary client assets under management
Personal$110 $108 $99 $94 $84 
Institutional63 62 59 57 52 
Total$173 $170 $158 $151 $136 
(a)See note (a) on page 14.
(b)As of period end.
(c)Excludes brokerage account client assets.

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Glossary of Terms

2019 Tailoring Rules – Rules adopted by the federal banking agencies to better tailor the application of their capital, liquidity, and enhanced prudential requirements for banking organizations to the asset size and risk profile (as measured by certain regulatory metrics) of the banking organization. Effective January 1, 2020, the agencies' capital and liquidity rules classify all BHCs with $100 billion or more in total assets into one of four categories (Category I, Category II, Category III, and Category IV).

Adjusted average total assets - Primarily consisted of total average quarterly (or annual) assets plus/less unrealized losses (gains) on investment securities, less goodwill and certain other intangible assets (net of eligible deferred taxes).

Allowance for credit losses (ACL) – A valuation account that is deducted from or added to the amortized cost basis of the related
financial assets to present the net carrying value at the amount expected to be collected on the financial asset.

Amortized cost basis - Amount at which a financial asset is originated or acquired, adjusted for applicable accretion or amortization of premiums, discounts and net deferred fees or costs, collection of cash, charge-offs, foreign exchange and fair value hedge accounting adjustments.

Basel III common equity Tier 1 (CET1) capital (Tailoring Rules) - Common stock plus related surplus, net of treasury stock, plus retained earnings, less goodwill, net of associated deferred tax liabilities, less other disallowed intangibles, net of deferred tax liabilities and plus/less other adjustments. Investments in unconsolidated financial institutions, as well as mortgage servicing rights and deferred tax assets, must then be deducted to the extent such items (net of associated deferred tax liabilities) individually exceed 25% of our adjusted Basel III common equity Tier 1 capital.

Basel III common equity Tier 1 capital ratio - Common equity Tier 1 capital divided by period-end risk-weighted assets (as applicable).

Basel III Tier 1 capital - Common equity Tier 1 capital, plus qualifying preferred stock, plus certain trust preferred capital securities, plus certain noncontrolling interests that are held by others and plus/less other adjustments.

Basel III Tier 1 capital ratio - Tier 1 capital divided by period-end risk-weighted assets (as applicable).

Basel III Total capital - Tier 1 capital plus qualifying subordinated debt, plus certain trust preferred securities, plus, under the Basel III transitional rules and the standardized approach, the allowance for loan and lease losses included in Tier 2 capital and other.

Basel III Total capital ratio - Basel III Total capital divided by period-end risk-weighted assets (as applicable).

BBVA – BBVA USA Bancshares, Inc.

BBVA, S.A. – Banco Bilbao Vizcaya Argentaria, S.A.

BBVA USA – BBVA USA, the Alabama-chartered bank subsidiary of BBVA USA Bancshares, Inc.

BlackRock – BlackRock, Inc.

Charge-off - Process of removing a loan or portion of a loan from our balance sheet because it is considered uncollectible. We also record a charge-off when a loan is transferred from portfolio holdings to held for sale by reducing the loan carrying amount to the fair value of the loan, if fair value is less than carrying amount.

Common shareholders’ equity - Total shareholders' equity less the liquidation value of preferred stock.

Credit valuation adjustment - Represents an adjustment to the fair value of our derivatives for our own and counterparties’ non-performance risk.

Criticized commercial loans - Loans with potential or identified weaknesses based upon internal risk ratings that comply with the regulatory classification definitions of “Special Mention,” “Substandard” or “Doubtful.”

Current Expected Credit Loss (CECL) - Methodology for estimating the allowance for credit losses on in-scope financial assets held at amortized cost and unfunded lending related commitments which uses a combination of expected losses over a reasonable and supportable forecast period, a reversion period and long run average credit losses for their estimated contractual term.


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Discretionary client assets under management - Assets over which we have sole or shared investment authority for our customers/clients. We do not include these assets on our Consolidated Balance Sheet.

Earning assets - Assets that generate income, which include: interest-earning deposits with banks; loans held for sale; loans; investment securities; and certain other assets.

Effective duration - A measurement, expressed in years, that, when multiplied by a change in interest rates, would approximate the percentage change in value of on- and off- balance sheet positions.

Efficiency - Noninterest expense divided by total revenue.

Fair value - The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Fee income - Refers to the following categories within Noninterest income: Asset management; Consumer services; Corporate services; Residential mortgage; and Service charges on deposits.

FICO score - A credit bureau-based industry standard score created by Fair Isaac Co. which predicts the likelihood of borrower default. We use FICO scores both in underwriting and assessing credit risk in our consumer lending portfolio. Lower FICO scores indicate likely higher risk of default, while higher FICO scores indicate likely lower risk of default. FICO scores are updated on a periodic basis.

GAAP - Accounting principles generally accepted in the United States of America.

Leverage ratio - Basel III Tier 1 capital divided by average quarterly adjusted total assets.

Nondiscretionary client assets under administration - Assets we hold for our customers/clients in a nondiscretionary, custodial capacity. We do not include these assets on our Consolidated Balance Sheet.

Nonperforming assets - Nonperforming assets include nonperforming loans, OREO and foreclosed assets. We do not accrue interest income on assets classified as nonperforming.

Nonperforming loans - Loans accounted for at amortized cost whose credit quality has deteriorated to the extent that full collection of contractual principal and interest is not probable, including TDRs which have not returned to performing status. Interest income is not recognized on nonperforming loans. Nonperforming loans exclude certain government insured or guaranteed loans for which we expect to collect substantially all principal and interest, loans held for sale and loans accounted for under the fair value option.

Operating leverage - The period to period dollar or percentage change in total revenue less the dollar or percentage change in noninterest expense. A positive variance indicates that revenue growth exceeded expense growth (i.e., positive operating leverage) while a negative variance implies expense growth exceeded revenue growth (i.e., negative operating leverage).

Other real estate owned (OREO) and foreclosed assets - Assets taken in settlement of troubled loans primarily through deed-in-lieu of foreclosure or foreclosure. Foreclosed assets include real and personal property. Certain assets that have a government-guarantee which are classified as other receivables are excluded.

Purchased credit deteriorated assets (PCD) - Acquired loans or debt securities that, at acquisition, are determined to have experienced a more-than-insignificant deterioration in credit quality since origination or issuance.

Risk-weighted assets - Computed by the assignment of specific risk-weights (as defined by the Board of Governors of the Federal Reserve System) to assets and off-balance sheet instruments.

Servicing rights - Intangible assets or liabilities created by an obligation to service assets for others. Typical servicing rights include the right to receive a fee for collecting and forwarding payments on loans and related taxes and insurance premiums held in escrow.

Supplementary leverage ratio - Basel III Tier 1 capital divided by Supplementary leverage exposure.

Taxable-equivalent interest income - The interest income earned on certain assets that is completely or partially exempt from federal income tax. These tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of yields and margins for all interest-earning assets, we use interest income on a taxable-equivalent basis in calculating average yields and net interest margins by increasing the interest income earned on tax-exempt assets to make it fully equivalent to

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interest income earned on other taxable investments. This adjustment is not permitted under GAAP on the Consolidated Income Statement.

Troubled debt restructuring (TDR) - A loan whose terms have been restructured in a manner that grants a concession to a borrower experiencing financial difficulties.

Unfunded lending related commitments - Standby letters of credit, financial guarantees, commitments to extend credit and similar unfunded obligations that are not unilaterally, unconditionally, cancelable at PNC’s option.

Yield curve - A graph showing the relationship between the yields on financial instruments or market indices of the same credit quality with different maturities. For example, a “normal” or “positive” yield curve exists when long-term bonds have higher yields than short-term bonds. A “flat” yield curve exists when yields are the same for short-term and long-term bonds. A “steep” yield curve exists when yields on long-term bonds are significantly higher than on short-term bonds. An “inverted” or “negative” yield curve exists when short-term bonds have higher yields than long-term bonds.


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