PNC Bank 2004 Annual Report Download - page 4

TO OUR SHAREHOLDERS}
I am pleased to report that your company had an
excellent year in 2004 and is well positioned to thrive
in the years ahead. We are driven by a vision of PNC
as an industry leader – devoted to best-in-class
customer service and delivering strong growth with
moderate risk – and we are focused on bringing this
vision to reality.
In 2004 we earned $1.2 billion, a 20 percent increase over 2003. We made
steady gains across customer segments, which led to a 14 percent increase
in average loans and a 12 percent increase in average deposits. Our total
assets grew to $80 billion, an increase of 17 percent over 2003. Asset quality
improved dramatically. And assets under management increased eight
percent, while total assets serviced increased 13 percent, to $1.8 trillion.
In addition to this earnings and balance sheet growth, we made substantial
capital investments to expand the franchise. We successfully integrated New
Jersey-based United National Bancorp early in 2004. In July, we announced
the still-pending acquisition of Riggs National Corporation, a move that will
give us entrée into the extremely lucrative Washington, D.C. metropolitan
marketplace. And in January 2005 BlackRock, our asset management
company, closed its acquisition of SSRM Holdings, Inc.; that transaction
pushed assets under management at BlackRock to almost $400 billion.
Prudent management of our balance sheet underpinned our growth in 2004.
For the past several years, I have emphasized in this space that PNC would
resist the temptation of undue interest rate risk, that we would forego
short-term profits to ensure that we could avoid the value-destroying impact
of interest rate volatility. In 2004, those commitments were rewarded: While
many of our competitors suffered from rising interest rates, we did not.
22004 PNC Summary Annual Report
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ASSETS
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At December 31