PNC Bank 2006 Annual Report Download - page 103

Download and view the complete annual report

Please find page 103 of the 2006 PNC Bank annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 147

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147

Net Unfunded Credit Commitments
December 31 - in millions 2006 2005
Commercial $31,009 $27,774
Consumer 10,495 9,471
Commercial real estate 2,752 2,337
Other 579 596
Total $44,835 $40,178
Commitments to extend credit represent arrangements to lend
funds subject to specified contractual conditions. At
December 31, 2006, commercial commitments are reported
net of $8.3 billion of participations, assignments and
syndications, primarily to financial services companies. The
comparable amount at December 31, 2005 was $6.7 billion.
Commitments generally have fixed expiration dates, may
require payment of a fee, and contain termination clauses in
the event the customer’s credit quality deteriorates. Based on
our historical experience, most commitments expire unfunded,
and therefore cash requirements are substantially less than the
total commitment. Consumer home equity lines of credit
accounted for 74% of consumer unfunded credit
commitments.
As a result of deconsolidating Market Street in October 2005,
amounts related to Market Street were considered third party
unfunded commitments at December 31, 2006 and 2005.
These unfunded credit commitments totaled $5.6 billion at
December 31, 2006 and $4.6 billion at December 31, 2005
and are included in the preceding table primarily within the
“Commercial” and “Consumer” categories.
Net outstanding standby letters of credit totaled $4.4 billion at
December 31, 2006 and $4.2 billion at December 31, 2005.
Standby letters of credit commit us to make payments on
behalf of customers if certain specified future events occur.
Such instruments are typically issued to support industrial
revenue bonds, commercial paper, and bid-or-performance
related contracts. Maturities for standby letters of credit
ranged from 2007 to 2017. See Note 24 Commitments and
Guarantees for additional information.
At December 31, 2006, the largest industry concentration was
for general medical and surgical hospitals, which accounted
for approximately 5% of the total letters of credit and bankers’
acceptances.
At December 31, 2006, we pledged $1.3 billion of loans to the
FRB and $24.1 billion of loans to the Federal Home Loan
Bank (“FHLB”) as collateral for the contingent ability to
borrow, if necessary.
Certain directors and executive officers of PNC and its
subsidiaries, as well as certain affiliated companies of these
directors and officers, were customers of and had loans with
subsidiary banks in the ordinary course of business. All such
loans were on substantially the same terms, including interest
rates and collateral, as those prevailing at the time for
comparable transactions with other customers and did not
involve more than a normal risk of collectibility or present
other unfavorable features. The aggregate principal amounts
of these loans were $18 million at December 31, 2006 and $21
million at December 31, 2005. During 2006, new loans of $58
million were funded and repayments totaled $61 million.
93