PNC Bank 2006 Annual Report Download - page 76

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initiative, could affect our financial performance over
the next several years.
• Our ability to grow successfully through acquisitions
is impacted by a number of risks and uncertainties
related both to the acquisition transactions
themselves and to the integration of the acquired
businesses into PNC after closing. These
uncertainties are present in transactions such as our
pending acquisition of Mercantile Bankshares
Corporation.
• 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 affect matters such as business
generation and retention, our ability to attract and
retain management, liquidity and funding. These
legal and regulatory developments could include:
(a) the unfavorable resolution of legal proceedings or
regulatory and other governmental inquiries;
(b) increased litigation risk from recent regulatory
and other governmental developments; (c) the results
of the regulatory examination process, our failure to
satisfy the requirements of agreements with
governmental agencies, and regulators’ future use of
supervisory and enforcement tools; (d) legislative and
regulatory reforms, including changes to laws and
regulations involving tax, pension, and the protection
of confidential customer information; and (e) changes
in accounting policies and principles.
• Our business and operating results are affected by our
ability to identify and effectively manage risks
inherent in our businesses, including, where
appropriate, through the effective use of third-party
insurance and capital management techniques.
• Our ability to anticipate and respond to technological
changes can have an impact on our ability to respond
to customer needs and to meet competitive demands.
• The adequacy of our intellectual property protection,
and the extent of any costs associated with obtaining
rights in intellectual property claimed by others, can
impact our business and operating results.
• Our business and operating results can be affected by
widespread natural disasters, terrorist activities or
international hostilities, either as a result of the
impact on the economy and financial and capital
markets generally or on us or on our customers,
suppliers or other counterparties specifically.
Also, risks and uncertainties that could affect the results
anticipated in forward-looking statements or from historical
performance relating to our equity interest in BlackRock, Inc.
are discussed in more detail in BlackRock’s filings with the
SEC, including in the Risk Factors sections of BlackRock’s
reports, accessible on the SEC’s website and on or through
BlackRock’s website at www.blackrock.com.
In addition, our pending acquisition of Mercantile Bankshares
presents us with a number of risks and uncertainties related
both to the acquisition transaction itself and to the integration
of the acquired businesses into PNC after closing. These risks
and uncertainties include the following:
• Completion of the transaction remains dependent on
customary closing conditions, including regulatory
approvals. The impact of the completion of the
transaction on PNC’s financial statements will be
affected by the timing of the transaction.
• The transaction may be more expensive to complete
than anticipated, including as a result of unexpected
factors or events.
• The integration of Mercantile’s business and
operations with those of PNC, which will include
conversion of Mercantile’s different systems and
procedures, may take longer than anticipated, may be
more costly than anticipated, and may have
unanticipated adverse results relating to Mercantile’s
or PNC’s existing businesses.
• The anticipated benefits, including anticipated
strategic gains and anticipated cost savings and other
synergies of the transaction, may be significantly
harder or take longer to be realized than anticipated
or may not be achieved in their entirety, including as
a result of unexpected factors or events, and attrition
in key client, partner and other relationships relating
to the transaction may be greater than expected.
• The anticipated benefits to PNC are dependent in part
on Mercantile’s business performance in the future,
and there can be no assurance as to actual future
results, which could be impacted by various factors,
including the risks and uncertainties generally related
to PNC’s and Mercantile’s performance (with respect
to Mercantile, see Mercantile’s SEC reports,
accessible on the SEC’s website) or due to factors
related to the acquisition of Mercantile and the
process of integrating it into PNC.
66