PNC Bank 2007 Annual Report Download - page 98

guarantee of the obligations of such Trust under the terms of the
Capital Securities. Such guarantee is subordinate in right of
payment in the same manner as other junior subordinated debt.
There are certain restrictions on PNC’s overall ability to obtain
funds from its subsidiaries. For additional disclosure on these
funding restrictions, including an explanation of dividend and
intercompany loan limitations, see Note 22 Regulatory Matters.
PNC is subject to restrictions on dividends and other
provisions similar to or in some ways more restrictive than
those potentially imposed under the Exchange Agreement
with Trust II, as described in Note 3 Variable Interest Entities.
N OTE 13 S HAREHOLDERS ’E QUITY
Information related to preferred stock is as follows:
Preferred Shares
December 31
Shares in thousands
Liquidation
value per share 2007 2006
Authorized
$1 par value 16,985 17,012
Issued and outstanding
Series A $ 40 77
Series B 40 12
Series C 20 128 144
Series D 20 186 196
Total issued and outstanding 322 349
Series A through D are cumulative and, except for Series B,
are redeemable at our option. Annual dividends on Series A, B
and D preferred stock total $1.80 per share and on Series C
preferred stock total $1.60 per share. Holders of Series A
through D preferred stock are entitled to a number of votes
equal to the number of full shares of common stock into which
such preferred stock is convertible. Series A through D
preferred stock have the following conversion privileges:
(i) one share of Series A or Series B is convertible into eight
shares of PNC common stock; and (ii) 2.4 shares of Series C
or Series D are convertible into four shares of PNC common
stock.
We have a dividend reinvestment and stock purchase plan.
Holders of preferred stock and PNC common stock may
participate in the plan, which provides that additional shares
of common stock may be purchased at market value with
reinvested dividends and voluntary cash payments. Common
shares issued pursuant to this plan were: 571,271 shares in
2007, 535,394 shares in 2006 and 688,665 shares in 2005.
At December 31, 2007, we had reserved approximately
72.3 million common shares to be issued in connection with
certain stock plans and the conversion of certain debt and
equity securities.
Effective October 4, 2007, our Board of Directors terminated
the 2005 stock repurchase program and approved a new stock
repurchase program to purchase up to 25 million shares of
PNC common stock on the open market or in privately
negotiated transactions. The 2007 program will remain in
effect until fully utilized or until modified, superseded or
terminated. During 2007, we purchased 11 million common
shares at a total cost of approximately $800 million under the
2005 and 2007 programs. During 2006, we purchased
5 million common shares at a total cost of $354 million under
the 2005 program.
N
OTE 14 O THER C OMPREHENSIVE I NCOME
Details of other comprehensive income (loss) are as follows
(in millions):
Pretax Tax After-tax
Net unrealized securities gains (losses)
Balance at January 1, 2005 $ (66)
2005 activity
Increase in net unrealized losses for
securities held at year-end $ (312) $109 (203)
Less: net losses realized in net income
(a) (44) 15 (29)
Net unrealized securities losses (268) 94 (174)
Balance at December 31, 2005 (240)
2006 activity
Increase in net unrealized gains for
securities held at year-end 129 (46) 83
Less: net losses realized in net income
(a) (101) 35 (66)
Net unrealized securities gains 230 (81) 149
Balance at December 31, 2006 (91)
2007 activity
Increase in net unrealized losses for
securities held at year-end (134) 52 (82)
Less: net losses realized in net income
(a) (9) 3 (6)
Net unrealized securities losses (125) 49 (76)
Balance at December 31, 2007 $ (167)
(a) Pretax amounts represent net unrealized gains (losses) as of the prior year-end date
that were realized in the subsequent year when the related securities were sold.
These amounts differ from net securities losses included in the Consolidated Income
Statement primarily because they do not include gains or losses realized on
securities that were purchased and then sold during the same year.
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