PNC Bank 2008 Annual Report Download - page 7

well-capitalized in order to continue serving the credit and
deposit needs of existing and new customers. On a
consolidated basis, these proceeds resulted in further
improvement to our capital and liquidity positions.
National City, based in Cleveland, Ohio, was one of the
nation’s largest financial services companies. In connection
with obtaining regulatory approvals for the acquisition, PNC
has agreed to divest 61 of National City Bank’s branches in
Western Pennsylvania with deposits of approximately $3.9
billion as of December 31, 2008. We expect to merge National
City Bank into PNC Bank, National Association (“PNC Bank,
N.A.”) in the fourth quarter of 2009.
Additional information regarding our acquisition of National
City can be found in the following disclosures:
• The Executive Summary portion of Item 7 of this
Report,
• Note 2 Acquisitions and Divestitures included in our
Notes To Consolidated Financial Statements within
Item 8 of this Report, and
• Our Current Reports on Form 8-K filed October 24,
2008, October 30, 2008, December 23, 2008, and
January 2, 2009.
O THER A CQUISITION A ND D IVESTITURE A CTIVITY
On April 4, 2008, we acquired Lancaster, Pennsylvania-based
Sterling Financial Corporation for approximately 4.6 million
shares of PNC common stock and $224 million in cash.
Sterling was a banking and financial services company with
approximately $3.2 billion in assets, $2.7 billion in deposits,
and 65 branches in south-central Pennsylvania, northern
Maryland and northern Delaware.
On March 31, 2008, we sold J.J.B. Hilliard, W.L. Lyons, LLC,
a Louisville, Kentucky-based wholly-owned subsidiary of
PNC and a full-service brokerage and financial services
provider, to Houchens Industries, Inc. We recognized an
after-tax gain of $23 million in the first quarter of 2008 in
connection with this divestiture.
We include information on significant acquisitions and
divestitures in Note 2 Acquisitions and Divestitures in the
Notes To Consolidated Financial Statements in Item 8 of this
Report and here by reference.
R EVIEW O F L INES O F B USINESS In addition to the following
information relating to our lines of business, we incorporate
information under the captions Line of Business Highlights,
Product Revenue, and Business Segments Review in Item 7 of
this Report here by reference. Also, we include financial and
other information by business in Note 27 Segment Reporting
in the Notes To Consolidated Financial Statements in Item 8
of this Report here by reference.
We have four major businesses engaged in providing banking,
asset management and global fund processing products and
services: Retail Banking; Corporate & Institutional Banking;
BlackRock; and Global Investment Servicing. Assets, revenue
and earnings attributable to foreign activities were not
material in the periods presented. The business segment
results for 2008 and prior periods do not include the impact of
National City, which we acquired on December 31, 2008.
R ETAIL B ANKING
Retail Banking provides deposit, lending, brokerage, trust,
investment management, and cash management services to
over 6 million consumer and small business customers within
our primary geographic markets. Our customers are serviced
through 2,589 offices in our branch network as of
December 31, 2008 (including National City branches), the
call center and the internet. The branch network is located
primarily in Pennsylvania, New Jersey, Washington, DC,
Maryland, Virginia, Delaware, Ohio, Kentucky, Indiana,
Illinois, Michigan, Missouri, Florida and Wisconsin.
Retail Banking also serves as investment manager and trustee
for employee benefit plans and charitable and endowment
assets and provides nondiscretionary defined contribution plan
services. These services are provided to individuals and
corporations primarily within our primary geographic markets.
Our core strategy is to acquire and retain customers who
maintain their primary checking and transaction relationships
with PNC. We also seek revenue growth by deepening our
share of our customers’ financial assets and needs, including
savings and liquidity deposits, loans and investable assets. A
key element of our strategy is to continue to optimize our
physical distribution network by opening and upgrading stand-
alone and in-store branches in attractive sites while
consolidating or selling branches with less opportunity for
growth.
C ORPORATE &I NSTITUTIONAL B ANKING
Corporate & Institutional Banking provides lending, treasury
management, and capital markets-related products and
services to mid-sized corporations, government entities, and
selectively to large corporations. Lending products include
secured and unsecured loans, letters of credit and equipment
leases. Treasury management services include cash and
investment management, receivables management,
disbursement services, funds transfer services, information
reporting, and global trade services. Capital markets-related
products and services include foreign exchange, derivatives,
loan syndications, mergers and acquisitions advisory and
related services to middle-market companies, securities
underwriting, and securities sales and trading. Corporate &
Institutional Banking also provides commercial loan servicing,
and real estate advisory and technology solutions for the
commercial real estate finance industry. Corporate &
Institutional Banking provides products and services generally
within our primary geographic markets with certain products
and services offered nationally.
Corporate & Institutional Banking is focused on becoming a
premier provider of financial services in each of the markets it
3