PNC Bank 2010 Annual Report Download - page 53
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Please find page 53 of the 2010 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.(c) Included in Equity investments on our Consolidated Balance Sheet.
(d) Included in Other liabilities on our Consolidated Balance Sheet.
(e) Included in Trading securities, Investment securities, Other intangible assets, and Other assets on our Consolidated Balance Sheet.
(f) PNC’s risk of loss consisted of off-balance sheet liquidity commitments to Market Street of $5.6 billion and other credit enhancements of $.6 billion at December 31, 2009.
Market Street
Market Street is a multi-seller asset-backed commercial paper
conduit that is owned by an independent third party. Market
Street’s activities primarily involve purchasing assets or
making loans secured by interests in pools of receivables from
US corporations that desire access to the commercial paper
market. Market Street funds the purchases of assets or loans
by issuing commercial paper and is supported by pool-specific
credit enhancements, liquidity facilities and program-level
credit enhancement. Generally, Market Street mitigates its
potential interest rate risk by entering into agreements with its
borrowers that reflect interest rates based upon its weighted
average commercial paper cost of funds. During 2009 and
2010, Market Street met all of its funding needs through the
issuance of commercial paper.
Market Street commercial paper outstanding was $2.7 billion
at December 31, 2010 and $3.1 billion at December 31, 2009.
The weighted average maturity of the commercial paper was
36 days at December 31, 2010 and December 31, 2009.
During 2009, PNC Capital Markets LLC, acting as a placement
agent for Market Street, held a maximum daily position in
Market Street commercial paper of $135 million with an
average balance of $19 million. PNC Capital Markets LLC
owned no Market Street commercial paper at December 31,
2010 and December 31, 2009. PNC Bank, N.A. made no
purchases of Market Street commercial paper during 2010.
Assets of Market Street (a)
In millions Outstanding Commitments
Weighted
Average
Remaining
Maturity In
Years
December 31, 2009
Trade receivables $1,551 $4,105 2.0
Automobile financing 480 480 4.2
Auto fleet leasing 412 543 .9
Collateralized loan
obligations 126 150 .4
Residential mortgage 13 13 26.0
Other 534 567 1.7
Cash and miscellaneous
receivables 582
Total $3,698 $5,858 2.1
(a) Market Street did not recognize an asset impairment charge or experience any
material rating downgrades during 2009.
Market Street Commitments by Credit Rating (a)
December 31,
2010
December 31,
2009
AAA/Aaa 26% 14%
AA/Aa 60 50
A/A 13 34
BBB/Baa 12
Total 100% 100%
(a) All facilities are structured to meet rating agency standards for applicable rating
levels, however, the majority of our facilities are not explicitly rated by the rating
agencies.
PNC Capital Trust E Trust Preferred Securities
In February 2008, PNC Capital Trust E issued $450 million of
7.75% Trust Preferred Securities due March 15, 2068 (the
Trust E Securities). PNC Capital Trust E’s only assets are
$450 million of 7.75% Junior Subordinated Notes due
March 15, 2068 and issued by PNC (the JSNs). The Trust E
Securities are fully and unconditionally guaranteed by PNC.
We may, at our option, redeem the JSNs at 100% of their
principal amount on or after March 15, 2013.
In connection with the closing of the Trust E Securities sale,
we agreed that, if we have given notice of our election to defer
interest payments on the JSNs or a related deferral period is
continuing, then PNC would be subject during such period to
restrictions on dividends and other provisions protecting the
status of the JSN debenture holder similar to or in some ways
more restrictive than those potentially imposed under the
Exchange Agreements with Trust II and Trust III, as described
in Note 13 Capital Securities of Subsidiary Trusts and
Perpetual Trust Securities in the Notes To Consolidated
Financial Statements included in Item 8 of this Report. PNC
Capital Trusts C and D have similar protective provisions with
respect to $500 million in principal amount of junior
subordinated debentures. Also, in connection with the closing
of the Trust E Securities sale, we entered into a replacement
capital covenant, which is described in Note 13 Capital
Securities of Subsidiary Trusts and Perpetual Trust Securities
in the Notes To Consolidated Financial Statements in Item 8
of this Report.
Acquired Entity Trust Preferred Securities
As a result of the National City acquisition, we assumed
obligations with respect to $2.4 billion in principal amount of
junior subordinated debentures issued by the acquired entity.
As a result of the Mercantile, Yardville and Sterling
acquisitions, we assumed obligations with respect to $158
million in principal amount of junior subordinated debentures
issued by the acquired entities. As described in Note 13
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