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PNC Financial Services Group
2012 Annual Report

Table of contents

  • Page 1
    PNC Financial Services Group 2012 Annual Report

  • Page 2
    "PNC is going to win in this environment because we have the right people, the right culture and the right business model to deliver for our shareholders, customers, employees and communities." -Jim Rohr, chairman and chief executive officer

  • Page 3
    ...cer PNC Chairman and Chief Executive Officer Jim Rohr celebrated the 25-year anniversary of PNC trading on the New York Stock Exchange on October 22, 2012. To Our Shareholders, In nearly every way, today's banking industry is a world away from the one I joined nearly 41 years ago. New regulations...

  • Page 4
    ... corporate colors. Through effective marketing communications initiatives in 2012, awareness of the PNC brand grew to 69 percent in markets where PNC has a Retail Banking presence. Growing Customers as Never Before Our customer relationships drove PNC's progress in 2012. By increasing customers...

  • Page 5
    ... Our balance sheet liquidity remained strong as evidenced by our loan-to-deposit ratio of 87 percent as of December 31, 2012. • We exceeded our full-year cost reduction target of $550 million. $213 $183 $188 2010 2011 2012 • Our Tier 1 capital ratio increased following our cash acquisition...

  • Page 6
    ... in any year in our history. However, PNC will continue to expand its branch presence in underpenetrated markets. As we look ahead, we envision technologycentered branches that deliver products and services such as business and commercial banking, wealth management, investments and mortgages. This...

  • Page 7
    ... referral activity from Retail and Corporate & Institutional Banking. This helped to produce an increase in total net inï¬,ows, bringing discretionary assets under management to $112 billion at year-end 2012. This year, we are looking to expand those efforts. All of our client-facing employees now...

  • Page 8
    ... bottom-line returns and burnishing our already strong brand. Today, we are building a viable, highly integrated mortgage origination and servicing engine that is cost efficient and reï¬,ects PNC's business practices, culture and commitment to customer service. As refinancing activity eases...

  • Page 9
    ... to better evaluate growth of a company's business apart from the amount, on a per share basis, of intangible assets other than servicing rights included in book value per common share. PNC's book value per share was $67.05 at year-end 2012, a 41% increase over $47.68 at year-end 2009. Subtracting...

  • Page 10
    ... employee training and development programs; we were named one of the nation's 100 Best Companies by Working Mother magazine for the 11th year; and U.S. Veterans Magazine said PNC was one of the top companies in the country working to hire military veterans. After some three decades of service, Vice...

  • Page 11
    ... a total of $7 million in fees immediately following the storm. While as many as 1,000 branches along the East Coast were affected, we are pleased that our employees rallied to restore services and serve customers. These are just some of the ways that PNC and our employees support the communities...

  • Page 12
    ... director and named him to succeed me as PNC's next chief executive officer. Bill's elevation to CEO is a well deserved promotion for one of the most talented and insightful executives with whom I have ever worked. Bill also remains president of the corporation and the bank, and I will assume a new...

  • Page 13
    ... by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes The aggregate market value of the registrant's outstanding voting common stock held by nonaffiliates on June 30, 2012, determined using the per share closing price on that date on the New York Stock...

  • Page 14
    ... Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Common Stock Performance Graph Selected Financial Data. Management's Discussion and Analysis of Financial Condition and Results of Operations. Executive Summary Consolidated Income Statement Review Consolidated Balance...

  • Page 15
    ...15 Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. Controls and Procedures. Other Information. Directors, Executive Officers and Corporate Governance. Executive Compensation. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder...

  • Page 16
    ... Change in Nonperforming Assets Accruing Loans Past Due 30 To 59 Days Accruing Loans Past Due 60 To 89 Days Accruing Loans Past Due 90 Days Or More Home Equity Lines of Credit - Draw Period End Dates Bank-Owned Consumer Real Estate Related Loan Modifications Bank-Owned Consumer Real Estate Related...

  • Page 17
    ... Loans - RBC Bank (USA) Acquisition Purchased Non-Impaired Loans - Fair Value Purchased Non-Impaired Loans - Cash Flows Rollforward of Allowance for Loan and Lease Losses and Associated Loan Data Rollforward of Allowance for Unfunded Loan Commitments and Letters of Credit Investment Securities...

  • Page 18
    ... Balances Additional Fair Value Information Related to Financial Instruments Changes in Goodwill by Business Segment Summary of Changes in Goodwill and Other Intangible Assets Other Intangible Assets Amortization Expense on Existing Intangible Assets Commercial Mortgage Servicing Rights Residential...

  • Page 19
    ... Reconciliation of Statutory and Effective Tax Rates Net Operating Loss Carryforwards and Tax Credit Carryforwards Changes in Liability for Unrecognized Tax Benefits Regulatory Capital Net Outstanding Standby Letters of Credit Analysis of Commercial Mortgage Recourse Obligations Analysis of...

  • Page 20
    ... banking, asset management, and residential mortgage banking, providing many of our products and services nationally, as well as products and services in our primary geographic markets located in Pennsylvania, Ohio, New Jersey, Michigan, Illinois, Maryland, Indiana, North Carolina, Florida...

  • Page 21
    ... 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...

  • Page 22
    ... management services primarily consist of the management of equity, fixed income, multi-asset class, alternative investment and cash management products. BlackRock offers its investment products in a variety of vehicles, including open-end and closed-end mutual funds, iShares® exchange-traded funds...

  • Page 23
    ...our Retail Banking, Asset Management Group and Residential Mortgage Banking businesses and additional compliance obligations, revenue and cost impacts. We also are subject to regulation by the SEC by virtue of our status as a public company and by the SEC and the Commodity Futures Trading Commission...

  • Page 24
    (Credit CARD Act), the Secure and Fair Enforcement for Mortgage Licensing Act (the SAFE Act), and Dodd-Frank, as well as changes to the regulations implementing the Real Estate Settlement Procedures Act, the Federal Truth in Lending Act, and the Electronic Fund Transfer Act, including the new rules ...

  • Page 25
    ... rules issued by the U.S. banking agencies in June 2012 and on available data and information as of December 31, 2012. It also reflects our estimates of PNC's risk-weighted assets under Basel II (with the modifications proposed in June 2012) and application of the Basel II.5 market risk rules...

  • Page 26
    ...expects capital plans submitted in 2013 will reflect conservative dividend payout ratios and net share repurchase programs, and that requests that imply common dividend payout ratios above 30% of projected after-tax net income available to common shareholders will receive particularly close scrutiny...

  • Page 27
    ... CFPB authority to examine PNC and PNC Bank, N.A. for compliance with a broad range of federal consumer financial laws and regulations, including the laws and regulations that relate to credit card, deposit, mortgage and other consumer financial products and services we offer. In addition, DoddFrank...

  • Page 28
    ...to customer migration as a result of intense competition for consumer investment dollars. PNC Bank, N.A. competes for deposits with: • Other commercial banks, • Savings banks, • Savings and loan associations, • Credit unions, • Treasury management service companies, • Insurance companies...

  • Page 29
    ...2012. This total includes 50,947 full-time and 5,338 part-time employees, of which 23,331 full-time and 4,563 part-time employees were employed by our Retail Banking business. SEC REPORTS AND CORPORATE GOVERNANCE INFORMATION We are subject to the informational requirements of the Securities Exchange...

  • Page 30
    ... filings with the Securities and Exchange Commission. You can also find the SEC reports and corporate governance information described in the sections above in the Investor Relations section of our website. Where we have included web addresses in this Report, such as our web address and the web...

  • Page 31
    ...to identify, understand and manage the risks presented by our business activities so that we can appropriately balance revenue generation and profitability. These risks include, but are not limited to, credit risk, market risk, liquidity risk, operational risk, model risk, technology, compliance and...

  • Page 32
    ... impact the value of those holdings. Increased regulation of compensation at financial services companies as part of government efforts to reform the industry may hinder our ability to attract, retain and incentivize well-qualified individuals in key positions. Investors in mortgage loans and other...

  • Page 33
    ... liquidity risk management standards; new standards governing oversight by a covered company's board of directors and boardlevel risk committee; and new limits on the aggregate amount of credit exposure a covered company may have to any single customer or counterparty. These proposed rules also...

  • Page 34
    ... of banks, including PNC, to make loans due to balance sheet management requirements. Any of these potential impacts of the Dodd-Frank risk retention rules could affect the way in which PNC conducts its business, including its product offerings, and could also affect PNC's revenue and profitability...

  • Page 35
    ... qualify as Tier 1 capital over time to the extent they remain outstanding. The proposed rules also would require that unconsolidated investments in financial entities (potentially including PNC's investment in BlackRock), as well as mortgage servicing rights and deferred tax assets, above certain...

  • Page 36
    ... the ability of banks to meet these new requirements, including under stressed conditions, in approving actions that represent uses of capital, such as dividend increases, share repurchases and acquisitions. Our lending and servicing businesses and the value of the loans and debt securities we hold...

  • Page 37
    ... the value of servicing rights, including those we carry at fair value. • It can affect our ability to access capital markets to raise funds necessary to support our businesses and maintain our overall liquidity position. Inability to access capital markets as needed, or at cost effective rates...

  • Page 38
    ... Reserve is to regulate the national supply of bank credit and certain interest rates. The actions of the Federal Reserve influence the rates of interest that we charge on loans and that we pay on borrowings and interest-bearing deposits and can also affect the value of our on-balance sheet and off...

  • Page 39
    ... mortgage and home equity loan business and could reduce future business opportunities. One or more of the foregoing could adversely affect PNC's business, financial condition, results of operations or cash flows. We grow our business in part by acquiring other financial services companies from time...

  • Page 40
    ...as well as the relative performance of our products compared with the offerings by competitors. Asset management revenue is primarily based on a percentage of the value of the assets and thus is impacted by general changes in market valuations, customer preferences and needs. In addition, investment...

  • Page 41
    ... used to prepare the consolidated financial statements. Changes in income tax regulations, revenue rulings, revenue procedures, and other guidance can impact our tax liability and alter the timing of cash flows associated with tax deductions and payments. New guidance often dictates how changes...

  • Page 42
    ... credit, equity, fixed income, foreign exchange) could materially impact the valuation of assets as reported within our consolidated financial statements, and the period-to-period changes in value could vary significantly. There are risks resulting from the extensive use of models in our business...

  • Page 43
    ...Our executive and primary administrative offices are currently located at One PNC Plaza, Pittsburgh, Pennsylvania. The 30story structure is owned by PNC Bank, N.A. We own or lease numerous other premises for use in conducting business activities, including operations centers, offices, and branch and...

  • Page 44
    ... Executive Vice President since April 2012 and head of PNC's Retail Banking since February 2012. Prior to being named to his current position, Mr. Hall led the delivery of sales and service to PNC's retail and small business customers, directed branch banking, business banking, community development...

  • Page 45
    ... LLP (law firm) (2007) • Charles E. Bunch, 63, Chairman and Chief Executive Officer of PPG Industries, Inc. (coatings, sealants and glass products) (2007) • Paul W. Chellgren, 70, Operating Partner, Snow Phipps Group, LLC (private equity) (1995) • William S. Demchak, 50, President of PNC (2013...

  • Page 46
    ... the New York Stock Exchange and is traded under the symbol "PNC." At the close of business on February 15, 2013, there were 75,100 common shareholders of record. Holders of PNC common stock are entitled to receive dividends when declared by the Board of Directors out of funds legally available for...

  • Page 47
    ...Cumulative Five Year Total Return 200 Assumes $100 investment at Close of 5-Year Market on December 31, 2007 Compound Base Total Return = Price change plus reinvestment Growth Period of dividends Rate Dec. 07 Dec. 08 Dec. 09 Dec. 10 Dec. 11 Dec. 12 PNC S&P 500 Index S&P 500 Banks Peer Group 100 100...

  • Page 48
    ...in connection with BlackRock's acquisition of Barclays Global Investors (BGI) on December 1, 2009. (d) Amount for 2008 includes the $504 million conforming provision for credit losses related to our National City acquisition. (e) Includes results of operations for PNC Global Investment Servicing Inc...

  • Page 49
    ... common shareholders' equity Average assets Loans to deposits Dividend payout Tier 1 common Tier 1 risk-based Common shareholders' equity to total assets Average common shareholders' equity to average assets SELECTED STATISTICS Employees Retail Banking branches ATMs Residential mortgage servicing...

  • Page 50
    ... Income Statement includes the impact of business activity associated with the RBC Bank (USA) acquisition subsequent to March 2, 2012. RBC Bank (USA), based in Raleigh, North Carolina, operated more than 400 branches in North Carolina, Florida, Alabama, Georgia, Virginia and South Carolina. The...

  • Page 51
    ... business intelligence services to asset managers, brokerdealers and financial advisors worldwide, for $2.3 billion in cash. The pretax gain in discontinued operations recorded in the third quarter of 2010 related to this sale was $639 million, net of transaction costs, or $328 million after taxes...

  • Page 52
    ...of the Preferred Stock from the Trust immediately upon its issuance. See Note 19 Equity in the Notes To Consolidated Financial Statements in Item 8 of this Report for further detail. A summary of 2013 capital and liquidity actions to date follows. On January 28, 2013, PNC Bank, N.A. issued: • $750...

  • Page 53
    ...types of positions that are subject to the market risk capital framework, establish a new stressed Value at Risk ("VaR") charge for covered trading positions, provide for certain market risk-related public disclosures and replace references to credit ratings in the market risk rules with alternative...

  • Page 54
    ... mortgage loans sales revenue related to an increase in loan origination volume, gains on sales of Visa Class B common shares and higher corporate service fees, largely offset by higher provision for residential mortgage repurchase obligations. • The provision for credit losses decreased...

  • Page 55
    ....5 rules. PNC's goal is to be within a Basel III Tier 1 common capital ratio range of between 8.0 to 8.5 percent by year end 2013 without benefit of phase-ins. We believe we are positioned to reach this goal. In April 2012 the PNC board of directors raised the quarterly cash dividend on common stock...

  • Page 56
    ... the RBC Bank (USA) acquisition contributed to the increase. In addition, average commercial loans increased from organic loan growth primarily in corporate banking, real estate and asset-based lending and average consumer loans increased due to growth in indirect auto loans. Loans represented 71...

  • Page 57
    ... deposit balances increased net interest income by 6%. The revenue increase was offset by higher noninterest expense from strategic business investments and higher provision for credit losses. RESIDENTIAL MORTGAGE BANKING Residential Mortgage Banking reported a loss of $308 million in 2012 compared...

  • Page 58
    ...are treasury management revenue, corporate finance fees, including revenue from capital markets-related products and services, and commercial mortgage servicing revenue, including commercial mortgage banking activities. See the Product Revenue portion of this Consolidated Income Statement Review for...

  • Page 59
    ...losses related to our equity investment in BlackRock are included in the Business Segments Review section of this Item 7. For 2013, we currently expect both noninterest income and total revenue to increase compared with 2012. PRODUCT REVENUE In addition to credit and deposit products for commercial...

  • Page 60
    ...of integration costs. The increase in noninterest expense in 2012 compared with 2011 also reflected operating expense for the RBC Bank (USA) acquisition, higher personnel expense, higher settlements for other litigation and increased expenses for other real estate owned. In the first quarter of 2013...

  • Page 61
    ... equity loans and $.3 billion of credit card loans), $2.1 billion of residential real estate, and $.1 billion of equipment lease financing loans. Excluding acquisition activity, the increase in commercial loans was due to growth primarily in asset-based lending, real estate, healthcare, and public...

  • Page 62
    ... estate related (a) Financial services Health care Other industries Total commercial Commercial real estate Real estate projects (b) Commercial mortgage Total commercial real estate Equipment lease financing Total Commercial Lending (c) Consumer Lending Home equity Lines of credit Installment Total...

  • Page 63
    ... mark Recorded investment Allowance for loan losses Net investment Total purchased impaired loans: Unpaid principal balance Purchased impaired mark Recorded investment Allowance for loan losses Net investment (a) Represents National City and RBC Bank (USA) acquisitions. (b) Represents National City...

  • Page 64
    .... Commercial/commercial real estate (a) Home equity lines of credit Credit card Other Total $ 78,703 19,814 17,381 4,694 $120,592 $ 64,955 18,317 16,216 3,783 $103,271 (a) Less than 5% of these amounts at each date relate to commercial real estate. The PNC Financial Services Group, Inc. - Form...

  • Page 65
    ... effective capital rules. In addition, the amount representing the credit-related portion of OTTI on available for sale securities would reduce our earnings and regulatory capital ratios. The expected weighted-average life of investment securities (excluding corporate stocks and other) was 4.0 years...

  • Page 66
    ...AssetBacked Securities (a) Fair Value - Available for Sale Fair Value - Held to Maturity Total Fair Value % of Fair Value: By Vintage 2012 2011 2010 2009 2008 2007 2006 2005 and earlier Not Available Total By Credit Rating (at December 31, 2012) Agency AAA AA A BBB BB B Lower than B No rating Total...

  • Page 67
    ... 31, 2012 Commercial MortgageBacked Securities Asset-Backed Securities (a) Net Unrealized Gain (Loss) In millions Available for Sale Securities (Non-Agency) Fair Value Fair Value Net Unrealized Gain Fair Value Credit Rating Analysis AAA Other Investment Grade (AA, A, BBB) Total Investment Grade...

  • Page 68
    ... the related securities had a fair value of $3.7 billion. The fair value of sub-investment grade investment securities for which we have not recorded an OTTI credit loss as of December 31, 2012 totaled $1.9 billion, with unrealized net gains of $114 million. COMMERCIAL MORTGAGE-BACKED SECURITIES The...

  • Page 69
    ... Money market Demand Retail certificates of deposit Savings Time deposits in foreign offices and other time Total deposits Borrowed funds Federal funds purchased and repurchase agreements Federal Home Loan Bank borrowings Bank notes and senior debt Subordinated debt Commercial paper Other Total...

  • Page 70
    ...gains)/ losses, after-tax Net unrealized gains on cash flow hedge derivatives, after-tax Other Tier 1 risk-based capital Subordinated debt Eligible allowance for credit losses Total risk-based capital Tier 1 common capital Tier 1 risk-based capital Preferred equity Trust preferred capital securities...

  • Page 71
    ...the RBC Bank (USA) acquisition, which resulted in higher goodwill and risk-weighted assets, partially offset by retention of earnings which more than offset organic asset growth. Our Tier 1 risk-based capital ratio reflected our 2012 capital actions of issuing approximately $2.0 billion of preferred...

  • Page 72
    ...Executive Summary section of this Item 7 for additional information regarding our redemptions of trust preferred securities and hybrid capital securities during 2012 and announced redemption of the REIT Preferred Securities issued by PNC Preferred Funding Trust III. The PNC Financial Services Group...

  • Page 73
    ... of assets recorded at fair value are included in the securities available for sale portfolio. The majority of Level 3 assets represent Non-agency residential mortgage-backed and asset-backed securities in the securities available for sale portfolio for which there was limited market activity. An...

  • Page 74
    ...loss. Formerly, PNC had underwritten foreign infrastructure leases supported by highly rated bank letters of credit and other collateral, US Treasury securities and the underlying assets of the lease. Country exposures are monitored and reported on a regular basis. We actively monitor sovereign risk...

  • Page 75
    ... Kingdom local office commitments to PNC Business Credit corporate customers on a secured basis. We also track European financial exposures where our clients, primarily U.S. entities, appoint PNC as a letter of credit issuing bank and we elect to assume the joint probability of default risk. As of...

  • Page 76
    ...a separate reportable business, such as gains or losses related to BlackRock transactions, integration costs, asset and liability management activities including net securities gains or losses, other-than-temporary impairment of investment securities and certain trading activities, exited businesses...

  • Page 77
    ...) Year ended December 31 - in millions Net Income (Loss) 2012 2011 Revenue 2012 2011 Average Assets (a) 2012 2011 Retail Banking Corporate & Institutional Banking Asset Management Group Residential Mortgage Banking BlackRock Non-Strategic Assets Portfolio Total business segments Other (b) Total...

  • Page 78
    ... Total revenue Provision for credit losses Noninterest expense Pretax earnings Income taxes Earnings AVERAGE BALANCE SHEET Loans Consumer Home equity Indirect auto Indirect other Education Credit cards Other Total consumer Commercial and commercial real estate Floor plan Residential mortgage Total...

  • Page 79
    ..., investment products and money management services. Net checking relationships grew 714,000 in 2012, including 460,000 from the RBC Bank (USA) acquisition. Organic net checking relationships grew by 4% in 2012 from year end 2011. The growth reflects strong results and gains in all of our markets as...

  • Page 80
    ..., or 23%, in 2012, primarily resulting from dealer line utilization and additional dealer relationships. Average credit card balances increased $325 million, or 9%, over 2011 as a result of the portfolio purchase from RBC Bank (Georgia), National Association in March 2012 and organic customer growth...

  • Page 81
    ... income Corporate service fees Other Noninterest income Total revenue Provision for credit losses (benefit) Noninterest expense Pretax earnings Income taxes Earnings AVERAGE BALANCE SHEET Loans Commercial Commercial real estate Commercial - real estate related Asset-based lending Equipment lease...

  • Page 82
    ...USA) acquisition and growth in our Corporate Banking (Corporate Finance, Financial Services Advisory and Banking, Public Finance and Healthcare businesses), Real Estate and Business Credit (asset-based lending) businesses. • Period-end loan balances have increased for the ninth consecutive quarter...

  • Page 83
    ... run-off. See the additional revenue discussion regarding treasury management, capital markets-related products and services, and commercial mortgage banking activities in the Product Revenue section of the Consolidated Income Statement Review. 64 The PNC Financial Services Group, Inc. - Form 10-K

  • Page 84
    ... 60 $127 $ - INCOME STATEMENT Net interest income Noninterest income Total revenue Provision for credit losses (benefit) Noninterest expense Pretax earnings Income taxes Earnings AVERAGE BALANCE SHEET Loans Consumer Commercial and commercial real estate Residential mortgage Total loans Goodwill and...

  • Page 85
    ...internal referral sales and adding new front line sales staff throughout our footprint. For 2012, the business delivered strong sales production, grew high value clients and benefited from significant referrals from other PNC lines of business. Over time, the successful execution of these strategies...

  • Page 86
    ... revenue Provision for credit losses (benefit) Noninterest expense (a) Pretax earnings (loss) Income taxes (benefit) Earnings (loss) AVERAGE BALANCE SHEET Portfolio loans Loans held for sale Mortgage servicing rights (MSR) Other assets Total assets Deposits Borrowings and other liabilities Capital...

  • Page 87
    ... rights, partially offset by increased loan sales revenue driven by higher loan origination volume. The strategic focus of the business is the acquisition of new customers through a retail loan officer sales force with an emphasis on home purchase transactions. Two key aspects of this strategy...

  • Page 88
    ... STATEMENT Net interest income Noninterest income Total revenue Provision for credit losses Noninterest expense Pretax earnings Income taxes Earnings AVERAGE BALANCE SHEET Commercial Lending: Commercial/Commercial real estate Lease financing Total commercial lending Consumer Lending: Home equity...

  • Page 89
    ... for credit losses, partially offset by lower net interest income driven by declines in loan balances and purchase accounting accretion. 2012 included the impact of the RBC Bank (USA) acquisition, which added approximately $1.0 billion of residential real estate loans, $.2 billion of commercial...

  • Page 90
    ... based on historical loss experience adjusted for recent activity. Approximately $2.2 billion, or 56%, of the ALLL at December 31, 2012 have been allocated to these consumer lending categories. During the third quarter of 2012, PNC increased the amount of internally observed data used in estimating...

  • Page 91
    ... and Letters of Credit in the Notes To Consolidated Financial Statements and Allocation Of Allowance For Loan And Lease Losses in the Statistical Information (Unaudited) section of Item 8 of this Report. Estimated Cash Flows On Purchased Impaired Loans ASC 310-30 Loans and Debt Securities Acquired...

  • Page 92
    ... of October 1, 2012 (annual impairment testing date), there was no unallocated excess capital (difference between shareholders' equity minus total economic capital assigned and increased by the incremental targeted equity capital infusion). Except for the Residential Mortgage Banking reporting unit...

  • Page 93
    ... trading activities, including foreign exchange. We also earn fees and commissions from issuing loan commitments, standby letters of credit and financial guarantees, selling various insurance products, providing treasury management services, providing merger and acquisition advisory and related...

  • Page 94
    ... in Note 10 Goodwill and Other Intangible Assets in the Notes To Consolidated Financial Statements in Item 8 of this Report. These sensitivities do not include the impact of the related hedging activities. Changes in fair value generally cannot be extrapolated because the relationship of the...

  • Page 95
    ... that we use include a policy of reflecting trust assets at their fair market value. On an annual basis, we review the actuarial assumptions related to the pension plan. The primary assumptions used to measure pension obligations and costs are the discount rate, compensation increase and expected...

  • Page 96
    ... at each annual measurement date. Taking into consideration all of these factors, the expected long-term return on plan assets for determining net periodic pension cost for 2012 was 7.75%, the same as it was for 2011. After considering the views of both internal and external capital market advisors...

  • Page 97
    ... OBLIGATIONS As discussed in Note 3 Loan Sale and Servicing Activities and Variable Interest Entities in the Notes To Consolidated Financial Statements in Item 8 of this Report, PNC has sold commercial mortgage, residential mortgage and home equity loans directly or indirectly through securitization...

  • Page 98
    ... their capital availability or whether they remain in business) or factors that limit our ability to pursue recourse from these parties (e.g., contractual loss caps, statutes of limitations). Origination and sale of residential mortgages is an ongoing business activity, and, accordingly, management...

  • Page 99
    .... (c) Represents fair value of loans repurchased only as we have no exposure to changes in the fair value of loans or underlying collateral when indemnification/settlement payments are made to investors. (d) Repurchase activity associated with insured loans, government-guaranteed loans, and loans...

  • Page 100
    ... respect to certain brokered home equity loans/lines that were sold to a limited number of private investors in the financial services industry by National City prior to our acquisition of National City. PNC is no longer engaged in the brokered home equity lending business, and our exposure under...

  • Page 101
    ... payments. (c) Represents fair value of loans repurchased only as we have no exposure to changes in the fair value of loans or underlying collateral when indemnification/settlement payments are made to investors. (d) Activity relates to brokered home equity loans/lines sold through loan sale...

  • Page 102
    ... the Board of Directors, facilitates timely identification and resolution of issues. PNC's multi-level risk committee structure provides a formal channel to identify, decision, and report risk. Risk committees membership includes representatives from business and risk groups that are responsible for...

  • Page 103
    ... and report to a working committee or corporate committee. These working groups generally have a narrower scope and may be limited in their duration. Policies and Procedures - PNC uses various risk management policies and procedures to provide direction and guidance to management and the Board of...

  • Page 104
    ...or 18%, from year-end 2011. The reduction was mainly due to a decline in government insured residential real estate loans in addition to a first quarter of 2012 policy change for home equity loans whereby loans are placed on nonaccrual status when past due 90 days compared to prior policy of placing...

  • Page 105
    ... Real Estate Rental and Leasing Industry. Our average nonperforming loans associated with commercial lending were under $1 million. Eight of our ten largest outstanding nonperforming assets are from the commercial lending portfolio and represent 11% and 4% of total commercial lending nonperforming...

  • Page 106
    ... estate Equipment lease financing Total commercial lending Consumer lending (b) Home equity (c) Residential real estate Residential mortgage (d) Residential construction Credit card Other consumer Total consumer lending (e) Total nonperforming loans (f) OREO and foreclosed assets Other real estate...

  • Page 107
    ... 31, 2011, to $540 million at December 31, 2012, which represents 14% of total nonperforming assets. The decrease is primarily due to increased sales activity and greater valuation losses offset in part by an increase from the acquisition of RBC Bank (USA). Of the $245 million added to OREO through...

  • Page 108
    ...Statements in Item 8 of this Report. Dollars in millions Dec. 31 2012 Amount Dec. 31 2011 Percent of Total Outstandings Dec. 31 Dec. 31 2012 2011 Commercial Commercial real estate Equipment lease financing Home equity Residential real estate Non government insured Government insured Credit card...

  • Page 109
    ... Due 90 Days Or More (a) Amount Dec. 31 2011 Percentage of Total Outstandings Dec. 31 Dec. 31 2012 2011 Dollars in millions Dec. 31 2012 Commercial Commercial real estate Equipment lease financing Home equity (b) Residential real estate Non government insured Government insured Credit card Other...

  • Page 110
    ... represented in our pools used for roll-rate calculations. Generally, our variable-rate home equity lines of credit have either a seven or ten year draw period, followed by a 20 year amortization term. During the draw period, we have home equity lines of credit where borrowers pay interest...

  • Page 111
    ... Balance Dollars in millions Home equity Temporary Modifications Permanent Modifications Total home equity Residential Mortgages Permanent Modifications Non-Prime Mortgages Permanent Modifications Residential Construction Permanent Modifications Total Bank-Owned Consumer Real Estate Related Loan...

  • Page 112
    ...no change to the loan's contractual terms so the borrower remains legally responsible for payment of the loan under its original terms. A payment plan involves the borrower paying the past due amounts over a short period of time, generally three months, in addition to the contractual payment amounts...

  • Page 113
    ... as in Note 5 Asset Quality in the Notes To Consolidated Financial Statements in Item 8 of this Report. Beginning in 2010, we established certain commercial loan modification and payment programs for small business loans, Small Business Administration loans, and investment real estate loans. As of...

  • Page 114
    ... lending net charge-offs increased slightly from $927 million in 2011 to $930 million in 2012. Charge-offs Recoveries Net Charge-offs Percent of Average Loans 2012 Commercial Commercial real estate Equipment lease financing Home equity Residential real estate Credit card Other consumer Total...

  • Page 115
    ... in the RBC Bank (USA) acquisition were recorded at fair value. No allowance for loan losses was carried over and no allowance was created at acquisition. See Note 6 Purchased Loans in the Notes To Consolidated Financial Statements in Item 8 of this Report for additional information. In addition...

  • Page 116
    ... to manage risk concentrations in the credit portfolio. That risk management could come from protection purchased or sold in the form of single name or index products. When we buy loss protection by purchasing a CDS, we pay a fee to the seller, or CDS counterparty, in return for the right to receive...

  • Page 117
    ...Unit management is responsible for the day-to-day management of operational risks inherent in the products, services, and activities for which they are responsible. Business Unit management is also responsible for adhering to PNC's enterprise-wide operational risk management policies and procedures...

  • Page 118
    ... benefit received from insurance mitigation. Oversight of insurance purchased is provided by Risk committees within the governance structure. On a quarterly basis, an enterprise operational risk report is developed to report key operational risks to senior management and the Board of Directors...

  • Page 119
    ... limits for parent company liquidity are established within our Enterprise Capital and Liquidity Management Policy. The Board of Directors' Risk Committee regularly reviews compliance with the established limits. Bank Level Liquidity - Uses Obligations requiring the use of liquidity can generally...

  • Page 120
    ...acquire both RBC Bank (USA) and a credit card portfolio from RBC Bank (Georgia), National Association. Additionally, in June 2012, we used $1.4 billion of parent company cash to purchase senior extendible floating rate bank notes issued by PNC Bank, N.A noted above. See Supervision and Regulation in...

  • Page 121
    ... Bank-level capital needs, • Laws and regulations, • Corporate policies, • Contractual restrictions, and • Other factors. The amount available for dividend payments by PNC Bank, N.A. to the parent company without prior regulatory approval was approximately $1.5 billion at December 31, 2012...

  • Page 122
    ... to purchase one share of PNC common stock at an exercise price of $67.33, sold by the US Treasury in a secondary public offering in May 2010. These common stock warrants will expire December 31, 2018. Status of Credit Ratings The cost and availability of short-term and long-term funding, as well as...

  • Page 123
    ... related to tax credit investments of $685 million and other direct equity investments of $48 million that are included in Other liabilities on our Consolidated Balance Sheet. MARKET RISK MANAGEMENT Market risk is the risk of a loss in earnings or economic value due to adverse movements in market...

  • Page 124
    ... funding base and balance sheet flexibility to adjust, where appropriate and permissible, to changing interest rates and market conditions. Market Risk Management - Trading Risk Our trading activities are primarily customer-driven trading in fixed income securities, derivatives and foreign exchange...

  • Page 125
    ... exchange and fixed income client sales, higher underwriting activity, improved client-related trading results and the reduced impact of counterparty credit risk on valuations of derivative positions. 106 The PNC Financial Services Group, Inc. - Form 10-K BlackRock Tax credit investments Private...

  • Page 126
    ... asset and liability risk management process to help manage exposure to interest rate, market and credit risk inherent in our business activities. Substantially all such instruments are used to manage risk related to changes in interest rates. Interest rate and total return swaps, interest rate...

  • Page 127
    ... Total derivatives used for commercial mortgage banking activities Total derivatives used for customer-related activities Total derivatives used for other risk management activities Total derivatives not designated as hedging instruments Total Derivatives (a) Represents the net fair value of assets...

  • Page 128
    ... real estate was impacted by portfolio management activities, paydowns and net charge-offs. Commercial loans increased due to a combination of new client acquisition and improved utilization. Loans represented 68% of average interest-earning assets for 2011 and for 2010. The total loan balance...

  • Page 129
    ...value and amortized cost. The comparable amount at December 31, 2010 was a net unrealized loss of $861 million. The expected weightedaverage life of investment securities (excluding corporate stocks and other) was 3.7 years at December 31, 2011 and 4.7 years at December 31, 2010. Loans Held For Sale...

  • Page 130
    ... loan-to-value ratio (CLTV) - This is the aggregate principal balance(s) of the mortgages on a property divided by its appraised value or purchase price. Commercial mortgage banking activities - Includes commercial mortgage servicing, originating commercial mortgages for sale and related hedging...

  • Page 131
    ...management accounting methodology designed to recognize the net interest income effects of sources and uses of funds provided by the assets and liabilities of a business segment. We assign these balances LIBOR-based funding rates at origination that represent the interest cost for us to raise/invest...

  • Page 132
    ... commercial, commercial real estate, equipment lease financing, home equity, residential real estate, credit card and other consumer customers as well as TDRs which have not returned to performing status. Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale...

  • Page 133
    ... gains/(losses), net - We have elected to measure acquired or originated residential mortgage servicing rights (MSRs) at fair value under GAAP. We employ a risk management strategy designed to protect the economic value of MSRs from changes in interest rates. This strategy utilizes securities and...

  • Page 134
    ...trust preferred securities, other noncontrolling interest not qualified as Tier 1, eligible gains on available for sale equity securities and the allowance for loan and lease losses, subject to certain limitations. Total risk-based capital ratio - Total risk-based capital divided by period-end risk...

  • Page 135
    ...of unemployment, loan utilization rates, delinquencies, defaults and counterparty ability to meet credit and other obligations. The PNC Financial Services Group, Inc. - Form 10-K - • • • Changes in customer preferences and behavior, whether due to changing business and economic conditions...

  • Page 136
    ... in more detail by BlackRock in its SEC filings. Our 2012 acquisition of RBC Bank (USA) presents us with risks and uncertainties related to the integration of the acquired businesses into PNC, including: - Anticipated benefits of the transaction, including cost savings and strategic gains, may...

  • Page 137
    ... REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of The PNC Financial Services Group, Inc. In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of income and comprehensive income, of changes in equity...

  • Page 138
    ... share data Year ended December 31 2012 2011 2010 Interest Income Loans Investment securities Other Total interest income Interest Expense Deposits Borrowed funds Total interest expense Net interest income Noninterest Income Asset management Consumer services Corporate services Residential mortgage...

  • Page 139
    ... SERVICES GROUP, INC. In millions Year ended December 31 2012 2011 2010 Net income Other comprehensive income, before tax and net of reclassifications into Net income: Net unrealized gains on non-OTTI securities Net unrealized gains (losses) on OTTI securities Net unrealized gains (losses) on cash...

  • Page 140
    ... Common stock ($5 par value, authorized 800 shares, issued 538 and 537 shares) Capital surplus - preferred stock Capital surplus - common stock and other Retained earnings Accumulated other comprehensive income (loss) Common stock held in treasury at cost: 10 and 10 shares Total shareholders' equity...

  • Page 141
    ... were used together with other available funds to redeem the Series N (TARP) Preferred Stock, for a $3.4 billion net increase in total equity. (c) Net treasury stock activity totaled less than .5 million shares issued or redeemed. (d) 10,000 Series O preferred shares with a $1 par value were issued...

  • Page 142
    ... shares Mortgage servicing rights valuation adjustment Gain on sale of PNC Global Investment Servicing Gains on BlackRock transactions Noncash charges on trust preferred securities redemptions Undistributed earnings of BlackRock Net change in Trading securities and other short-term investments Loans...

  • Page 143
    ... Year ended December 31 2012 2011 2010 Financing Activities Net change in Noninterest-bearing deposits Interest-bearing deposits Federal funds purchased and repurchase agreements Federal Home Loan borrowings Commercial paper Other borrowed funds Sales/issuances Federal Home Loan borrowings Bank...

  • Page 144
    ... banking, asset management, and residential mortgage banking, providing many of its products and services nationally, as well as, products and services in PNC's primary geographic markets located in Pennsylvania, Ohio, New Jersey, Michigan, Illinois, Maryland, Indiana, North Carolina, Florida...

  • Page 145
    ...Issuing loan commitments, standby letters of credit and financial guarantees, • Selling various insurance products, • Providing treasury management services, • Providing merger and acquisition advisory and related services, and • Participating in certain capital markets transactions. Revenue...

  • Page 146
    ...our investment in BlackRock Series C preferred stock. We also recognize gain/(loss) on changes in the fair value of residential mortgage servicing rights (MSRs), which are measured at fair value. We recognize revenue from servicing residential mortgages, commercial mortgages and other consumer loans...

  • Page 147
    ... the investments. Fair value of publicly traded direct investments are determined using quoted market prices and are subject to various discount factors for legal or contractual sales restrictions, when appropriate. The valuation procedures applied to direct investments in private companies include...

  • Page 148
    ... value of future expected cash flows using assumptions as to discount rates, interest rates, prepayment speeds, credit losses and servicing costs, if applicable. With the exception of loan sales to certain US government chartered entities, our loan sales and securitizations are generally structured...

  • Page 149
    ... transferred to held for investment based on a change in strategy. We transfer these loans at the lower of cost or estimated fair value; however, any loans held for sale and designated at fair value will remain at fair value for the life of the loan. 130 The PNC Financial Services Group, Inc. - Form...

  • Page 150
    Effective in the second quarter of 2011, the commercial nonaccrual policy was applied to certain small business credit card balances. This change resulted in loans being placed on nonaccrual status when they become 90 days or more past due. We continue to charge-off these loans at 180 days past due....

  • Page 151
    ... exposure, cross-border risk, lending to specialized industries or borrower type, guarantor requirements, and regulatory compliance. See Note 5 Asset Quality and Note 7 Allowances for Loan and Lease Losses and Unfunded Loan Commitments and Letters of Credit for additional information. ALLOWANCE FOR...

  • Page 152
    ... fair value and how we manage the risks inherent in the commercial mortgage servicing rights assets. Specific risk characteristics of commercial mortgages include loan type, currency or exchange rate, interest rates, expected cash flows and changes in the cost of servicing. We record these servicing...

  • Page 153
    ... on the Consolidated Balance Sheet and the related cash flows in the Operating Activities section of the Consolidated Statement Of Cash Flows. Adjustments for counterparty credit risk are included in the determination of fair value. The accounting for changes in the fair value of a derivative...

  • Page 154
    ...commitments to purchase or sell commercial and residential real estate loans. These commitments are accounted for as free-standing derivatives which are recorded at fair value in Other assets or Other liabilities on the Consolidated Balance Sheet. Any gain or loss from the change in fair value after...

  • Page 155
    ...statements, and (v) any transfers between Level 1 and 2 and the reason for those transfers. The adoption of this new guidance did not have a material effect on our results of operations or financial position. We adopted ASU 2011-04 on January 1, 2012. See Note 9 Fair Value for additional information...

  • Page 156
    ... recorded reflects the increased market share and related synergies that are expected to result from the acquisition, and represents the excess purchase price over the estimated fair value of the net assets acquired by PNC. The goodwill was assigned primarily to PNC's Retail Banking and Corporate...

  • Page 157
    ... credit losses resulting from recording loan assets at fair value. Additionally, the pro forma financial information does not include the impact of possible business model changes and does not reflect pro forma adjustments to conform accounting policies between RBC Bank (USA) and PNC. Additionally...

  • Page 158
    ... Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC), and Government National Mortgage Association (GNMA) (collectively, the Agencies). FNMA and FHLMC generally securitize our transferred loans into mortgage-backed securities for sale into the secondary market through special...

  • Page 159
    ... provides information related to the cash flows associated with PNC's loan sale and servicing activities: In millions Residential Mortgages Commercial Mortgages (a) Home Equity Loans/Lines (b) CASH FLOWS - Year ended December 31, 2012 Sales of loans (h) Repurchases of previously transferred loans...

  • Page 160
    ...Street Credit Card Securitization Trust (c) Tax Credit Investments Total Assets Cash and due from banks Interest-earning deposits with banks Investment securities Loans Allowance for loan and lease losses Equity investments Other assets Total assets Liabilities Commercial paper Other borrowed funds...

  • Page 161
    ... commercial paper. PNC Bank, National Association, (PNC Bank, N.A.) provides certain administrative services, the program-level credit enhancement and liquidity facilities to Market Street in exchange for fees negotiated based on market rates. The program-level credit enhancement covers net losses...

  • Page 162
    ... these funds, generate servicing fees by managing the funds, and earn tax credits to reduce our tax liability. General partner or managing member activities include selecting, evaluating, structuring, negotiating, and closing the fund investments in operating limited partnerships or LLCs, as well as...

  • Page 163
    ... the carrying value of the mortgage-backed securities, servicing assets, servicing advances, and our liabilities associated with our recourse obligations. Creditors of the securitization SPEs have no recourse to PNC's assets or general credit. 144 The PNC Financial Services Group, Inc. - Form 10-K

  • Page 164
    ... 2012 December 31 2011 Commercial and commercial real estate Home equity lines of credit Credit card Other Total (a) $ 78,703 19,814 17,381 4,694 $120,592 $ 64,955 18,317 16,216 3,783 $103,271 Commercial lending Commercial Commercial real estate Equipment lease financing Total Commercial Lending...

  • Page 165
    ... Due 90 Days Or More Past Due Total Past Due (b) Nonperforming Loans Purchased Impaired Total Loans December 31, 2012 Commercial Commercial real estate Equipment lease financing Home equity (c) Residential real estate (d) Credit card Other consumer (e) Total Percentage of total loans December 31...

  • Page 166
    ... Commercial lending Commercial Commercial real estate Equipment lease financing Total commercial lending Consumer lending (a) Home equity (b) Residential real estate (c) Credit card Other consumer Total consumer lending (d) Total nonperforming loans (e) OREO and foreclosed assets Other real estate...

  • Page 167
    ... and updated on a risk-adjusted basis, generally at least once per year. Additionally, on an annual basis, we update PD rates related to each rating grade based upon internal historical data, augmented by market data. For small balance homogenous pools of commercial loans, mortgages and leases, we...

  • Page 168
    ... credit management reports, which are utilized to monitor the risk in the loan classes. LTV (inclusive of combined loan-to-value (CLTV) ratios for second lien positions): At least semi-annually, we update the property values of real estate collateral and calculate an updated LTV ratio. For open-end...

  • Page 169
    ... - purchased impaired loans (a) Government insured or guaranteed residential real estate mortgages (a) Purchase accounting, deferred fees and other accounting adjustments Total home equity and residential real estate loans (b) (a) Represents outstanding balance. (b) Represents recorded investment...

  • Page 170
    ... property values. These ratios are updated semi-annually. The related estimates and inputs are based upon an approach that uses a combination of third-party automated valuation models (AVMs), HPI indices, property location, internal and external balance information, origination data and management...

  • Page 171
    Table 69: Consumer Real Estate Secured Asset Quality Indicators - Purchased Impaired Loans (a) Home Equity (b) (c) December 31, 2012 - in millions 1st Liens 2nd Liens Residential Real Estate (b) (c) Total Current estimated LTV ratios (d) (e) Greater than or equal to 125% and updated FICO scores: ...

  • Page 172
    ... using modeled property values. These ratios are updated semi-annually. The related estimates and inputs are based upon an approach that uses a combination of third-party AVMs, HPI indices, property location, internal and external balance information, origination data and management assumptions...

  • Page 173
    ... score available or required refers to new accounts issued to borrowers with limited credit history, accounts for which we cannot obtain an updated FICO (e.g., recent profile changes), cards issued with a business name, and/or cards secured by collateral. Management proactively assesses the risk and...

  • Page 174
    ...commercial lending Total TDRs Nonperforming Accruing (b) Credit card (c) Total TDRs $2,318 541 $2,859 $1,589 1,037 233 $2,859 $1,798 405 $2,203 $1,141 771 291 $2,203 (a) Pursuant to regulatory guidance issued in the third quarter of 2012, additional troubled debt restructurings related to changes...

  • Page 175
    ...Loans Pre-TDR Recorded Investment (b) Principal Forgiveness Rate Reduction Other Total Commercial lending Commercial Commercial real estate Equipment lease financing Total commercial lending Consumer lending Home equity Residential real estate Credit card Other consumer Total consumer lending Total...

  • Page 176
    ... reporting periods. Number of Contracts Recorded Investment Commercial lending Commercial Commercial real estate Equipment lease financing Total commercial lending Consumer lending Home equity Residential real estate Credit card Other consumer Total consumer lending Total TDRs During the year...

  • Page 177
    ... Principal Balance Recorded Investment (a) Associated Allowance (b) Average Recorded Investment (a) December 31, 2012 Impaired loans with an associated allowance Commercial Commercial real estate Home equity (c) Residential real estate (c) Credit card (c) Other consumer (c) Total impaired loans...

  • Page 178
    ...(b) Recorded Outstanding Investment Balance In millions Commercial Lending Commercial Commercial real estate Total Commercial Lending Consumer Lending Consumer Residential real estate Total Consumer Lending Total (a) Represents National City and RBC Bank (USA) acquisitions. (b) Represents National...

  • Page 179
    ...) Net reclassifications to accretable from non-accretable (b) Disposals December 31 $2,109 587 (828) 327 (29) $2,166 Commercial Lending Commercial Commercial real estate Equipment lease financing Total Commercial Lending Consumer Lending Home equity Residential real estate Credit card and...

  • Page 180
    ... purchased loans acquired in connection with the RBC Bank (USA) transaction. Table 80: Purchased Non-Impaired Loans - Cash Flows(a) As of March 2, 2012 In millions Commercial Real Estate Equipment Lease Finance Home Equity Residential Real Estate Credit Card and Other Consumer Commercial Total...

  • Page 181
    ... on risk characteristics of the loan. Our cash flow models use loan data including, but not limited to, delinquency status of the loan, updated borrower FICO credit scores, geographic information, historical loss experience, and updated LTVs, as well as estimates for unemployment rates, home prices...

  • Page 182
    ... Lease Losses and Associated Loan Data In millions Commercial Lending Consumer Lending Total December 31, 2012 Allowance for Loan and Lease Losses January 1 Charge-offs Recoveries Net charge-offs Provision for credit losses Net change in allowance for unfunded loan commitments and letters of credit...

  • Page 183
    ... of Allowance for Loan and Lease Losses and Associated Loan Data (continued from previous page) Commercial Lending Consumer Lending In millions Total December 31, 2010 Allowance for Loan and Lease Losses January 1 Charge-offs Recoveries Net charge-offs Provision for credit losses Adoption of ASU...

  • Page 184
    ... Gains Losses Fair Value December 31, 2012 SECURITIES AVAILABLE FOR SALE Debt securities US Treasury and government agencies Residential mortgage-backed Agency Non-agency Commercial mortgage-backed Agency Non-agency Asset-backed State and municipal Other debt Total debt securities Corporate stocks...

  • Page 185
    ... value of investment securities is impacted by interest rates, credit spreads, market volatility and liquidity conditions. Net unrealized gains and losses in the securities available for sale portfolio are included in shareholders' equity as accumulated other comprehensive income or loss, net of tax...

  • Page 186
    ... Available for Sale In millions Unrealized loss position less than 12 months Unrealized Fair Loss Value Unrealized loss position 12 months or more Unrealized Fair Loss Value Total Unrealized Loss Fair Value December 31, 2012 Debt securities Residential mortgage-backed Agency Non-agency Commercial...

  • Page 187
    ... outstanding cost basis of the security. Non-Agency Commercial Mortgage-Backed Securities Credit losses on these securities are measured using propertylevel cash flow projections and forward-looking property valuations. Cash flows are projected using a detailed analysis of net operating income...

  • Page 188
    ... Gains (Losses) on Sales of Securities Available for Sale In millions Proceeds Gross Gains Gross Losses Net Gains Tax Expense For the year ended December 31 2012 2011 2010 $ 9,441 21,039 23,783 $214 406 490 $ (10) $204 (157) (64) 249 426 $ 71 87 149 The PNC Financial Services Group, Inc. - Form 10...

  • Page 189
    ... 5 Years through 10 Years After 10 Years Total Securities Available for Sale US Treasury and government agencies Residential mortgage-backed Agency Non-agency Commercial mortgage-backed Agency Non-agency Asset-backed State and municipal Other debt Total debt securities available for sale Fair value...

  • Page 190
    .... This category generally includes certain available for sale and trading securities, commercial mortgage loans held for sale, certain residential mortgage loans and loans held for sale, private equity investments, residential mortgage servicing rights, BlackRock Series C Preferred Stock and certain...

  • Page 191
    nonaccrual loans, loans held for sale, commercial mortgage servicing rights, equity investments and other assets. We characterize active markets as those where transaction volumes are sufficient to provide objective pricing information, with reasonably narrow bid/ask spreads and where dealer quotes ...

  • Page 192
    ... (higher) fair value measurement. Prepayment estimates generally increase when market interest rates decline and decrease when market interest rates rise. Credit loss estimates are driven by the ability of borrowers to pay their loans and housing market prices and are impacted by changes in overall...

  • Page 193
    ... the conversion rate of Class B common shares into Visa Class A common shares and to make payments calculated by reference to the market price of the Class A common shares. At December 31, 2012, the estimated fair values of the swap 174 The PNC Financial Services Group, Inc. - Form 10-K liabilities...

  • Page 194
    ... reviews the portfolio company valuations on a quarterly basis and oversight is provided by senior management of the business. We value indirect investments in private equity funds based on net asset value as provided in the financial statements that we receive from their managers. Due to the time...

  • Page 195
    ... also invest based on fixed income and equity-based funds. The Company utilizes a Rabbi Trust to hedge the returns by purchasing the same funds on which the participant returns are based. The Rabbi Trust balances are recorded in Other Assets at fair value using the quoted market price. These assets...

  • Page 196
    ... trading securities Trading loans Residential mortgage servicing rights (g) Commercial mortgage loans held for sale (c) Equity investments Direct investments Indirect investments (h) Total equity investments Customer resale agreements (i) Loans (j) Other assets BlackRock Series C Preferred Stock...

  • Page 197
    ... loans held for sale Trading securities - Debt Residential mortgage servicing rights Commercial mortgage loans held for sale Equity investments Direct investments Indirect investments Total equity investments Loans Other assets BlackRock Series C Preferred Stock Other Total other assets Total assets...

  • Page 198
    ... Total securities available for sale Financial derivatives Trading securities - Debt Residential mortgage servicing rights Commercial mortgage loans held for sale Equity investments Direct investments Indirect investments Total equity investments Loans Other assets BlackRock Series C Preferred Stock...

  • Page 199
    ...Multiple of earnings Net asset value Cumulative default rate Loss Severity Gross discount rate Liquidity discount Liquidity discount 4.5-10.0 (7.1) Commercial mortgage loans held for sale Equity investments - Direct investments Equity investments - Indirect (d) Loans 772 Discounted cash flow 1,171...

  • Page 200
    ... below for equity investments represent the carrying value of Low Income Housing Tax Credit (LIHTC) investments held for sale calculated using a discounted cash flow model. The significant unobservable input is management's estimate of required market rate of return. The market rate of return is...

  • Page 201
    ... branches. Table 96: Fair Value Measurements - Nonrecurring (a) Fair Value December 31 December 31 2012 2011 In millions Assets Nonaccrual loans Loans held for sale Equity investments Commercial mortgage servicing rights OREO and foreclosed assets Long-lived assets held for sale Total assets Year...

  • Page 202
    ...Average) Assets Nonaccrual loans (a) Loans held for sale Equity investments Commercial mortgage servicing rights Other (c) 299 Total Assets $907 $ 90 315 12 191 Fair value of property or collateral Fair value of collateral Discounted cash flow Discounted cash flow Discounted cash flow Loss severity...

  • Page 203
    ... Balances In millions Fair Value Aggregate Unpaid Principal Balance Difference December 31, 2012 Customer resale agreements Trading loans Residential mortgage loans held for sale Performing loans Accruing loans 90 days or more past due Nonaccrual loans Total Commercial mortgage loans held for sale...

  • Page 204
    ...represent the total market value of PNC's assets and liabilities as the table excludes the following: • real and personal property, • lease financing, • loan customer relationships, • deposit customer intangibles, • retail branch networks, • fee-based businesses, such as asset management...

  • Page 205
    ... future principal and interest cash flows, as adjusted for any ALLL recorded for these loans. See Note 6 Purchased Loans for additional information. For revolving home equity loans and commercial credit lines, this fair value does not include any amount for new loans or the related fees that will be...

  • Page 206
    ... quarter, or more frequently if events occur or circumstances have changed significantly from the annual test date. The fair value of our reporting units is determined by using discounted cash flow and, when applicable, market comparability methodologies. Our residential mortgage banking business...

  • Page 207
    ...first quarter of 2012 primarily due to market-driven changes in interest rates. 2010 2011 2012 2013 2014 2015 2016 2017 $304 324 310 243 206 180 156 132 We recognize as an other intangible asset the right to service mortgage loans for others. Commercial MSRs are purchased or originated when loans...

  • Page 208
    ... paid off during the period. (b) Represents MSR value changes resulting primarily from market-driven changes in interest rates, as well as changes in assumptions such as prepayments and servicing costs. We recognize mortgage servicing right assets on residential real estate loans when we retain the...

  • Page 209
    ...have an associated servicing asset. Fees from commercial MSRs, residential MSRs and other loan servicing are reported on our Consolidated Income Statement in the line items Corporate services, Residential mortgage, and Consumer services, respectively. We lease certain facilities and equipment under...

  • Page 210
    ... mortgage and other real estaterelated loans. FHLB advances of $5.0 billion have scheduled maturities of less than one year. The remainder of the FHLB borrowings have balances that will mature from 2013 - 2030, with interest rates ranging from zero to 7.33%. The PNC Financial Services Group...

  • Page 211
    ... issued by various subsidiary statutory trusts. These trust preferred securities represented non-voting preferred beneficial interests in the assets of the following Trusts: Table 114: Capital Securities of Subsidiary Trusts Trust Date Formed Description of Capital Securities Redeemable PNC Capital...

  • Page 212
    ... securities totaled $500 million. We have issued certain hybrid capital vehicles that currently qualify as capital for regulatory purposes. Date Entity (a) Private Placement (b) Rate Trust Issuing Notes (c) February 2008 March 2007 December 2006 PNC Preferred Funding LLC PNC Preferred Funding LLC...

  • Page 213
    ... applicable PNC REIT Corp. holders in exchange for a cash payment representing the market value of such in-kind dividend, and PNC has committed to contribute such inkind dividend to PNC Bank, N.A. (e) Except for: (i) purchases, redemptions or other acquisitions of shares of capital stock of PNC in...

  • Page 214
    ...) acquisition Service cost Interest cost Actuarial (gains)/losses and changes in assumptions Participant contributions Federal Medicare subsidy on benefits paid Early Retirement Reinsurance Program payments received Benefits paid Projected benefit obligation at end of year Fair value of plan assets...

  • Page 215
    ... more market cycles) and is measured over rolling five-year periods. Total return calculations are timeweighted and are net of investment-related fees and expenses. The asset strategy allocations for the Trust at the end of 2012 and 2011, and the target allocation range at the end of 2012, by asset...

  • Page 216
    ...value of the shares held by the pension plan at year end. • U.S. government and agency securities, corporate debt, common stock and preferred stock are valued at the closing price reported on the active market on which the individual securities are traded. If quoted market prices are not available...

  • Page 217
    ...Inputs Inputs (Level 2) (Level 3) In millions December 31 2012 Fair Value Cash Money market funds US government and agency securities Corporate debt (a) Common stock Preferred stock Mutual funds Interest in Collective Funds (b) Limited partnerships Other Total $ 1 92 449 875 984 15 20 1,415 128...

  • Page 218
    ... In millions Interest in Collective Funds Corporate Debt Limited Partnerships Other Preferred Stock January 1, 2012 Net realized gain/(loss) on sale of investments Net unrealized gain/(loss) on assets held at end of year Purchases Sales Transfers into Level 3 Transfers from Level 3 December 31...

  • Page 219
    ... (gain)/loss Net periodic cost (benefit) Other changes in plan assets and benefit obligations recognized in Other comprehensive income: Amortization of prior service (cost)/credit Current year actuarial loss/(gain) Amortization of actuarial gain/(loss) Total recognized in OCI Total recognized in net...

  • Page 220
    ... - 2013 Year ended December 31 In millions Qualified Pension Nonqualified Pension 2013 Estimate Postretirement Benefits Prior service (credit) Net actuarial loss Total $ (8) 86 $78 $8 $8 $(3) $(3) Under the PNC Incentive Savings Plan, employee contributions up to 4% of eligible compensation as...

  • Page 221
    ... of stock and cash. We typically grant a substantial portion of our stock-based compensation awards during the first quarter of the year. As of December 31, 2012, no stock appreciation rights were outstanding. Total compensation expense recognized related to all share-based payment arrangements...

  • Page 222
    ... of market value in 2012, 2011 or 2010. Shares of common stock available during the next year for the granting of options and other awards under the Incentive Plans were 29,192,854 at December 31, 2012. Total shares of PNC common stock authorized for future issuance under equity compensation plans...

  • Page 223
    ... may purchase our common stock at 95% of the fair market value on the last day of each six-month offering period. No charge to earnings is recorded with respect to the ESPP. Table 132: Employee Stock Purchase Plan - Summary Year ended December 31 Shares Issued Purchase Price Per Share 2012 2011...

  • Page 224
    ... to interest rate, market and credit risk and reduce the effects that changes in interest rates may have on net income, fair value of assets and liabilities, and cash flows. We also enter into derivatives with customers to facilitate their risk management activities. Derivatives represent contracts...

  • Page 225
    ... used to economically hedge the change in value of commercial mortgage servicing rights include interest rate swaps and futures. Gains or losses on these derivatives are included in Corporate Services noninterest income. The residential and commercial mortgage loan commitments associated with loans...

  • Page 226
    ... in Other assets and the obligation for cash held is included in Other borrowed funds on our Consolidated Balance Sheet. The credit risk associated with derivatives executed with customers is essentially the same as that involved in extending loans and is subject to normal credit policies. We may...

  • Page 227
    ...hedging instruments under GAAP Interest rate contracts: Cash flow hedges: Receive fixed swaps (c) Forward purchase commitments Subtotal Fair value hedges: Receive fixed swaps (c) Pay fixed swaps (c) (d) Subtotal Foreign exchange contracts: Net investment hedge Total derivatives designated as hedging...

  • Page 228
    ... Value (a) Value (b) Derivatives used for customer-related activities: Interest rate contracts: Swaps Caps/floors - Sold Caps/floors - Purchased Swaptions Futures (e) Mortgage-backed securities commitments Subtotal Foreign exchange contracts Equity contracts Credit contracts: Risk participation...

  • Page 229
    ... Related (Loss) on Hedged Derivatives Items Recognized Recognized in Income in Income Amount Amount Year ended In millions Hedged Items Location Interest rate contracts US Treasury and Government Agencies Securities Other Debt Securities Subordinated debt Bank notes and senior debt Investment...

  • Page 230
    ... Gains (losses) from commercial mortgage banking activities Derivatives used for customer-related activities: Interest rate contracts Foreign exchange contracts Equity contracts Credit contracts Gains (losses) from customer-related activities (c) Derivatives used for other risk management activities...

  • Page 231
    ...: Internal Credit Ratings of Risk Participation Agreements Sold December 31 2012 December 31 2011 The referenced/underlying assets for these credit default swaps follow: Table 140: Referenced/Underlying Assets of Credit Default Swaps Commercial Corporate mortgage-backed Debt securities Loans Pass...

  • Page 232
    NOTE 18 EARNINGS PER SHARE Table 143: Basic and Diluted Earnings per Common Share In millions, except per share data 2012 2011 2010 Basic Net income from continuing operations Less: Net income (loss) attributable to noncontrolling interests Preferred stock dividends and discount accretion and ...

  • Page 233
    ...-to-Floating Rate Non-Cumulative Preferred Stock, Series L was issued in connection with the National City transaction in exchange for National City's Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series F. Dividends on the Series L preferred stock are payable if and when declared each 1st...

  • Page 234
    ... share of PNC common stock at an exercise price of $67.33 per share. These warrants were sold by the US Treasury in a secondary public offering that closed on May 5, 2010 after the US Treasury exchanged its TARP Warrant (issued on December 31, 2008 under the TARP Capital Purchase Program in relation...

  • Page 235
    ... Pretax Tax After-tax Pretax Tax After-tax 2011 activity Net increase in OTTI losses on debt securities Less: Net losses realized on sales of securities Less: Net OTTI losses realized in net income Net unrealized gains (losses) on OTTI securities Balance at December 31, 2011 2012 activity (331...

  • Page 236
    ... and lease losses Compensation and benefits Unrealized losses on loans Loss and credit carryforward Residential mortgage repurchase reserves Other Total gross deferred tax assets Valuation allowance Total deferred tax assets Deferred tax liabilities Leasing Goodwill and intangibles Fixed assets Net...

  • Page 237
    ... for Unrecognized Tax Benefits In millions 2012 2011 2010 Statutory tax rate Increases (decreases) resulting from State taxes net of federal benefit Tax-exempt interest Life insurance Dividend received deduction Tax credits IRS letter ruling and settlements Other Effective tax rate 35.0% 35...

  • Page 238
    ...ability of national banks to pay dividends or make other capital distributions. The amount available for dividend payments to the parent company by PNC Bank, N.A. without prior regulatory approval was approximately $1.5 billion at December 31, 2012. Under federal law, a bank subsidiary generally may...

  • Page 239
    ...for the Eastern District of New York under the caption In re Payment Card Interchange Fee and MerchantDiscount Antitrust Litigation (Master File No. 1:05-md-1720JG-JO). Those cases naming National City were brought as class actions on behalf of all persons or business entities who have accepted Visa...

  • Page 240
    .... PNC Bank, N.A. is not named a defendant in any of the Visa or MasterCard related antitrust litigation nor was it initially a party to the judgment or loss sharing agreements, but it has been subject to these indemnification obligations and became responsible for National City Bank's position in...

  • Page 241
    ... City Bank and RBC Bank (USA) had retail branch operations during the class periods), and subclasses of PNC Bank customers with accounts in Pennsylvania and New Jersey branches, of National City Bank customers with accounts in Illinois branches, and of RBC Bank (USA) customers with accounts in North...

  • Page 242
    ..., against numerous financial companies, including The PNC Financial Services Group, Inc., as successor in interest to National City Corporation, and PNC Investments LLC, as successor in interest to NatCity Investments, Inc. (Federal Home Loan Bank of Chicago v. Bank of America Funding Corp., et al...

  • Page 243
    ... fee splits prohibited under the Real Estate Settlement Procedures Act (RESPA), as well as common law unjust enrichment. The plaintiffs claim, among other things, that from the beginning of 2004 until the end of 2010 National City's captive reinsurer collected from the mortgage insurance company...

  • Page 244
    ... or governmental inquiry with respect to PNC include consumer financial protection, fair lending, mortgage origination and servicing, mortgage-related insurance and reinsurance, municipal finance activities, and participation in government insurance or guarantee programs, some of which are described...

  • Page 245
    ... of our customers to third parties, such as insurance requirements and the facilitation of transactions involving capital markets product execution. Net outstanding standby letters of credit and internal credit ratings were as follows: • 226 The PNC Financial Services Group, Inc. - Form 10-K

  • Page 246
    ... December 31 2012 December 31 2011 • • • Branch banks, Partial interests in companies, or Other types of assets. Net outstanding standby letters of credit Internal credit ratings (as a percentage of portfolio): Pass (a) Below pass (b) (a) Indicates that expected risk of loss is currently...

  • Page 247
    ... our share of such losses. Our exposure and activity associated with these recourse obligations are reported in the Corporate & Institutional Banking segment. Table 154: Analysis of Commercial Mortgage Recourse Obligations In millions 2012 2011 January 1 Reserve adjustments, net Losses - loan...

  • Page 248
    ... activity associated with residential mortgages is reported in the Residential Mortgage Banking segment. PNC's repurchase obligations also include certain brokered home equity loans/lines that were sold to a limited number of private investors in the financial services industry by National City...

  • Page 249
    ... millions December 31 2012 December 31 2011 Accidental Death & Dismemberment Credit Life, Accident & Health Lender Placed Hazard (b) Borrower and Lender Paid Mortgage Insurance Maximum Exposure Percentage of reinsurance agreements: Excess of Loss - Mortgage Insurance Quota Share Maximum Exposure to...

  • Page 250
    ... Acquisition of treasury stock Preferred stock cash dividends paid Common stock cash dividends paid Net cash provided (used) by financing activities Increase (decrease) in cash and due from banks Cash held at banking subsidiary at beginning of year Cash held at banking subsidiary at end of year...

  • Page 251
    ...business customers within our primary geographic markets. Our customers are serviced through our branch network, call centers, online banking and mobile channels. The branch network is located primarily in Pennsylvania, Ohio, New Jersey, Michigan, Illinois, Maryland, Indiana, North Carolina, Florida...

  • Page 252
    ... management services primarily consist of the management of equity, fixed income, multi-asset class, alternative investment and cash management products. BlackRock offers its investment products in a variety of vehicles, including open-end and closed-end mutual funds, iShares® exchange-traded funds...

  • Page 253
    ...Of Businesses Corporate & Institutional Banking Asset Management Group Residential Mortgage Banking Non-Strategic Assets Portfolio Year ended December 31 In millions Retail Banking BlackRock Other Consolidated 2012 Income Statement Net interest income Noninterest income Total revenue Provision...

  • Page 254
    ...(REIT Preferred Securities) with a current distribution rate of 8.7%. The redemption price will be $100,000 per security. The previously declared regular first quarter distribution on the securities is payable on March 15, 2013 to holders of record on March 1, 2013. The PNC Financial Services Group...

  • Page 255
    ... from continuing operations before income taxes and noncontrolling interests Income taxes Net income Less: Net income (loss) attributable to noncontrolling interests Preferred stock dividends and discount accretion Net income attributable to common shareholders Per Common Share Data Book value Basic...

  • Page 256
    ... Money market Demand Savings Retail certificates of deposit Time deposits in foreign offices and other time Total interest-bearing deposits Borrowed funds Federal funds purchased and repurchase agreements Federal Home Loan Bank borrowings Bank notes and senior debt Subordinated debt Commercial...

  • Page 257
    ...-bearing liabilities. Average balances of securities are based on amortized historical cost (excluding adjustments to fair value, which are included in other assets). Average balances for certain loans and borrowed funds accounted for at fair value, with changes in fair value recorded in trading...

  • Page 258
    ... investment securities Loans Commercial Commercial real estate Equipment lease financing Consumer Residential real estate Total loans Loans held for sale Federal funds sold and resale agreements Other Total interest-earning assets Interest-Bearing Liabilities Interest-bearing deposits Money market...

  • Page 259
    ... 2009 2008 Commercial lending Commercial Commercial real estate Equipment lease financing Total commercial lending Consumer lending Home equity Residential real estate Credit card Other consumer Total consumer lending Total loans (a) Includes the impact of the RBC Bank (USA) acquisition, which we...

  • Page 260
    ... Commercial real estate Equipment lease financing Consumer (a) Residential real estate Total recoveries Net charge-offs Provision for credit losses (b) Acquired allowance - National City Other Adoption of ASU 2009-17, Consolidations Net change in allowance for unfunded loan commitments and letters...

  • Page 261
    ...sets forth by quarter the range of high and low sale and quarter-end closing prices for The PNC Financial Services Group, Inc. common stock and the cash dividends declared per common share. High Low Close Cash Dividends Declared 2012 Quarter First Second Third Fourth Total 2011 Quarter First Second...

  • Page 262
    ... our Executive Vice President and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities and Exchange Act of 1934, as amended) were effective as of December 31, 2012, and that there has been no change in PNC's internal control...

  • Page 263
    ...and management is included under the caption "Security Ownership of Directors and Executive Officers" in our Proxy Statement to be filed for the 2013 annual meeting of shareholders and is incorporated herein by reference. Information regarding our compensation plans under which PNC equity securities...

  • Page 264
    ... units payable solely in stock and related dividend equivalents payable solely in cash) that have a service condition, an internal risk-related performance condition and a market condition and also include grants of other stock-payable restricted share units, some of which are time-based and some of...

  • Page 265
    ... of changes in tax law, extraordinary items, discontinued operations, acquisition and merger integration costs, and for the impact of PNC's obligation to fund certain BlackRock long-term incentive programs. Although the size of awards under the plan is dollar-denominated, payment may be made in cash...

  • Page 266
    ... Richard J. Johnson Richard J. Johnson Executive Vice President and Chief Financial Officer February 28, 2013 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of The PNC Financial Services Group, Inc. and in the...

  • Page 267
    ... Corporation's Current Report on Form 8-K filed February 19, 2009 3.1 3.2 Statement with Respect to Shares of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series O dated July 21, 2011 Statement with Respect to Shares of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred...

  • Page 268
    ... Q preferred stock Stock Purchase Contract between National City Corporation and National City Preferred Capital Trust I acting through the Bank of New York Trust Company, N.A. as Property Trustee, dated January 30, 2008 Form of PNC Bank, National Association Global Bank Note for Fixed Rate Global...

  • Page 269
    ... February 13, 2008, between the Corporation and The Bank of New York Exchange Agreement, dated as of February 19, 2008, by and among the Corporation, PNC Bank, National Association, and PNC Preferred Funding Trust III The Corporation's Supplemental Executive Retirement Plan, as amended and restated...

  • Page 270
    ... Exhibit 4.3 to the Registration Statement on Form S-8 filed by the Corporation on January 22, 2009* Incorporated herein by reference to Exhibit 10.61 to the Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2009 (2nd Quarter 2009 Form 10-Q)* Incorporated herein by reference...

  • Page 271
    ... PNC Investment Corp., as settlor, and Hershey Trust Company, as trustee Trust Agreement between PNC Investment Corp., as settlor, and PNC Bank, National Association, as trustee Certificate of Corporate Action for Grantor Trusts effective January 1, 2012 The Corporation's Employee Stock Purchase...

  • Page 272
    ... of the Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 (2nd Quarter 2012 Form 10-Q)* 10.49 10.50 10.51 2008 forms of employee stock option and restricted stock/ share unit agreements 2008 forms of employee performance units agreements Form of employee stock option...

  • Page 273
    .... Exchange Agreement dated as of May 21, 2012 by and among PNC Bancorp, Inc., the Corporation and BlackRock, Inc. PNC Bank, National Association US $20,000,000,000 Global Bank Note Program for the Issue of Senior and Subordinated Bank Notes with Maturities of more than Nine Months from Date of Issue...

  • Page 274
    ... of BlackRock, Inc. as of December 31, 2012 and 2011 and for each of the three years ended December 31, 2012 Consent order between The PNC Financial Services Group, Inc. and the Board of Governors of the Federal Reserve System Consent order between PNC Bank, National Association and the Office of...

  • Page 275
    ... does not relate to Interactive Data Files as defined in Rule 11 of Regulation S-T. CERTIFICATION OF CHIEF EXECUTIVE OFFICER I, James E. Rohr, certify that: 1. 2. I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2012 of The PNC Financial Services Group, Inc.; Based...

  • Page 276
    ...does not relate to Interactive Data Files as defined in Rule 11 of Regulation S-T. CERTIFICATION OF CHIEF FINANCIAL OFFICER I, Richard J. Johnson, certify that: 1. 2. I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2012 of The PNC Financial Services Group, Inc.; Based...

  • Page 277
    ...with the Annual Report on Form 10-K for the year ended December 31, 2012 of The PNC Financial Services Group, Inc. (Corporation) as filed with the Securities and Exchange Commission on the date hereof (Report), I, James E. Rohr, Chairman and Chief Executive Officer of the Corporation, hereby certify...

  • Page 278
    ... with the Annual Report on Form 10-K for the year ended December 31, 2012 of The PNC Financial Services Group, Inc. (Corporation) as filed with the Securities and Exchange Commission on the date hereof (Report), I, Richard J. Johnson, Executive Vice President and Chief Financial Officer of the...

  • Page 279
    ...symbol PNC. Stock Transfer Agent and Registrar Computershare Trust Company, N. A. 250 RoyaII Street Canton, MA 02021 800-982-7652 Dividend Reinvestment and Stock Purchase Plan The PNC Financial Services Group, Inc. Dividend Reinvestment and Stock Purchase Plan enables holders of common and preferred...

  • Page 280
    Corporate Headquarters The PNC Financial Services Group, Inc. One PNC Plaza, 249 Fifth Avenue Pittsburgh, PA 15222-2707 412-762-2000