PNC Bank 2014 Annual Report Download - page 108

addition, rating agencies themselves have been subject to
scrutiny arising from the most recent financial crisis and could
make or be required to make substantial changes to their
ratings policies and practices, particularly in response to
legislative and regulatory changes. Potential changes in the
legislative and regulatory environment and the timing of those
changes could impact our ratings, which as noted above, could
impact our liquidity and financial condition. A decrease, or
potential decrease, in credit ratings could impact access to the
capital markets and/or increase the cost of debt, and thereby
adversely affect liquidity and financial condition.
Table 46: Credit Ratings as of December 31, 2014 for PNC
and PNC Bank
Moody’s
Standard &
Poor’s Fitch
The PNC Financial Services Group, Inc.
Senior debt A3 A- A+
Subordinated debt Baa1 BBB+ A
Preferred stock Baa3 BBB- BBB-
PNC Bank
Senior debt A2 A A+
Subordinated debt A3 A- A
Long-term deposits A2 A AA-
Short-term deposits P-1 A-1 F1+
Commitments
The following tables set forth contractual obligations and various other commitments as of December 31, 2014 representing
required and potential cash outflows.
Table 47: Contractual Obligations
Payment Due By Period
December 31, 2014 – in millions Total
Less than
one year
One to
three years
Four to
five years
After five
years
Remaining contractual maturities of time deposits (a) $21,396 $15,185 $ 2,709 $ 694 $ 2,808
Borrowed funds (a) (b) 56,768 15,243 19,116 13,291 9,118
Minimum annual rentals on noncancellable leases 2,655 376 622 478 1,179
Nonqualified pension and postretirement benefits 519 56 109 108 246
Purchase obligations (c) 703 468 144 63 28
Total contractual cash obligations $82,041 $31,328 $22,700 $14,634 $13,379
(a) Includes purchase accounting adjustments.
(b) Includes basis adjustment relating to accounting hedges.
(c) Includes purchase obligations for goods and services covered by noncancellable contracts and contracts including cancellation fees.
At December 31, 2014, we had unrecognized tax benefits of $77 million, which represents a reserve for tax positions that we have
taken in our tax returns which ultimately may not be sustained upon examination by taxing authorities. Since the ultimate amount
and timing of any future cash settlements cannot be predicted with reasonable certainty, this estimate has been excluded from the
contractual obligations table. See Note 19 Income Taxes in the Notes To Consolidated Financial Statements in Item 8 of this
Report for additional information.
Our contractual obligations totaled $73.5 billion at December 31, 2013. The increase in the comparison is primarily attributable to
an increase in borrowed funds partially offset by the decline in time deposits. See Funding Sources in the Consolidated Balance
Sheet Review section of this Item 7 for additional information regarding our funding sources.
Table 48: Other Commitments (a)
Amount Of Commitment Expiration By Period
December 31, 2014 – in millions
Total
Amounts
Committed
Less than one
year
One to
three years
Four to
five years
After
five years
Net unfunded loan commitments $139,687 $53,849 $47,180 $37,873 $ 785
Net outstanding standby letters of credit (b) 9,991 4,973 4,043 973 2
Reinsurance agreements (c) 4,342 2,071 20 36 2,215
Other commitments (d) 962 693 236 32 1
Total commitments $154,982 $61,586 $51,479 $38,914 $3,003
(a) Other commitments are funding commitments that could potentially require performance in the event of demands by third parties or contingent events. Loan commitments are reported
net of syndications, assignments and participations.
(b) Includes $5.2 billion of standby letters of credit that support remarketing programs for customers’ variable rate demand notes.
(c) Reinsurance agreements are with third-party insurers related to insurance sold to or placed on behalf of our customers. Balances represent estimates based on availability of financial
information.
(d) Includes unfunded commitments related to equity investments of $169 million that were not on our Consolidated Balance Sheet, of which $140 million relate to private equity
investments. The remaining $793 million of commitments were included in Other liabilities on our Consolidated Balance Sheet, of which $717 million related to tax credit
investments.
90 The PNC Financial Services Group, Inc. – Form 10-K