Form: 8-K

Current report filing

October 14, 2022

Documents



Exhibit 99.2

pncbanklogoa18.jpg



THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT
THIRD QUARTER 2022
(Unaudited)



THE PNC FINANCIAL SERVICES GROUP, INC.
FINANCIAL SUPPLEMENT
THIRD QUARTER 2022
(UNAUDITED)
Consolidated Results:
Page
6-7
9-11
Business Segment Results:
12
14-15
18-20

The information contained in this Financial Supplement is preliminary, unaudited and based on data available on October 14, 2022. We have reclassified certain prior period amounts to be consistent with the current period presentation, which we believe is more meaningful to readers of our consolidated financial statements. This information speaks only as of the particular date or dates included in the schedules. We do not undertake any obligation to, and disclaim any duty to, correct or update any of the information provided in this Financial Supplement. Our future financial performance is subject to risks and uncertainties as described in our United States Securities and Exchange Commission (SEC) filings.

BUSINESS
PNC is one of the largest diversified financial services companies in the United States (U.S.) and is headquartered in Pittsburgh, Pennsylvania. PNC has businesses engaged in retail banking, including residential mortgage, corporate and institutional banking and asset management, providing many of its products and services nationally. PNC's retail branch network is located coast-to-coast. PNC also has strategic international offices in four countries outside the U.S.

PRESENTATION OF NONINTEREST INCOME
Effective for the first quarter of 2022, PNC updated the presentation of its noninterest income categorization to be based on product and service type, and accordingly, has changed the basis of presentation of its noninterest income revenue streams to: (i) Asset management and brokerage, (ii) Capital markets related, (iii) Card and cash management, (iv) Lending and deposit services, (v) Residential and commercial mortgage and (vi) Other noninterest income. For a description of each updated noninterest income revenue stream, see our second quarter 2022 Form 10-Q.

ACQUISITION OF BBVA USA BANCSHARES, INC.
On June 1, 2021, PNC acquired BBVA USA Bancshares Inc. (BBVA), a U.S. financial holding company conducting its business operations primarily through its U.S. banking subsidiary, BBVA USA. PNC paid $11.5 billion in cash as consideration for the acquisition.

On October 8, 2021, BBVA USA merged into PNC Bank. As of October 12, 2021, PNC converted approximately 2.6 million
customers, 9,000 employees and over 600 branches across seven states. Our results of operations and balance sheets for all periods presented in this Report reflect the benefit of BBVA’s acquired businesses for the period since the acquisition closed on June 1, 2021.





THE PNC FINANCIAL SERVICES GROUP, INC.
Cross Reference Index to Third Quarter 2022 Financial Supplement (Unaudited)
Financial Supplement Table Reference
Table Description Page
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
14-15
17
18


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 1

Table 1: Consolidated Income Statement (Unaudited)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
In millions, except per share data 2022 2022 2022 2021 2021 2022 2021
Interest Income
Loans $ 3,138  $ 2,504  $ 2,293  $ 2,414  $ 2,437  $ 7,935  $ 6,593 
Investment securities 715  631  544  484  460  1,890  1,350 
Other 279  146  77  77  78  502  216 
Total interest income 4,132  3,281  2,914  2,975  2,975  10,327  8,159 
Interest Expense
Deposits 340  88  27  27  29  455  99 
Borrowed funds 317  142  83  86  90  542  275 
Total interest expense 657  230  110  113  119  997  374 
Net interest income 3,475  3,051  2,804  2,862  2,856  9,330  7,785 
Noninterest Income
Asset management and brokerage 357  365  377  385  375  1,099  1,053 
Capital markets related 299  409  252  460  482  960  1,117 
Card and cash management 671  671  620  646  663  1,962  1,752 
Lending and deposit services 287  282  269  273  305  838  829 
Residential and commercial mortgage 143  161  159  209  248  463  641 
Other (a) 317  177  211  292  268  705  907 
Total noninterest income 2,074  2,065  1,888  2,265  2,341  6,027  6,299 
Total revenue 5,549  5,116  4,692  5,127  5,197  15,357  14,084 
Provision For (Recapture of) Credit Losses 241  36  (208) (327) (203) 69  (452)
Noninterest Expense
Personnel 1,805  1,779  1,717  2,038  1,986  5,301  5,103 
Occupancy 241  246  258  260  248  745  680 
Equipment 344  351  331  437  355  1,026  974 
Marketing 93  95  61  97  103  249  222 
Other 797  773  805  959  895  2,375  2,232 
Total noninterest expense 3,280  3,244  3,172  3,791  3,587  9,696  9,211 
Income before income taxes and noncontrolling interests 2,028  1,836  1,728  1,663  1,813  5,592  5,325 
Income taxes 388  340  299  357  323  1,027  906 
Net income 1,640  1,496  1,429  1,306  1,490  4,565  4,419 
Less: Net income attributable to noncontrolling interests 16  15  21  13  16  52  38 
Preferred stock dividends (b) 65  71  45  71  57  181  162 
Preferred stock discount accretion and
    redemptions		 1  1  2  2  1  4  3 
Net income attributable to common shareholders $ 1,558  $ 1,409  $ 1,361  $ 1,220  $ 1,416  $ 4,328  $ 4,216 
Earnings Per Common Share
Basic $ 3.78  $ 3.39  $ 3.23  $ 2.87  $ 3.31  $ 10.39  $ 9.84 
Diluted $ 3.78  $ 3.39  $ 3.23  $ 2.86  $ 3.30  $ 10.39  $ 9.83 
Average Common Shares Outstanding
Basic 410  414  420  424  426  414  426 
Diluted 410  414  420  424  426  415  427 
Efficiency 59  % 63  % 68  % 74  % 69  % 63  % 65  %
Noninterest income to total revenue 37  % 40  % 40  % 44  % 45  % 39  % 45  %
Effective tax rate from continuing operations (c) 19.1  % 18.5  % 17.3  % 21.5  % 17.8  % 18.4  % 17.0  %
(a)Includes net gains (losses) on sales of securities of less than $1 million, less than $(1) million, $(4) million, $14 million and $15 million for the quarters ended September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021 and September 30, 2021, respectively, and $(4) million and $50 million for the nine months ended September 30, 2022 and September 30, 2021, respectively.
(b)Dividends are payable quarterly other than Series R and Series S preferred stock, which are payable semiannually.
(c)The effective income tax rates are generally lower than the statutory rate due to the relationship of pretax income to tax credits and earnings that are not subject to tax.












THE PNC FINANCIAL SERVICES GROUP, INC.
Page 2
Table 2: Consolidated Balance Sheet (Unaudited)
September 30 June 30 March 31 December 31 September 30
In millions, except par value 2022 2022 2022 2021 2021
Assets
Cash and due from banks $ 6,548  $ 8,582  $ 7,572  $ 8,004  $ 8,843 
Interest-earning deposits with banks (a) 40,278  28,404  48,776  74,250  75,478 
Loans held for sale (b) 1,126  1,191  1,506  2,231  2,121 
Investment securities – available for sale 45,798  52,984  112,313  131,536  124,127 
Investment securities – held to maturity 90,653  79,748  20,098  1,426  1,479 
Loans (b) 315,400  310,800  294,457  288,372  290,230 
Allowance for loan and lease losses (4,581) (4,462) (4,558) (4,868) (5,355)
Net loans 310,819  306,338  289,899  283,504  284,875 
Equity investments 8,130  8,441  7,798  8,180  7,737 
Mortgage servicing rights 3,206  2,608  2,208  1,818  1,833 
Goodwill 10,987  10,916  10,916  10,916  10,885 
Other (b) 41,932  41,574  40,160  35,326  36,137 
Total assets $ 559,477  $ 540,786  $ 541,246  $ 557,191  $ 553,515 
Liabilities
Deposits
Noninterest-bearing $ 138,423  $ 146,438  $ 150,798  $ 155,175  $ 156,305 
Interest-bearing 299,771  294,373  299,399  302,103  292,597 
Total deposits 438,194  440,811  450,197  457,278  448,902 
Borrowed funds
Federal Home Loan Bank borrowings 30,075  10,000 
Bank notes and senior debt 13,357  14,358  16,206  20,661  22,993 
Subordinated debt 7,286  7,487  6,766  6,996  7,074 
Other (b) 3,915  4,139  3,599  3,127  3,404 
Total borrowed funds 54,633  35,984  26,571  30,784  33,471 
Allowance for unfunded lending related commitments 682  681  639  662  646 
Accrued expenses and other liabilities 19,245  15,622  14,623  12,741  14,199 
Total liabilities 512,754  493,098  492,030  501,465  497,218 
Equity
Preferred stock (c)
Common stock - $5 par value
Authorized 800 shares, issued 543 shares 2,714  2,714  2,713  2,713  2,713 
Capital surplus 19,810  18,531  17,487  17,457  17,453 
Retained earnings 52,777  51,841  51,058  50,228  49,541 
Accumulated other comprehensive income (loss) (10,486) (8,358) (5,731) 409  1,079 
Common stock held in treasury at cost: 139, 132, 128, 123, and 120 shares (18,127) (17,076) (16,346) (15,112) (14,527)
Total shareholders’ equity 46,688  47,652  49,181  55,695  56,259 
Noncontrolling interests 35  36  35  31  38 
Total equity 46,723  47,688  49,216  55,726  56,297 
Total liabilities and equity $ 559,477  $ 540,786  $ 541,246  $ 557,191  $ 553,515 
(a)Amounts include balances held with the Federal Reserve Bank of $39.8 billion, $28.0 billion, $48.4 billion, $73.8 billion and $75.1 billion as of September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021 and September 30, 2021, respectively.
(b)Amounts include assets and liabilities for which PNC has elected the fair value option. Our second quarter 2022 Form 10-Q included, and our third quarter 2022 Form 10-Q will include, additional information regarding these items.
(c)Par value less than $0.5 million at each date.



THE PNC FINANCIAL SERVICES GROUP, INC.
Page 3
Table 3: Average Consolidated Balance Sheet (Unaudited) (a) (b)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
In millions 2022 2022 2022 2021 2021 2022 2021
Assets
Interest-earning assets:
Investment securities
Securities available for sale
Residential mortgage-backed
Agency $ 32,500  $ 37,285  $ 67,498  $ 64,521  $ 63,163  $ 45,633  $ 54,900 
Non-agency 748  902 1,007 974 1,051 885 1,142 
Commercial mortgage-backed 3,489  4,362 5,229 5,538 6,134 4,354 6,280 
Asset-backed 110 2,388 6,225 6,206 5,608 2,885 5,590 
U.S. Treasury and government agencies 11,789 17,480 47,468 44,415 38,149 25,448 31,017 
Other 3,506 4,200 4,876 4,741 4,994 4,189 4,889 
Total securities available for sale 52,142 66,617 132,303 126,395 119,099 83,394 103,818
Securities held to maturity
Residential mortgage-backed 39,329  33,086  106  24,317 
Commercial mortgage-backed 2,069  1,175  1,089 
Asset-backed 6,571  4,119  3,587
U.S. Treasury and government agencies 34,279 28,167  919 812 807 21,243 802 
Other 2,600 1,560 569 642 680 1,585 667 
Total securities held to maturity 84,848 68,107 1,594 1,454 1,487 51,821 1,469
Total investment securities 136,990 134,724 133,897 127,849 120,586 135,215 105,287
Loans
Commercial and industrial 172,788 166,968 155,481 152,355 152,964 165,142 140,368 
Commercial real estate 35,140 34,467 34,004 35,256 37,054 34,541 32,452 
Equipment lease financing 6,202 6,200 6,099 6,183 6,300 6,168 6,321 
Consumer 54,563 54,551 54,965 56,244 57,533 54,692 53,695 
Residential real estate 44,333 42,604 40,152 38,872 37,475 42,378 29,048 
Total loans 313,026 304,790 290,701 288,910 291,326 302,921 261,884
Interest-earning deposits with banks (c) 31,892 39,689 62,540 75,377 80,274 44,641 81,383 
Other interest-earning assets 9,560 9,935 9,417 9,113 9,113 9,637 8,345 
Total interest-earning assets 491,468 489,138 496,555 501,249 501,299 492,414 456,899
Noninterest-earning assets 55,629 57,740 53,541 58,123 57,943 56,029 54,065 
Total assets $ 547,097  $ 546,878  $ 550,096  $ 559,372  $ 559,242  $ 548,443  $ 510,964 
Liabilities and Equity
Interest-bearing liabilities:
Interest-bearing deposits
Money market $ 60,934  $ 58,019  $ 62,596  $ 65,214  $ 82,911  $ 60,510  $ 69,105 
Demand 120,358 119,636 112,372 108,345 106,588 117,485 99,154 
Savings 106,761 109,063 108,532 104,644 89,679 108,112 86,662 
Time deposits 10,020 10,378 16,043 18,029 19,293 12,125 18,577 
Total interest-bearing deposits 298,073 297,096 299,543 296,232 298,471 298,232 273,498
Borrowed funds
Federal Home Loan Bank borrowings 16,708 6,978 7,957 883 
Bank notes and senior debt 14,597 16,172 18,015 21,581 22,573 16,249 22,663 
Subordinated debt 7,614 6,998 6,773 6,779 6,787 7,131 6,315 
Other 5,342 5,508 5,524 5,987 4,992 5,457 4,701 
Total borrowed funds 44,261 35,656 30,312 34,347 34,352 36,794 34,562
Total interest-bearing liabilities 342,334 332,752 329,855 330,579 332,823 335,026 308,060
Noninterest-bearing liabilities and equity:
Noninterest-bearing deposits 141,167 149,432 153,726 156,549 155,948 148,062 133,999 
Accrued expenses and other liabilities 15,699 17,116 14,058 16,818 15,332 16,061 14,787 
Equity 47,897 47,578 52,457 55,426 55,139 49,294 54,118 
Total liabilities and equity $ 547,097  $ 546,878  $ 550,096  $ 559,372  $ 559,242  $ 548,443  $ 510,964 
(a)Calculated using average daily balances.
(b)Nonaccrual loans are included in loans, net of unearned income. The impact of financial derivatives used in interest rate risk management is included in the interest income/expense and average yields/rates of the related assets and liabilities. Basis adjustments related to hedged items are included in noninterest-earning assets and noninterest-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 are included in noninterest-earning assets and noninterest-bearing liabilities, with changes in fair value recorded in Noninterest income.
(c)Amounts include average balances held with the Federal Reserve Bank of $31.5 billion, $39.3 billion, $62.3 billion, $75.1 billion and $80.1 billion for the three months ended September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021 and September 30, 2021, and $44.2 billion and $81.1 billion for the nine months ended September 30, 2022 and September 30, 2021, respectively.

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 4
Table 4: Details of Net Interest Margin (Unaudited)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
2022 2022 2022 2021 2021 2022 2021
Average yields/rates (a)
Yield on interest-earning assets
Investment securities
Securities available for sale
Residential mortgage-backed
Agency 2.36  % 2.17  % 1.73  % 1.47  % 1.41  % 2.01  % 1.56  %
Non-agency 7.62  % 7.56  % 7.53  % 7.36  % 8.07  % 7.57  % 7.70  %
Commercial mortgage-backed 2.70  % 2.45  % 2.36  % 2.37  % 2.34  % 2.49  % 2.47  %
Asset-backed 6.31  % 1.84  % 1.35  % 1.48  % 1.50  % 1.56  % 1.80  %
U.S. Treasury and government agencies 1.73  % 1.60  % 1.18  % 1.17  % 1.18  % 1.36  % 1.34  %
Other 2.47  % 2.59  % 2.73  % 2.77  % 2.90  % 2.61  % 3.05  %
Total securities available for sale 2.33  % 2.13  % 1.62  % 1.50  % 1.51  % 1.91  % 1.70  %
Securities held to maturity
Residential mortgage-backed 2.30  % 1.98  % 2.14  %
Commercial mortgage-backed 3.50  % 2.30  % 3.04  %
Asset-backed 2.58  % 1.92  % 2.31  %
U.S. Treasury and government agencies 1.19  % 1.05  % 2.61  % 2.89  % 2.88  % 1.14  % 2.86  %
Other 4.10  % 4.21  % 4.17  % 4.20  % 4.33  % 4.12  % 4.05  %
Total securities held to maturity 1.96  % 1.65  % 2.99  % 3.47  % 3.54  % 1.82  % 3.40  %
Total investment securities 2.10  % 1.89  % 1.64  % 1.52  % 1.54  % 1.88  % 1.73  %
Loans
Commercial and industrial 3.69  % 2.90  % 2.75  % 2.90  % 2.80  % 3.14  % 2.87  %
Commercial real estate 4.27  % 3.15  % 2.79  % 2.86  % 3.17  % 3.44  % 2.98  %
Equipment lease financing 3.85  % 3.62  % 3.74  % 3.81  % 3.83  % 3.73  % 3.83  %
Consumer 5.32  % 4.68  % 4.69  % 4.71  % 4.85  % 4.89  % 4.82  %
Residential real estate 3.21  % 3.11  % 3.10  % 3.26  % 3.15  % 3.12  % 3.35  %
Total loans 3.98  % 3.29  % 3.19  % 3.32  % 3.32  % 3.50  % 3.36  %
Interest-earning deposits with banks 2.32  % 0.79  % 0.19  % 0.15  % 0.16  % 0.87  % 0.12  %
Other interest-earning assets 3.94  % 2.76  % 2.07  % 2.14  % 2.03  % 2.92  % 2.27  %
Total yield on interest-earning assets 3.35  % 2.69  % 2.37  % 2.36  % 2.36  % 2.80  % 2.38  %
Rate on interest-bearing liabilities
Interest-bearing deposits
Money market 0.85  % 0.19  % 0.03  % 0.02  % 0.03  % 0.36  % 0.03  %
Demand 0.59  % 0.15  % 0.02  % 0.02  % 0.03  % 0.26  % 0.03  %
Savings 0.09  % 0.04  % 0.04  % 0.04  % 0.04  % 0.06  % 0.05  %
Time deposits 0.26  % 0.18  % 0.13  % 0.11  % 0.12  % 0.18  % 0.21  %
Total interest-bearing deposits 0.45  % 0.12  % 0.04  % 0.04  % 0.04  % 0.20  % 0.05  %
Borrowed funds
Federal Home Loan Bank borrowings 2.60  % 1.24  % 2.20  % 0.42  %
Bank notes and senior debt 2.96  % 1.61  % 1.02  % 0.94  % 0.97  % 1.80  % 1.00  %
Subordinated debt 3.43  % 1.94  % 1.40  % 1.28  % 1.28  % 2.30  % 1.35  %
Other
2.20  % 1.46  % 0.97  % 0.79  % 0.93  % 1.54  % 1.02  %
Total borrowed funds 2.81  % 1.58  % 1.10  % 0.98  % 1.03  % 1.95  % 1.05  %
Total rate on interest-bearing liabilities 0.75  % 0.27  % 0.13  % 0.13  % 0.14  % 0.39  % 0.16  %
Interest rate spread 2.60  % 2.42  % 2.24  % 2.23  % 2.22  % 2.41  % 2.22  %
Benefit from use of noninterest-bearing sources (b) 0.22  % 0.08  % 0.04  % 0.04  % 0.05  % 0.13  % 0.06  %
Net interest margin 2.82  % 2.50  % 2.28  % 2.27  % 2.27  % 2.54  % 2.28  %
(a)Yields and rates are calculated using the applicable annualized interest income or interest expense divided by the applicable average earning assets or interest-bearing liabilities. Net interest margin is the total yield on interest-earning assets minus the total rate on interest-bearing liabilities and includes the benefit from use of noninterest-bearing sources. To provide more meaningful comparisons of net interest margins, we use net interest income on a taxable-equivalent basis in calculating average yields used in the calculation of net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP in the Consolidated Income Statement. The taxable-equivalent adjustments to net interest income for the three months ended September 30, 2022, June 30, 2022, March 31, 2022, December 31, 2021 and September 30, 2021 were $29 million, $25 million, $22 million, $22 million and $22 million, respectively. The taxable-equivalent adjustments to net interest income for the nine months ended September 30, 2022 and September 30, 2021 were $76 million and $52 million, respectively.
(b)Represents the positive effects of investing noninterest-bearing sources in interest-earning assets.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 5
Table 5: Details of Loans (Unaudited)
September 30 June 30 March 31 December 31 September 30
In millions 2022 2022 2022 2021 2021
Commercial
Commercial and industrial
Manufacturing $ 28,629  $ 27,179  $ 25,035  $ 22,597  $ 22,760 
Retail/wholesale trade 27,532 26,475 25,027 22,803 22,238
Service providers 22,043 21,184 20,584 20,750 20,969
Financial services 21,590 19,594 17,674 17,950 18,022
Real estate related (a) 17,513 16,179 15,459 15,123 14,809
Technology, media & telecommunications 11,366 16,249 10,684 10,070 8,920
Health care 10,420 10,153 9,810 9,944 10,567
Transportation and warehousing 7,977 7,604 7,209 7,136 7,318
Other industries 26,743 27,214 26,392 26,560 27,132
Total commercial and industrial 173,813  171,831  157,874  152,933  152,735 
Commercial real estate 35,592  34,452  34,171  34,015  36,195 
Equipment lease financing 6,192  6,240  6,216  6,130  6,257 
Total commercial 215,597 212,523 198,261 193,078 195,187
Consumer
Residential real estate 45,057  43,717  41,566  39,712  38,214 
Home equity 25,367  24,693  24,185  24,061  24,479 
Automobile 15,025  15,323  16,001  16,635  17,265 
Credit card 6,774  6,650  6,464  6,626  6,466 
Education 2,287  2,332  2,441  2,533  2,653 
Other consumer 5,293  5,562  5,539  5,727  5,966 
Total consumer 99,803  98,277  96,196  95,294  95,043 
Total loans $ 315,400  $ 310,800  $ 294,457  $ 288,372  $ 290,230 
(a)Represents loans to customers in the real estate and construction industries.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 6
Allowance for Credit Losses (Unaudited)

Table 6: Change in Allowance for Loan and Lease Losses
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
Dollars in millions 2022 2022 2022 2021 2021 2022 2021
Allowance for loan and lease losses
Beginning balance $ 4,462  $ 4,558  $ 4,868  $ 5,355  $ 5,730  $ 4,868  $ 5,361 
Acquisition PCD reserves (59) 1,056 
Gross charge-offs:
Commercial and industrial (65) (30) (41) (35) (46) (136) (350)
Commercial real estate (7) (5) (10) (2) (1) (22) (34)
Equipment lease financing (1) (2) (1) (4) (3) (4) (9)
Residential real estate (2) (7) (4) (4) (9) (11)
Home equity (3) (2) (4) (4) (2) (9) (16)
Automobile (32) (34) (52) (49) (33) (118) (120)
Credit card (59) (67) (68) (60) (62) (194) (196)
Education (4) (4) (4) (4) (3) (12) (11)
Other consumer (49) (51) (64) (62) (52) (164) (130)
Total gross charge-offs (222) (195) (251) (224) (206) (668) (877)
Recoveries:
Commercial and industrial 23  15  30  20  25  68  68 
Commercial real estate 1  1  1  2  2  3  5 
Equipment lease financing 1  3  3  3  2  7  8 
Residential real estate 4  6  5  8  9  15  20 
Home equity 19  18  21  23  25  58  63 
Automobile 30  39  31  26  38  100  117 
Credit card 12  19  12  10  13  43  36 
Education 1  2  1  2  2  4  6 
Other consumer 12  9  10  6  9  31  21 
Total recoveries 103  112  114  100  125  329  344 
Net (charge-offs) / recoveries:
Commercial and industrial (42) (15) (11) (15) (21) (68) (282)
Commercial real estate (6) (4) (9) 1  (19) (29)
Equipment lease financing 1  2  (1) (1) 3  (1)
Residential real estate 2  6  (2) 4  5  6  9 
Home equity 16  16  17  19  23  49  47 
Automobile (2) 5  (21) (23) 5  (18) (3)
Credit card (47) (48) (56) (50) (49) (151) (160)
Education (3) (2) (3) (2) (1) (8) (5)
Other consumer (37) (42) (54) (56) (43) (133) (109)
Total net (charge-offs) (a) (119) (83) (137) (124) (81) (339) (533)
Provision for (recapture of) credit losses (b) 241  (10) (172) (362) (229) 59  (525)
Other (3) (3) (1) (1) (6) (7) (4)
Ending balance $ 4,581  $ 4,462  $ 4,558  $ 4,868  $ 5,355  $ 4,581  $ 5,355 
Supplemental Information
Net charge-offs
Commercial net charge-offs $ (48) $ (18) $ (18) $ (16) $ (21) $ (84) $ (312)
Consumer net charge-offs (71) (65) (119) (108) (60) (255) (221)
Total net charge-offs (a) $ (119) $ (83) $ (137) $ (124) $ (81) $ (339) $ (533)
Net charge-offs to average loans (annualized) 0.15  % 0.11  % 0.19  % 0.17  % 0.11  % 0.15  % 0.27  %
Commercial 0.09  % 0.03  % 0.04  % 0.03  % 0.04  % 0.05  % 0.23  %
Consumer 0.28  % 0.27  % 0.51  % 0.45  % 0.25  % 0.35  % 0.36  %
(a)    Amounts for the three months ended June 30, 2021 included $248 million attributable to BBVA, primarily related to commercial and industrial loans, which were largely the result of required purchase accounting treatment for the BBVA acquisition on June 1, 2021.
(b)    See Table 7 for the components of the Provision for (recapture of) credit losses being reported on the Consolidated Income Statement.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 7
Allowance for Credit Losses (Unaudited) (Continued)

Table 7: Components of the Provision for (Recapture of) Credit Losses
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
In millions 2022 2022 2022 2021 2021 2022 2021 (a)
Provision for (recapture of) credit losses
Loans and leases $ 241  $ (10) $ (172) $ (362) $ (229) $ 59  $ (525)
Unfunded lending related commitments 1  42  (23) 16  1  20  16 
Investment securities 3  3  1  25  7  51 
Other financial assets (4) 1  (14) 19  (17) 6 
Total provision for (recapture of) credit losses $ 241  $ 36  $ (208) $ (327) $ (203) $ 69  $ (452)
(a)     Amounts include $1.0 billion of provision for credit losses that was recorded as part of the BBVA acquisition on June 1, 2021.

Table 8: Allowance for Credit Losses by Loan Class (a)
September 30, 2022 June 30, 2022 September 30, 2021

Dollars in millions 		Allowance Amount Total Loans % of Total Loans Allowance Amount Total Loans % of Total Loans Allowance Amount Total Loans % of Total Loans
Allowance for loan and lease losses
Commercial
Commercial and industrial $ 1,974  $ 173,813  1.14  % $ 1,853  $ 171,831  1.08  % $ 2,173  $ 152,735  1.42  %
Commercial real estate 994  35,592  2.79  % 993  34,452  2.88  % 1,312  36,195  3.62  %
Equipment lease financing 93  6,192  1.50  % 91  6,240  1.46  % 118  6,257  1.89  %
Total commercial 3,061  215,597  1.42  % 2,937  212,523  1.38  % 3,603  195,187  1.85  %
Consumer
Residential real estate 50  45,057  0.11  % 36  43,717  0.08  % 42  38,214  0.11  %
Home equity 215  25,367  0.85  % 190  24,693  0.77  % 167  24,479  0.68  %
Automobile 214  15,025  1.42  % 254  15,323  1.66  % 365  17,265  2.11  %
Credit card 732  6,774  10.81  % 715  6,650  10.75  % 701  6,466  10.84  %
Education 64  2,287  2.80  % 63  2,332  2.70  % 81  2,653  3.05  %
Other consumer 245  5,293  4.63  % 267  5,562  4.80  % 396  5,966  6.64  %
Total consumer 1,520  99,803  1.52  % 1,525  98,277  1.55  % 1,752  95,043  1.84  %
Total
 4,581  $ 315,400  1.45  % 4,462  $ 310,800  1.44  % 5,355  $ 290,230  1.85  %
Allowance for unfunded lending related commitments
 682  681  646 
Allowance for credit losses
 $ 5,263  $ 5,143  $ 6,001 
Supplemental Information
Allowance for credit losses to total loans
 1.67  % 1.65  % 2.07  %
Commercial 1.70  % 1.68  % 2.12  %
Consumer 1.60  % 1.60  % 1.96  %
(a)     Excludes allowances for investment securities and other financial assets, which together totaled $162 million, $163 million and $162 million at September 30, 2022, June 30, 2022 and September 30, 2021, respectively.

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 8
Details of Nonperforming Assets (Unaudited)

Table 9: Nonperforming Assets by Type
September 30 June 30 March 31 December 31 September 30
Dollars in millions 2022 2022 2022 2021 2021
Nonperforming loans, including TDRs
Commercial
Commercial and industrial
Service providers $ 223  $ 151  $ 173  $ 188  $ 220 
Retail/wholesale trade 158  87  59  50  59 
Manufacturing 88  101  70  52  62 
Real estate related (a) 47  59  39  64  49 
Health care 45  54  37  46  56 
Transportation and warehousing 29  30  28  18  21 
Technology, media & telecommunications 20  21  36  33  37 
Other industries 138  146  218  345  325 
Total commercial and industrial 748  649  660  796  829 
Commercial real estate 148  161  332  364  365 
Equipment lease financing 7  5  6  8  10 
Total commercial 903  815  998  1,168  1,204 
Consumer (b)
Residential real estate 429  457  526  517  533 
Home equity 530  556  576  596  592 
Automobile 167  175  181  183  184 
Credit card 6  6  8  7  7 
Other consumer 33  37  9  9  8 
Total consumer 1,165  1,231  1,300  1,312  1,324 
Total nonperforming loans (c) 2,068  2,046  2,298  2,480  2,528 
OREO and foreclosed assets 33  29  26  26  31 
Total nonperforming assets $ 2,101  $ 2,075  $ 2,324  $ 2,506  $ 2,559 
Nonperforming loans to total loans 0.66  % 0.66  % 0.78  % 0.86  % 0.87  %
Nonperforming assets to total loans, OREO and foreclosed assets 0.67  % 0.67  % 0.79  % 0.87  % 0.88  %
Nonperforming assets to total assets 0.38  % 0.38  % 0.43  % 0.45  % 0.46  %
Allowance for loan and lease losses to nonperforming loans 222  % 218  % 198  % 196  % 212  %
(a)Represents loans related to customers in the real estate and construction industries.
(b)Excludes most unsecured consumer loans and lines of credit, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.
(c)Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale and loans accounted for under the fair value option.



Table 10: Change in Nonperforming Assets
July 1, 2022 - April 1, 2022 - January 1, 2022 - October 1, 2021 - July 1, 2021 -
In millions September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021 September 30, 2021
Beginning balance $ 2,075  $ 2,324  $ 2,506  $ 2,559  $ 2,818 
New nonperforming assets 438  393  346  395  365 
Charge-offs and valuation adjustments (79) (55) (62) (53) (71)
Principal activity, including paydowns and payoffs (182) (273) (274) (240) (333)
Asset sales and transfers to loans held for sale (3) (6) (21) (3) (30)
Returned to performing status (148) (308) (171) (152) (190)
Ending balance $ 2,101  $ 2,075  $ 2,324  $ 2,506  $ 2,559 




THE PNC FINANCIAL SERVICES GROUP, INC.
Page 9
Accruing Loans Past Due (Unaudited)                  

Under the CARES Act credit reporting rules, certain loans modified due to COVID-19 related hardships are not being reported as past due
for the periods presented based on the contractual terms of the loan, even where borrowers may not be making payments on their loans during the modification period. Our 2021 Form 10-K included additional information on COVID-19 related loan modifications.

Table 11: Accruing Loans Past Due 30 to 59 Days (a)
September 30 June 30 March 31 December 31 September 30
Dollars in millions 2022 2022 2022 2021 2021
Commercial
Commercial and industrial $ 321 $ 99 $ 185 $ 235 $ 97
Commercial real estate 11 28 68 46 68
Equipment lease financing 6 7 20 25 5
Total commercial 338 134 273 306 170
Consumer
Residential real estate
Non government insured 223 230 239 310 178
Government insured 75 68 66 69 81
Home equity 46 43 41 53 45
Automobile 96 102 109 146 114
Credit card 44 37 39 49 42
Education
Non government insured 6 5 5 5 5
Government insured
 30 39 36 38 40
Other consumer 21 38 47 35 34
Total consumer 541 562 582 705 539
Total $ 879 $ 696 $ 855 $ 1,011 $ 709
Supplemental Information
Total accruing loans past due 30-59 days to total loans 0.28  % 0.22  % 0.29  % 0.35  % 0.24  %
Commercial 0.16  % 0.06  % 0.14  % 0.16  % 0.09  %
Consumer 0.54  % 0.57  % 0.61  % 0.74  % 0.57  %
(a)Excludes loans held for sale.



THE PNC FINANCIAL SERVICES GROUP, INC.
Page 10
Accruing Loans Past Due (Unaudited) (Continued)

Table 12: Accruing Loans Past Due 60 to 89 Days (a)
September 30 June 30 March 31 December 31 September 30
Dollars in millions 2022 2022 2022 2021 2021
Commercial
Commercial and industrial $ 55 $ 128 $ 64 $ 72 $ 50
Commercial real estate 4 11 41 24 2
Equipment lease financing 6 4 1 2 4
Total commercial 65 143 106 98 56
Consumer
Residential real estate
Non government insured 49 53 47 78 53
Government insured 46 42 37 41 45
Home equity 16 14 16 18 18
Automobile 21 24 26 40 23
Credit card 30 25 28 33 27
Education
Non government insured
 4 2 3 2 3
Government insured
 22 21 21 23 23
Other consumer 15 21 26 22 15
Total consumer 203 202 204 257 207
Total $ 268 $ 345 $ 310 $ 355 $ 263
Supplemental Information
Total accruing loans past due 60-89 days to total loans 0.08  % 0.11  % 0.11  % 0.12  % 0.09  %
Commercial 0.03  % 0.07  % 0.05  % 0.05  % 0.03  %
Consumer 0.20  % 0.21  % 0.21  % 0.27  % 0.22  %
(a)Excludes loans held for sale.




THE PNC FINANCIAL SERVICES GROUP, INC.
Page 11
Accruing Loans Past Due (Unaudited) (Continued)

Table 13: Accruing Loans Past Due 90 Days or More (a)
September 30 June 30 March 31 December 31 September 30
Dollars in millions 2022 2022 2022 2021 2021
Commercial
Commercial and industrial $ 139 $ 138 $ 105 $ 132 $ 56
Commercial real estate 5 7 1 11
Total commercial 144 138 112 133 67
Consumer
Residential real estate
Non government insured 30 20 41 59 33
Government insured 166 182 232 269 268
Automobile 6 6 8 14 4
Credit card 58 54 62 62 53
Education
Non government insured 2 2 2 2 1
Government insured
 61 56 62 63 60
Other consumer 12 12 15 17 11
Total consumer 335 332 422 486 430
Total $ 479 $ 470 $ 534 $ 619 $ 497
Supplemental Information
Total accruing loans past due 90 days or more to total loans 0.15  % 0.15  % 0.18  % 0.21  % 0.17  %
Commercial 0.07  % 0.06  % 0.06  % 0.07  % 0.03  %
Consumer 0.34  % 0.34  % 0.44  % 0.51  % 0.45  %
Total accruing loans past due $ 1,626 $ 1,511 $ 1,699 $ 1,985 $ 1,469
Commercial $ 547 $ 415 $ 491 $ 537 $ 293
Consumer $ 1,079 $ 1,096 $ 1,208 $ 1,448 $ 1,176
Total accruing loans past due to total loans 0.52  % 0.49  % 0.58  % 0.69  % 0.51  %
Commercial 0.25  % 0.20  % 0.25  % 0.28  % 0.15  %
Consumer 1.08  % 1.12  % 1.26  % 1.52  % 1.24  %
(a)Excludes loans held for sale.





























THE PNC FINANCIAL SERVICES GROUP, INC.
Page 12
Business Segment Descriptions (Unaudited)

Retail Banking provides deposit, lending, brokerage, insurance services, investment management and cash management products and services to consumer and small business customers. Our customers are serviced through our branch network, ATMs, call centers, online banking and mobile channels. As a result of the BBVA acquisition, we have become a coast-to-coast retail bank. Our national expansion strategy is designed to grow customers with digitally-led banking and a thin branch network as we expand into new markets. Deposit products include checking, savings and money market accounts and certificates of deposit. Lending products include residential mortgages, home equity loans and lines of credit, auto loans, credit cards, education loans and personal and small business loans and lines of credit. The residential mortgage loans are directly originated within our branch network and nationwide, and are typically underwritten to agency and/or third-party standards, and either sold, servicing retained or held on our balance sheet. Brokerage, investment management and cash management products and services include managed, education, retirement and trust accounts.

Corporate & Institutional Banking provides lending, treasury management and capital markets related products and services to mid-sized and large corporations, and government and not-for-profit entities. Lending products include secured and unsecured loans, letters of credit and equipment leases. The Treasury Management business provides corporations with cash and investment management services, receivables and disbursement management services, funds transfer services, international payment services and access to online/mobile information management and reporting services. Within Treasury Management, PNC Global Transfers provides wholesale money transfer processing capabilities between the U.S., Mexico and other countries primarily in Central and South America. Capital markets related products and services include foreign exchange, derivatives, fixed income, securities underwriting, loan syndications, mergers and acquisitions advisory and equity capital markets advisory related services. We also provide commercial loan servicing and technology solutions for the commercial real estate finance industry. Products and services are provided nationally.

Asset Management Group provides private banking for high net worth and ultra high net worth clients and institutional asset management. The Asset Management group is composed of two distinct operating units:
•PNC Private Bank provides products and services to emerging affluent, high net worth and ultra high net worth individuals and their families including investment and retirement planning, customized investment management, credit and cash management solutions, trust management and administration. In addition, multi-generational family planning services are also provided to ultra high net worth individuals and their families which include estate, financial, tax, fiduciary and customized performance reporting through PNC Private Bank Hawthorn.
•Institutional Asset Management provides outsourced chief investment officer, custody, private real estate, cash and fixed income client solutions, retirement plan fiduciary investment services to institutional clients including corporations, healthcare systems, insurance companies, unions, municipalities and non-profits.

Table 14: Period End Employees
September 30 June 30 March 31 December 31 September 30
2022 2022 2022 2021 2021
Full-time employees
Retail Banking 33,288  33,565  33,293  32,563  33,188 
Other full-time employees 26,328  25,390  25,037  25,105  25,442 
Total full-time employees 59,616  58,955  58,330  57,668  58,630 
Part-time employees
Retail Banking 1,520  1,712  1,670  1,669  1,616 
Other part-time employees 77  460  82  89  94 
Total part-time employees 1,597  2,172  1,752  1,758  1,710 
Total 61,213  61,127  60,082  59,426  60,340 


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 13
Table 15: Summary of Business Segment Net Income and Revenue (Unaudited) (a)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
In millions 2022 2022 2022 2021 2021 2022 2021
Net Income
Retail Banking $ 560  $ 322  $ 340  $ 362  $ 447  $ 1,222  $ 1,286 
Corporate & Institutional Banking 929  1,003  956  1,334  1,123  2,888  2,990 
Asset Management Group 90  86  102  106  114  278  300 
Other 45  70  10  (509) (210) 125  (195)
Net income excluding noncontrolling
  interests		 $ 1,624  $ 1,481  $ 1,408  $ 1,293  $ 1,474  $ 4,513  $ 4,381 
  
Revenue
Retail Banking $ 2,742  $ 2,410  $ 2,276  $ 2,408  $ 2,375  $ 7,428  $ 6,594 
Corporate & Institutional Banking 2,255  2,221  1,964  2,281  2,306  6,440  6,073 
Asset Management Group 396  387  386  388  397  1,169  1,075 
Other 156  98  66  50  119  320  342 
Total revenue $ 5,549  $ 5,116  $ 4,692  $ 5,127  $ 5,197  $ 15,357  $ 14,084 
(a)Our business information is presented based on our internal management reporting practices. Net interest income in business segment results reflects PNC’s internal funds transfer pricing methodology. Assets receive a funding charge and liabilities and capital receive a funding credit based on a transfer pricing methodology that incorporates product repricing characteristics, tenor and other factors.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 14
Table 16: Retail Banking (Unaudited) (a)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
Dollars in millions 2022 2022 2022 2021 2021 2022 2021
Income Statement
Net interest income $ 2,017  $ 1,662  $ 1,531  $ 1,634  $ 1,713  $ 5,210  $ 4,572 
Noninterest income 725  748  745  774  662  2,218  2,022 
Total revenue 2,742  2,410  2,276  2,408  2,375  7,428  6,594 
Provision for (recapture of) credit losses 92  55  (81) 55  (113) 66  (156)
Noninterest expense 1,901  1,913  1,892  1,874  1,889  5,706  5,042 
Pretax earnings 749  442  465  479  599  1,656  1,708 
Income taxes 175  105  109  112  140  389  396 
Noncontrolling interests 14  15  16  5  12  45  26 
Earnings $ 560  $ 322  $ 340  $ 362  $ 447  $ 1,222  $ 1,286 
Average Balance Sheet
Loans held for sale $ 837  $ 957  $ 1,183  $ 1,425  $ 1,583  $ 991  $ 1,296 
Loans
Consumer
Residential real estate $ 34,465  $ 33,240  $ 31,528  $ 30,888  $ 30,702  $ 33,088  $ 23,323 
Home equity 23,393  22,886  22,458  22,572  23,047  22,916  22,324 
Automobile 15,088  15,566  16,274  16,944  17,377  15,638  15,398 
Credit card 6,684  6,508  6,401  6,513  6,484  6,532  6,070 
Education 2,327  2,410  2,532  2,620  2,712  2,422  2,820 
Other consumer 2,092  2,173  2,348  2,612  2,892  2,204  2,326 
Total consumer 84,049  82,783  81,541  82,149  83,214  82,800  72,261 
Commercial 10,881  11,044  11,610  12,844  15,895  11,176  14,819 
Total loans $ 94,930  $ 93,827  $ 93,151  $ 94,993  $ 99,109  $ 93,976  $ 87,080 
Total assets $ 114,619  $ 113,068  $ 111,754  $ 113,782  $ 117,394  $ 113,157  $ 103,820 
Deposits
Noninterest-bearing $ 65,405  $ 65,599  $ 64,058  $ 65,510  $ 65,985  $ 65,026  $ 55,107 
Interest-bearing 198,956  202,801  201,021  197,312  196,006  200,918  179,567 
Total deposits $ 264,361  $ 268,400  $ 265,079  $ 262,822  $ 261,991  $ 265,944  $ 234,674 
Performance Ratios
Return on average assets 1.94  % 1.14  % 1.23  % 1.26  % 1.51  % 1.44  % 1.66  %
Noninterest income to total revenue 26  % 31  % 33  % 32  % 28  % 30  % 31  %
Efficiency 69  % 79  % 83  % 78  % 80  % 77  % 76  %
(a)See note (a) on page 13.

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 15
Retail Banking (Unaudited) (Continued)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
Dollars in millions, except as noted 2022 2022 2022 2021 2021 2022 2021
Supplemental Noninterest Income Information
Asset management and brokerage $ 131  $ 135  $ 134  $ 131  $ 122  $ 400  $ 334 
Card and cash management $ 344  $ 351  $ 308  $ 347  $ 346  $ 1,003  $ 934 
Lending and deposit services $ 167  $ 167  $ 164  $ 157  $ 180  $ 498  $ 462 
Residential and commercial mortgage $ 38  $ 71  $ 99  $ 101  $ 147  $ 208  $ 355 
Residential Mortgage Information
Residential mortgage servicing statistics
   (in billions, except as noted) (a)
Serviced portfolio balance (b) $ 170  $ 145  $ 135  $ 133  $ 139 
Serviced portfolio acquisitions $ 29  $ 15  $ 6  $ 2  $ 2  $ 50  $ 42 
MSR asset value (b) $ 2.1  $ 1.6  $ 1.3  $ 1.1  $ 1.1 
MSR capitalization value (in basis points) (b) 122  112  98  81  81 
Servicing income: (in millions)
Servicing fees, net (c) $ 50  $ 36  $ 33  $ 14  $ 18  $ 119  $ 20 
Mortgage servicing rights valuation, net of
   economic hedge		 $ (30) $ 13  $ 2  $ 2  $ 24  $ (15) $ 62 
Residential mortgage loan statistics
Loan origination volume (in billions) $ 3.1  $ 4.8  $ 5.1  $ 6.6  $ 7.4  $ 13.0  $ 18.2 
Loan sale margin percentage 1.97  % 1.88  % 2.45  % 2.55  % 3.01  % 2.13  % 2.95  %
Percentage of originations represented by:
Purchase volume (d) 85  % 74  % 42  % 38  % 47  % 64  % 45  %
Refinance volume 15  % 26  % 58  % 62  % 53  % 36  % 55  %
Other Information (b)
Customer-related statistics (average)
Non-teller deposit transactions (e) 65  % 64  % 64  % 64  % 66  % 64  % 66  %
Digital consumer customers (f) 78  % 78  % 78  % 79  % 80  % 78  % 80  %
Credit-related statistics
Nonperforming assets $ 1,027  $ 1,088  $ 1,168  $ 1,220  $ 1,220 
Net charge-offs - loans and leases $ 98  $ 88  $ 141  $ 124  $ 82  $ 327  $ 269 
Other statistics
ATMs 9,169  9,301  9,502  9,523  9,572 
Branches (g) 2,527  2,535  2,591  2,629  2,712 
Brokerage account client assets (in billions) (h) $ 67  $ 68  $ 74  $ 78  $ 76 
(a)Represents mortgage loan servicing balances for third parties and the related income.
(b)Presented as of period end, except for average customer-related statistics and net charge-offs, which are both shown for the three and nine months ended.
(c)Servicing fees net of impact of decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan payments, prepayments and loans that were paid down or paid off during the period.
(d)Mortgages with borrowers as part of residential real estate purchase transactions.
(e)Percentage of total consumer and business banking deposit transactions processed at an ATM or through our mobile banking application.
(f)Represents consumer checking relationships that process the majority of their transactions through non-teller channels.
(g)Excludes stand-alone mortgage offices and satellite offices (e.g., drive-ups, electronic branches and retirement centers) that provide limited products and/or services.
(h)Includes cash and money market balances.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 16
Table 17: Corporate & Institutional Banking (Unaudited) (a)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
Dollars in millions 2022 2022 2022 2021 2021 2022 2021
Income Statement
Net interest income $ 1,368  $ 1,253  $ 1,160  $ 1,228  $ 1,250  $ 3,781  $ 3,343 
Noninterest income 887  968  804  1,053  1,056  2,659  2,730 
Total revenue 2,255  2,221  1,964  2,281  2,306  6,440  6,073 
Provision for (recapture of) credit losses 150  (17) (118) (369) (99) 15  (277)
Noninterest expense 890  934  837  975  980  2,661  2,504 
Pretax earnings 1,215  1,304  1,245  1,675  1,425  3,764  3,846 
Income taxes 281  298  285  337  299  864  846 
Noncontrolling interests 5  3  4  4  3  12  10 
Earnings $ 929  $ 1,003  $ 956  $ 1,334  $ 1,123  $ 2,888  $ 2,990 
Average Balance Sheet
Loans held for sale $ 449  $ 490  $ 628  $ 539  $ 541  $ 522  $ 598 
Loans
Commercial
Commercial and industrial $ 160,140  $ 153,948  $ 141,622  $ 137,079  $ 134,128  $ 151,971  $ 123,505 
Commercial real estate 33,525  32,844  32,433  33,559  35,368  32,938  30,919 
Equipment lease financing 6,202  6,201  6,099  6,184  6,300  6,168  6,321 
Total commercial 199,867  192,993  180,154  176,822  175,796  191,077  160,745 
Consumer 7  14  8  12  20  9  14 
Total loans $ 199,874  $ 193,007  $ 180,162  $ 176,834  $ 175,816  $ 191,086  $ 160,759 
Total assets $ 224,984  $ 219,513  $ 200,724  $ 198,874  $ 202,268  $ 215,163  $ 184,964 
Deposits
Noninterest-bearing $ 73,523  $ 81,028  $ 86,178  $ 88,023  $ 85,869  $ 80,197  $ 76,105 
Interest-bearing 71,925  65,151  68,429  72,397  77,247  68,514  72,147 
Total deposits $ 145,448  $ 146,179  $ 154,607  $ 160,420  $ 163,116  $ 148,711  $ 148,252 
Performance Ratios
Return on average assets 1.64  % 1.83  % 1.93  % 2.66  % 2.20  % 1.79  % 2.16  %
Noninterest income to total revenue 39  % 44  % 41  % 46  % 46  % 41  % 45  %
Efficiency 39  % 42  % 43  % 43  % 42  % 41  % 41  %
Other Information
Consolidated revenue from:
Treasury Management (b) $ 753  $ 659  $ 546  $ 560  $ 592  $ 1,958  $ 1,609 
Commercial mortgage banking activities:
Commercial mortgage loans held for sale (c) $ 26  $ 20  $ 16  $ 42  $ 44  $ 62  $ 103 
Commercial mortgage loan servicing income (d) 66  70  68  90  88  204  244 
Commercial mortgage servicing rights
   valuation, net of economic hedge		 53  33  13  16  14  99  64 
Total $ 145  $ 123  $ 97  $ 148  $ 146  $ 365  $ 411 
MSR asset value (e) $ 1,132  $ 988  $ 886  $ 740  $ 703 
Average loans by C&IB business
Corporate Banking $ 109,197  $ 103,595  $ 92,503  $ 87,284  $ 85,208  $ 101,826  $ 78,975 
Real Estate 45,837  44,202  43,213  44,787  47,335  44,427  42,313 
Business Credit 28,930  28,246  26,535  26,065  25,540  27,913  23,367 
Commercial Banking 9,008  9,459  10,045  10,924  13,458  9,500  12,435 
Other 6,902  7,505  7,866  7,774  4,275  7,420  3,669 
Total average loans $ 199,874  $ 193,007  $ 180,162  $ 176,834  $ 175,816  $ 191,086  $ 160,759 
Credit-related statistics
Nonperforming assets (e) $ 779  $ 674  $ 866  $ 1,007  $ 1,061 
Net charge-offs (recoveries) - loans and leases $ 33  $ 11  $ (1) $ (1) $ 13  $ 43  $ 290 
(a)See note (a) on page 13.
(b)Amounts are reported in net interest income and noninterest income.
(c)Represents commercial mortgage banking income for valuations on commercial mortgage loans held for sale and related commitments, derivative valuations, origination fees, gains on sale of loans held for sale and net interest income on loans held for sale.
(d)Represents net interest income and noninterest income from loan servicing, net of reduction in commercial mortgage servicing rights due to ammortization expense and payoffs. Commercial mortgage servicing rights valuation, net of economic hedge is shown separately.
(e)Presented as of period end.

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Table 18: Asset Management Group (Unaudited) (a)
Three months ended Nine months ended
September 30 June 30 March 31 December 31 September 30 September 30 September 30
Dollars in millions, except as noted 2022 2022 2022 2021 2021 2022 2021
Income Statement
Net interest income $ 165  $ 153  $ 138  $ 130  $ 141  $ 456  $ 346 
Noninterest income 231  234  248  258  256  713  729 
Total revenue 396  387  386  388  397  1,169  1,075 
Provision for (recapture of) credit losses 4  5  2  (15) (6) 11  8 
Noninterest expense 274  270  251  265  255  795  676 
Pretax earnings 118  112  133  138  148  363  391 
Income taxes 28  26  31  32  34  85  91 
Earnings $ 90  $ 86  $ 102  $ 106  $ 114  $ 278  $ 300 
Average Balance Sheet
Loans
Consumer
Residential real estate $ 8,430  $ 7,835  $ 6,989  $ 6,295  $ 5,727  $ 7,756  $ 4,608 
Other consumer 4,640  4,633  4,541  4,535  4,544  4,605  4,249 
Total consumer 13,070  12,468  11,530  10,830  10,271  12,361  8,857 
Commercial 1,328  1,560  1,848  2,093  2,693  1,577  1,629 
Total loans $ 14,398  $ 14,028  $ 13,378  $ 12,923  $ 12,964  $ 13,938  $ 10,486 
Total assets $ 14,820  $ 14,449  $ 13,801  $ 13,317  $ 13,805  $ 14,360  $ 11,124 
Deposits
Noninterest-bearing $ 2,286  $ 2,824  $ 3,458  $ 3,025  $ 4,332  $ 2,852  $ 2,884 
Interest-bearing 27,054  28,839  29,830  26,318  24,984  28,564  21,590 
Total deposits $ 29,340  $ 31,663  $ 33,288  $ 29,343  $ 29,316  $ 31,416  $ 24,474 
Performance Ratios
Return on average assets 2.41  % 2.39  % 3.00  % 3.16  % 3.28  % 2.59  % 3.61  %
Noninterest income to total revenue 58  % 60  % 64  % 66  % 64  % 61  % 68  %
Efficiency 69  % 70  % 65  % 68  % 64  % 68  % 63  %
Other Information
Nonperforming assets (b) $ 95  $ 114  $ 72  $ 62  $ 80 
Net charge-offs (recoveries) - loans and leases $ (2) $ (1) $ 2  $ 1  $ (1) $ (1) $ 1 
Brokerage account client assets (in billions) (b) $ 4  $ 4  $ 5  $ 5  $ 5 
Client Assets Under Administration
     (in billions) (b) (c)
Discretionary client assets under management $ 166  $ 167  $ 182  $ 192  $ 183 
Nondiscretionary client assets under administration 148  153  165  175  170 
Total $ 314  $ 320  $ 347  $ 367  $ 353 
Discretionary client assets under management
PNC Private Bank $ 99  $ 103  $ 115  $ 123  $ 117 
Institutional Asset Management 67  64  67  69  66 
Total $ 166  $ 167  $ 182  $ 192  $ 183 
(a)See note (a) on page 13.
(b)As of period end.
(c)Excludes brokerage account client assets.

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Glossary of Terms

2019 Tailoring Rules – Rules adopted by the federal banking agencies to better tailor the application of their capital, liquidity, and enhanced prudential requirements for banking organizations to the asset size and risk profile (as measured by certain regulatory metrics) of the banking organization. Effective January 1, 2020, the agencies' capital and liquidity rules classify all BHCs with $100 billion or more in total assets into one of four categories (Category I, Category II, Category III, and Category IV).

Adjusted average total assets - Primarily consisted of total average quarterly (or annual) assets plus/less unrealized losses (gains) on investment securities, less goodwill and certain other intangible assets (net of eligible deferred taxes).

Allowance for credit losses (ACL) – A valuation account that is deducted from or added to the amortized cost basis of the related
financial assets to present the net carrying value at the amount expected to be collected on the financial asset.

Amortized cost basis - Amount at which a financial asset is originated or acquired, adjusted for applicable accretion or amortization of premiums, discounts and net deferred fees or costs, collection of cash, charge-offs, foreign exchange and fair value hedge accounting adjustments.

Basel III common equity Tier 1 (CET1) capital (Tailoring Rules) - Common stock plus related surplus, net of treasury stock, plus retained earnings, less goodwill, net of associated deferred tax liabilities, less other disallowed intangibles, net of deferred tax liabilities and plus/less other adjustments. Investments in unconsolidated financial institutions, as well as mortgage servicing rights and deferred tax assets, must then be deducted to the extent such items (net of associated deferred tax liabilities) individually exceed 25% of our adjusted Basel III common equity Tier 1 capital.

Basel III common equity Tier 1 capital ratio - Common equity Tier 1 capital divided by period-end risk-weighted assets (as applicable).

Basel III Tier 1 capital - Common equity Tier 1 capital, plus qualifying preferred stock, plus certain trust preferred capital securities, plus certain noncontrolling interests that are held by others and plus/less other adjustments.

Basel III Tier 1 capital ratio - Tier 1 capital divided by period-end risk-weighted assets (as applicable).

Basel III Total capital - Tier 1 capital plus qualifying subordinated debt, plus certain trust preferred securities, plus, under the Basel III transitional rules and the standardized approach, the allowance for loan and lease losses included in Tier 2 capital and other.

Basel III Total capital ratio - Basel III Total capital divided by period-end risk-weighted assets (as applicable).

BBVA – BBVA USA Bancshares, Inc.

BBVA, S.A. – Banco Bilbao Vizcaya Argentaria, S.A.

BBVA USA – BBVA USA, the Alabama-chartered bank subsidiary of BBVA USA Bancshares, Inc.

BlackRock – BlackRock, Inc.

Charge-off - Process of removing a loan or portion of a loan from our balance sheet because it is considered uncollectible. We also record a charge-off when a loan is transferred from portfolio holdings to held for sale by reducing the loan carrying amount to the fair value of the loan, if fair value is less than carrying amount.

Common shareholders’ equity - Total shareholders' equity less the liquidation value of preferred stock.

Credit valuation adjustment - Represents an adjustment to the fair value of our derivatives for our own and counterparties’ non-performance risk.

Criticized commercial loans - Loans with potential or identified weaknesses based upon internal risk ratings that comply with the regulatory classification definitions of “Special Mention,” “Substandard” or “Doubtful.”

Current Expected Credit Loss (CECL) - Methodology for estimating the allowance for credit losses on in-scope financial assets held at amortized cost and unfunded lending related commitments which uses a combination of expected losses over a reasonable and supportable forecast period, a reversion period and long run average credit losses for their estimated contractual term.


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Discretionary client assets under management - Assets over which we have sole or shared investment authority for our customers/clients. We do not include these assets on our Consolidated Balance Sheet.

Earning assets - Assets that generate income, which include: interest-earning deposits with banks; loans held for sale; loans; investment securities; and certain other assets.

Effective duration - A measurement, expressed in years, that, when multiplied by a change in interest rates, would approximate the percentage change in value of on- and off- balance sheet positions.

Efficiency - Noninterest expense divided by total revenue.

Fair value - The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Fee income - Refers to the following categories within Noninterest income: Asset management; Consumer services; Corporate services; Residential mortgage; and Service charges on deposits.

FICO score - A credit bureau-based industry standard score created by Fair Isaac Co. which predicts the likelihood of borrower default. We use FICO scores both in underwriting and assessing credit risk in our consumer lending portfolio. Lower FICO scores indicate likely higher risk of default, while higher FICO scores indicate likely lower risk of default. FICO scores are updated on a periodic basis.

GAAP - Accounting principles generally accepted in the United States of America.

Leverage ratio - Basel III Tier 1 capital divided by average quarterly adjusted total assets.

Nondiscretionary client assets under administration - Assets we hold for our customers/clients in a nondiscretionary, custodial capacity. We do not include these assets on our Consolidated Balance Sheet.

Nonperforming assets - Nonperforming assets include nonperforming loans, OREO and foreclosed assets. We do not accrue interest income on assets classified as nonperforming.

Nonperforming loans - Loans accounted for at amortized cost whose credit quality has deteriorated to the extent that full collection of contractual principal and interest is not probable, including TDRs which have not returned to performing status. Interest income is not recognized on nonperforming loans. Nonperforming loans exclude certain government insured or guaranteed loans for which we expect to collect substantially all principal and interest, loans held for sale and loans accounted for under the fair value option.

Operating leverage - The period to period dollar or percentage change in total revenue less the dollar or percentage change in noninterest expense. A positive variance indicates that revenue growth exceeded expense growth (i.e., positive operating leverage) while a negative variance implies expense growth exceeded revenue growth (i.e., negative operating leverage).

Other real estate owned (OREO) and foreclosed assets - Assets taken in settlement of troubled loans primarily through deed-in-lieu of foreclosure or foreclosure. Foreclosed assets include real and personal property. Certain assets that have a government-guarantee which are classified as other receivables are excluded.

Purchased credit deteriorated assets (PCD) - Acquired loans or debt securities that, at acquisition, are determined to have experienced a more-than-insignificant deterioration in credit quality since origination or issuance.

Risk-weighted assets - Computed by the assignment of specific risk-weights (as defined by the Board of Governors of the Federal Reserve System) to assets and off-balance sheet instruments.

Servicing rights - Intangible assets or liabilities created by an obligation to service assets for others. Typical servicing rights include the right to receive a fee for collecting and forwarding payments on loans and related taxes and insurance premiums held in escrow.

Supplementary leverage ratio - Basel III Tier 1 capital divided by Supplementary leverage exposure.

Taxable-equivalent interest income - The interest income earned on certain assets that is completely or partially exempt from federal income tax. These tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of yields and margins for all interest-earning assets, we use interest income on a taxable-equivalent basis in calculating average yields and net interest margins by increasing the interest income earned on tax-exempt assets to make it fully equivalent to

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interest income earned on other taxable investments. This adjustment is not permitted under GAAP on the Consolidated Income Statement.

Troubled debt restructuring (TDR) - A loan whose terms have been restructured in a manner that grants a concession to a borrower experiencing financial difficulties.

Unfunded lending related commitments - Standby letters of credit, financial guarantees, commitments to extend credit and similar unfunded obligations that are not unilaterally, unconditionally, cancelable at PNC’s option.

Yield curve - A graph showing the relationship between the yields on financial instruments or market indices of the same credit quality with different maturities. For example, a “normal” or “positive” yield curve exists when long-term bonds have higher yields than short-term bonds. A “flat” yield curve exists when yields are the same for short-term and long-term bonds. A “steep” yield curve exists when yields on long-term bonds are significantly higher than on short-term bonds. An “inverted” or “negative” yield curve exists when short-term bonds have higher yields than long-term bonds.