Exhibit 99 CONTACTS: MEDIA: Jonathan Williams (412) 762-4550 pubrela@pncmail.com INVESTORS: William H. Callihan (412) 762-8257 invrela@pncmail.com PNC BANK CORP. REPORTS FIRST QUARTER 1998 EARNINGS PITTSBURGH, April 14, 1998 - PNC Bank Corp. (NYSE: PNC) today reported first quarter 1998 earnings of $269 million or $0.87 per diluted share compared with $266 million or $0.80 per diluted share in the first quarter of 1997. Returns on average common shareholders' equity and average assets were 21.10% and 1.51% for the first quarter of 1998 compared with 19.48% and 1.54% for the prior-year quarter. "First quarter results reflect solid performance from our major businesses including significant growth in asset management, mutual fund servicing and mortgage banking," said Thomas H. O'Brien, chairman and chief executive officer. "Our fee-based financial services businesses continue to have a very positive impact on our revenue stream with noninterest income rising to 46% of total revenue during the quarter compared with 40% in 1997." HIGHLIGHTS * Revenue increased 11% in the quarter-to-quarter comparison driven by 24% growth in noninterest income. * Asset management, mutual fund servicing and mortgage banking revenue grew 32%, 24% and 93%, respectively, from the first quarter of 1997. * PNC Bank's fixed-income, equity and liquidity capabilities were consolidated under BlackRock, Inc. creating one of the largest asset managers in the U.S. * The acquisition of Midland Loan Services, L.P. was completed on April 3, 1998 creating a fully-integrated commercial real estate business with capabilities to originate, warehouse, securitize and service commercial mortgages. -more- PNC Bank Corp. Reports First Quarter 1998 Earnings Page 2 INCOME STATEMENT REVIEW Total revenue increased to $1.2 billion in the quarter-to-quarter comparison driven by growth in noninterest income. Taxable-equivalent net interest income increased $7 million to $644 million in the first quarter of 1998. The net interest margin was 3.96% compared with 3.98% in the first quarter of 1997. The provision for credit losses was $30 million for the first quarter of 1998 compared with $10 million last year. Noninterest income was $539 million in the first quarter of 1998, a $106 million or 24% increase from the prior-year quarter driven by growth in asset management, mutual fund servicing and mortgage banking. Asset management and mutual fund servicing grew 32% and 24%, respectively, from the first quarter of 1997 reflecting significant new business and strong financial markets. Managed assets increased to approximately $148 billion at March 31, 1998 compared with $115 billion a year ago. Mortgage banking revenue grew primarily due to higher marketing gains and origination volume reflecting significant mortgage refinance activity in the first quarter of 1998. Mortgage originations totaled $2.3 billion compared with $1.1 billion in the year-earlier period. At March 31, 1998, the corporation serviced approximately $42.5 billion of mortgages including $33.6 billion serviced for others. Net securities gains were $23 million in the first quarter of 1998 including $9 million from sales of securities that hedged mortgage servicing rights ("MSR"). The increase in other income reflects the impact of the sale of equity in the new BlackRock to management. Noninterest expense increased $97 million to $741 million in the first quarter of 1998 primarily due to MSR amortization, incentive compensation commensurate with growth in fee-based revenue and higher marketing costs associated with national consumer banking initiatives. -more- PNC Bank Corp. Reports First Quarter 1998 Earnings Page 3 BALANCE SHEET REVIEW Total assets were $72.4 billion at March 31, 1998. Average earning assets increased $1.4 billion from the prior-year quarter to $65.2 billion as higher loans and mortgages held for sale more than offset securities portfolio reductions. Average loans grew 4.2% to $54.1 billion, a $2.2 billion increase from the prior year. Loans represented 83.0% of average earning assets compared with 81.4% a year ago. Growth in credit cards and middle market commercial loans more than offset the downsizing of the indirect automobile lending portfolio and the impact of loan securitizations. The increase in average mortgages held for sale was $1.4 billion reflecting higher production volume. Average securities decreased $2.3 billion to $7.8 billion or 11.9% of average earning assets. Average deposits increased $497 million to $44.6 billion in the first quarter of 1998 representing 61.9% of total sources of funds. The ratio of wholesale funds to total sources of funds was 28.3% for the first quarter of 1998 compared with 27.9% a year ago. Shareholders' equity totaled $5.5 billion at March 31, 1998. The leverage ratio was 7.36% and Tier I and total risk-based capital ratios are estimated to be 7.7% and 11.2%, respectively. The ratio of nonperforming assets to total loans and foreclosed assets was 0.61% at March 31, 1998 compared with 0.82% at March 31, 1997. Nonperforming assets were $335 million at March 31, 1998 compared with $429 million a year ago. The allowance for credit losses was $912 million at March 31, 1998, and represented 321% of nonperforming loans compared with 346% at March 31, 1997. Net charge-offs were $90 million or 0.67% of average loans in the first quarter of 1998 compared with $60 million and 0.47%, respectively, in the year-earlier period. The increases were primarily associated with higher credit card outstandings. -more- PNC Bank Corp. Reports First Quarter 1998 Earnings Page 4 PNC Bank Corp., headquartered in Pittsburgh, is one of the largest diversified financial services organizations in the United States. Its major businesses include National Consumer Banking, Regional Community Banking, Private Banking, Secured Lending, Asset Management and Servicing, Corporate Banking and Mortgage Banking. Visit PNC Bank on the World Wide Web at http://www.pncbank.com [TABULAR MATERIAL FOLLOWS] -more- PNC BANK CORP. AND SUBSIDIARIES Page 5 Consolidated Financial Highlights
March 31 December 31 March 31 Three months ended 1998 1997 1997 - ------------------------------------------------------------------------------------------------------------------------------------ FINANCIAL PERFORMANCE (in thousands, except per share data) Revenue Net interest income (taxable-equivalent basis) $644,230 $638,912 $637,283 Noninterest income 538,915 518,063 433,303 Total revenue 1,183,145 1,156,975 1,070,586 Net income 269,260 265,489 266,309 Per common share Diluted earnings .87 .85 .80 Cash dividends declared .39 .39 .37 SELECTED RATIOS Return on Average common shareholders' equity 21.10% 20.28% 19.48% Average assets 1.51 1.49 1.54 Net interest margin 3.96 3.95 3.98 Noninterest income to total revenue 45.55 44.78 40.47 After-tax profit margin 22.76 22.95 24.88 Efficiency ratio (excluding distributions on capital securities) 61.53 60.69 59.54 Net charge-offs to average loans .67 .59 .47
March 31 December 31 September 30 June 30 March 31 1998 1997 1997 1997 1997 - ----------------------------------------------------------------------------------------------------------------------------------- BALANCE SHEET DATA (in millions) Assets $72,355 $75,120 $71,828 $71,973 $71,166 Earning assets 65,210 66,688 64,208 64,297 64,255 Loans, net of unearned income 54,511 54,245 53,651 53,497 52,575 Securities 7,511 8,522 8,000 8,396 9,593 Deposits 46,068 47,649 44,788 45,216 44,902 Borrowed funds 18,375 19,622 19,052 19,066 18,547 Shareholders' equity 5,487 5,384 5,476 5,384 5,478 Common shareholders' equity 5,173 5,069 5,161 5,068 5,162 CAPITAL RATIOS Leverage 7.36% 7.30% 7.46% 7.35% 7.17% Common shareholders' equity to assets 7.15 6.75 7.18 7.04 7.25 ASSET QUALITY RATIOS Nonperforming assets to loans and foreclosed assets .61% .61% .73% .83% .82% Allowance for credit losses to loans 1.67 1.79 1.91 2.01 2.13 Allowance for credit losses to nonperforming loans 320.96 351.79 324.25 310.34 346.11 Book value per common share $17.20 $16.87 $16.92 $16.51 $16.45 ===================================================================================================================================
-more- PNC BANK CORP. AND SUBSIDIARIES Page 6 Consolidated Statement of Income
March 31 December 31 March 31 Three months ended - in thousands, except per share data 1998 1997 1997 - ---------------------------------------------------------------------------------------------------------------- INTEREST INCOME Loans and fees on loans $1,118,644 $1,117,551 $1,055,908 Securities 115,253 119,366 156,205 Other 57,610 44,426 30,043 ------------------------------------- Total interest income 1,291,507 1,281,343 1,242,156 INTEREST EXPENSE Deposits 361,522 369,572 346,155 Borrowed funds 292,581 279,570 266,076 ------------------------------------- Total interest expense 654,103 649,142 612,231 ------------------------------------- Net interest income 637,404 632,201 629,925 Provision for credit losses 30,000 25,000 10,000 ------------------------------------- Net interest income less provision for credit losses 607,404 607,201 619,925 NONINTEREST INCOME Asset management 141,065 128,916 106,899 Mutual fund servicing 40,521 37,493 32,673 Service charges on deposits 39,964 42,546 41,754 Consumer service fees 88,943 94,351 76,311 Corporate finance and capital markets 51,712 55,891 49,356 Mortgage banking 77,694 57,905 40,232 Net securities gains 22,842 21,434 16,426 Other 76,174 79,527 69,652 ------------------------------------- Total noninterest income 538,915 518,063 433,303 NONINTEREST EXPENSE Staff expense 354,284 322,188 308,432 Net occupancy and equipment 95,809 97,611 89,284 Amortization 57,179 56,104 29,831 Marketing 37,396 10,742 22,841 Distributions on capital securities 13,193 13,123 6,956 Other 183,379 215,493 187,047 ------------------------------------- Total noninterest expense 741,240 715,261 644,391 Income before income taxes 405,079 410,003 408,837 Income taxes 135,819 144,514 142,528 ------------------------------------- Net income $269,260 $265,489 $266,309 - ---------------------------------------------------------------------------------------------------------------- Net income applicable to common shareholders $265,249 $261,675 $262,541 EARNINGS PER COMMON SHARE Basic $.88 $.86 $.81 Diluted .87 .85 .80 CASH DIVIDENDS DECLARED PER COMMON SHARE .39 .39 .37 AVERAGE COMMON SHARES OUTSTANDING Basic 300,567 303,207 321,752 Diluted 306,148 309,533 327,917 ================================================================================================================
-more- PNC BANK CORP. AND SUBSIDIARIES Page 7 Details of Net Interest Income and Net Interest Margin
NET INTEREST INCOME Taxable-equivalent basis March 31 December 31 September 30 June 30 March 31 Three months ended - in thousands 1998 1997 1997 1997 1997 - ----------------------------------------------------------------------------------------------------------------------------- Interest income Loans $1,124,112 $1,123,127 $1,107,250 $1,084,532 $ 1,061,535 Securities 116,507 120,395 127,053 140,618 157,870 Other 57,714 44,532 43,555 39,416 30,109 --------------------------------------------------------------- Total interest income 1,298,333 1,288,054 1,277,858 1,264,566 1,249,514 Interest expense Deposits 361,522 369,572 372,860 368,000 346,155 Borrowed funds 292,581 279,570 277,567 275,985 266,076 --------------------------------------------------------------- Total interest expense 654,103 649,142 650,427 643,985 612,231 --------------------------------------------------------------- Net interest income $644,230 $638,912 $627,431 $620,581 $637,283 =============================================================================================================================
NET INTEREST MARGIN Taxable-equivalent basis March 31 December 31 September 30 June 30 March 31 Three months ended 1998 1997 1997 1997 1997 - ------------------------------------------------------------------------------------------------------------------------------- Rates earned/paid Yield on earning assets Loans 8.36% 8.27% 8.23% 8.19% 8.20% Securities 6.01 6.19 6.17 6.21 6.27 Other 6.96 6.68 6.83 6.76 6.68 Total yield on earning assets 8.00 7.96 7.92 7.85 7.86 Rate on interest-bearing liabilities Deposits 4.19 4.23 4.23 4.18 4.06 Borrowed funds 5.85 5.91 5.92 5.88 5.76 Total rate on interest-bearing liabilities 4.79 4.82 4.82 4.77 4.66 ------------------------------------------------------- Interest rate spread 3.21 3.14 3.10 3.08 3.20 Impact of noninterest-bearing sources .75 .81 .79 .76 .78 ------------------------------------------------------- Net interest margin 3.96% 3.95% 3.89% 3.84% 3.98% ==============================================================================================================================
-more- PNC BANK CORP. AND SUBSIDIARIES Page 8 Details of Noninterest Income and Noninterest Expense
NONINTEREST INCOME March 31 December 31 September 30 June 30 March 31 Three months ended - in thousands 1998 1997 1997 1997 1997 - ---------------------------------------------------------------------------------------------------------------------------- Asset management $141,065 $128,916 $115,197 $110,500 $106,899 Mutual fund servicing 40,521 37,493 35,608 35,518 32,673 Service charges on deposits 39,964 42,546 42,875 42,379 41,754 Consumer service fees Credit card 26,492 28,802 23,292 21,960 19,104 Brokerage 15,156 14,230 14,138 12,731 13,242 Insurance 9,989 10,543 10,421 9,659 9,146 Other 37,306 40,776 37,428 38,386 34,819 ------------------------------------------------------------- Total consumer service fees 88,943 94,351 85,279 82,736 76,311 Corporate finance and capital markets 51,712 55,891 46,992 51,982 49,356 Mortgage banking Servicing 29,194 30,503 30,316 27,963 27,449 Origination 17,260 14,070 13,597 10,960 8,187 Marketing 24,522 12,869 27,360 3,848 3,421 Sales of servicing 6,718 463 683 494 1,175 ------------------------------------------------------------- Total mortgage banking 77,694 57,905 71,956 43,265 40,232 Net securities gains (losses) 22,842 21,434 (2,657) 13,370 16,426 Other 76,174 79,527 63,997 64,617 69,652 ------------------------------------------------------------- Total noninterest income $538,915 $518,063 $459,247 $444,367 $433,303 ============================================================================================================================
NONINTEREST INCOME March 31 December 31 September 30 June 30 March 31 Three months ended - in thousands 1998 1997 1997 1997 1997 - ---------------------------------------------------------------------------------------------------------------------------- Staff expense Compensation $291,091 $286,617 $260,351 $251,274 $250,426 Employee benefits 63,193 35,571 48,141 50,559 58,006 ------------------------------------------------------------- Total staff expense 354,284 322,188 308,492 301,833 308,432 Net occupancy and equipment Net occupancy 48,585 49,813 46,221 46,071 47,240 Equipment 47,224 47,798 44,483 45,710 42,044 ------------------------------------------------------------- Total net occupancy and equipment 95,809 97,611 90,704 91,781 89,284 Amortization Goodwill 13,160 13,143 13,110 13,274 13,268 Mortgage servicing rights 33,105 32,230 24,681 16,556 7,355 Other 10,914 10,731 10,668 9,697 9,208 ------------------------------------------------------------- Total amortization 57,179 56,104 48,459 39,527 29,831 Marketing 37,396 10,742 11,376 25,436 22,841 Distributions on capital securities 13,193 13,123 13,192 9,867 6,956 Other 183,379 215,493 179,932 181,348 187,047 -------------------------------------------------------------- Total noninterest expense $741,240 $715,261 $652,155 $649,792 $644,391 ============================================================================================================================
-more- PNC BANK CORP. AND SUBSIDIARIES Page 9 Consolidated Balance Sheet
March 31 December 31 March 31 Dollars in millions, except par value 1998 1997 1997 - ------------------------------------------------------------------------------------------------------------------------------- ASSETS Cash and due from banks $2,581 $4,303 $3,096 Short-term investments 718 1,526 702 Loans held for sale 2,399 2,324 1,375 Securities available for sale 7,511 8,522 9,593 Loans, net of unearned income of $393, $412 and $387 54,511 54,245 52,575 Allowance for credit losses (912) (972) (1,119) ------------------------------------- Net loans 53,599 53,273 51,456 Other 5,547 5,172 4,944 -------------------------------------- Total assets $72,355 $75,120 $71,166 ------------------------------------- LIABILITIES Deposits Noninterest-bearing $10,117 $10,158 $9,971 Interest-bearing 35,951 37,491 34,931 ------------------------------------- Total deposits 46,068 47,649 44,902 Borrowed funds Bank notes and senior debt 9,503 9,826 8,813 Federal funds purchased 773 3,632 2,937 Repurchase agreements 1,827 714 531 Other borrowed funds 4,591 3,753 4,915 Subordinated debt 1,681 1,697 1,351 ------------------------------------- Total borrowed funds 18,375 19,622 18,547 Other 1,775 1,815 1,889 ------------------------------------- Total liabilities 66,218 69,086 65,338 Mandatorily redeemable capital securities of subsidiary trusts 650 650 350 SHAREHOLDERS' EQUITY Preferred stock 7 7 7 Common stock - $5 par value Authorized 450,000,000 shares Issued 350,353,116; 348,447,600 and 347,037,481 shares 1,752 1,742 1,735 Capital surplus 1,088 1,042 984 Retained earnings 4,788 4,641 4,218 Deferred benefit expense (43) (41) (60) Accumulated other comprehensive income (32) (23) (137) Common stock held in treasury at cost: 49,543,007; 48,017,641 and 33,162,947 shares (2,073) (1,984) (1,269) ------------------------------------- Total shareholders' equity 5,487 5,384 5,478 ------------------------------------- Total liabilities, capital securities and shareholders' equity $72,355 $75,120 $71,166 ===============================================================================================================================
-more- PNC BANK CORP. AND SUBSIDIARIES Page 10 Consolidated Balance Sheet Data
AVERAGE BALANCES March 31 December 31 September 30 June 30 March 31 Three months ended - in millions 1998 1997 1997 1997 1997 - ---------------------------------------------------------------------------------------------------------------------------------- ASSETS Interest-earning assets Securities $7,784 $7,769 $8,216 $9,055 $10,089 Loans, net of unearned income Consumer 11,186 11,108 10,996 11,239 11,827 Credit card 3,748 3,803 3,871 3,502 3,043 Residential mortgage 12,784 12,966 13,503 13,164 12,781 Commercial 20,665 19,838 18,858 18,986 18,429 Commercial real estate 3,624 4,067 4,022 4,038 4,078 Other 2,076 1,881 1,952 1,884 1,764 --------------------------------------------------------- Total loans, net of unearned income 54,083 53,663 53,202 52,813 51,922 Other 3,322 2,655 2,536 2,333 1,814 --------------------------------------------------------- Total interest-earning assets 65,189 64,087 63,954 64,201 63,825 Noninterest-earning assets 6,952 6,782 6,627 6,620 6,476 --------------------------------------------------------- Total assets $72,141 $70,869 $70,581 $70,821 $70,301 ========================================================= LIABILITIES Interest-bearing liabilities Deposits $34,945 $34,655 $34,952 $35,313 $34,533 Borrowed funds 19,989 18,624 18,484 18,675 18,594 --------------------------------------------------------- Total interest-bearing liabilities 54,934 53,279 53,436 53,988 53,127 Noninterest-bearing deposits 9,685 9,925 9,654 9,501 9,600 Other 1,474 1,601 1,460 1,480 1,466 --------------------------------------------------------- Total liabilities 66,093 64,805 64,550 64,969 64,193 Mandatorily redeemable capital securities of subsidiary 650 650 650 492 350 trusts SHAREHOLDERS' EQUITY 5,398 5,414 5,381 5,360 5,758 --------------------------------------------------------- Total liabilities, capital securities and shareholders' equity $72,141 $70,869 $70,581 $70,821 $70,301 ========================================================= COMMON SHAREHOLDERS' EQUITY $5,083 $5,099 $5,066 $5,044 $5,442 =================================================================================================================================
LOAN PORTFOLIO March 31 December 31 September 30 June 30 March 31 Period ended - in millions 1998 1997 1997 1997 1997 - --------------------------------------------------------------------------------------------------------------------------------- Consumer $11,106 $11,205 $11,206 $10,983 $11,356 Credit card 3,729 3,830 3,861 3,693 3,345 Residential mortgage 12,351 12,785 13,064 13,494 13,056 Commercial 21,823 19,989 19,536 19,266 19,020 Commercial real estate 3,467 3,974 4,085 4,003 4,031 Other 2,428 2,874 2,281 2,450 2,154 ------- ------- ------- ------- ------- Total loans 54,904 54,657 54,033 53,889 52,962 Unearned income (393) (412) (382) (392) (387) ------- ------- ------- ------- ------- Total loans, net of unearned income $54,511 $54,245 $53,651 $53,497 $52,575 =================================================================================================================================
-more- PNC BANK CORP. AND SUBSIDIARIES Page 11 Asset Quality Data
ALLOWANCE FOR CREDIT LOSSES March 31 December 31 September 30 June 30 March 31 Three months ended - in millions 1998 1997 1997 1997 1997 - -------------------------------------------------------------------------------------------------------------------------------- Beginning balance $972 $1,027 $1,075 $1,119 $1,166 Charge-offs Consumer (25) (27) (25) (25) (30) Credit card (72) (54) (53) (55) (46) Residential mortgage (2) (1) (3) (3) (2) Commercial (6) (18) (11) (10) (10) Commercial real estate (2) (5) (3) (3) (1) ----------------------------------------------------------------- Total charge-offs (107) (105) (95) (96) (89) Recoveries Consumer 10 10 9 9 9 Credit card 3 5 4 9 7 Residential mortgage 1 Commercial 3 4 7 18 9 Commercial real estate 1 6 2 1 3 ----------------------------------------------------------------- Total recoveries 17 25 22 37 29 ----------------------------------------------------------------- Net charge-offs (90) (80) (73) (59) (60) Provision for credit losses 30 25 20 15 10 Acquisitions 5 3 ----------------------------------------------------------------- Ending balance $912 $972 $1,027 $1,075 $1,119 ================================================================================================================================
NONPERFORMING ASSETS March 31 December 31 September 30 June 30 March 31 Period ended - in millions 1998 1997 1997 1997 1997 - -------------------------------------------------------------------------------------------------------------------------------- Nonaccrual loans Commercial $145 $128 $142 $155 $135 Commercial real estate 81 94 122 139 137 Residential mortgage 51 44 45 46 45 Consumer 7 10 6 5 5 ----------------------------------------------------------------- Total nonaccrual loans 284 276 315 345 322 Restructured loans 2 1 1 ----------------------------------------------------------------- Total nonperforming loans 284 276 317 346 323 Foreclosed assets Commercial real estate 23 27 37 55 66 Residential mortgage 19 21 23 23 24 Other 9 9 17 18 16 ----------------------------------------------------------------- Total foreclosed assets 51 57 77 96 106 ----------------------------------------------------------------- Total nonperforming assets $335 $333 $394 $442 $429 ================================================================================================================================