SCHEDULE 14A INFORMATION
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PNC Bank
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(Name of Registrant as Specified In Its Charter)
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Notes:
PNC Bank Corp. Thomas H. O'Brien
One PNC Plaza Chairman and Chief Executive Officer
249 Fifth Avenue
Pittsburgh, PA 15222-2707
PNCBANK
LOGO
March 18, 1999
Dear Shareholder:
You will find enclosed the notice of meeting, proxy statement and proxy card
for the annual meeting of shareholders of PNC Bank Corp., which will be held on
Tuesday, April 27, 1999, on the 15th floor of One PNC Plaza, in Pittsburgh,
Pennsylvania, beginning at 11:00 a.m. Our 1998 Annual Report to Shareholders
accompanies these enclosures.
Please review the enclosed material and complete, sign, date and return the
proxy card regardless of whether you plan to attend the annual meeting, so that
the matters coming before the meeting can be acted upon.
We look forward to meeting our shareholders, and we are particularly happy to
welcome our new friends and colleagues at Hilliard Lyons to the growing family
of PNC Bank shareholders. We appreciate the opportunity to discuss the business
of your company with you.
Cordially,
/s/ Thomas H. O'Brien
Thomas H. O'Brien
PNCBANK
LOGO
PNC Bank Corp.
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
March 18, 1999
Notice of Annual Meeting of Shareholders
APRIL 27, 1999
To The Shareholders:
The annual meeting of the shareholders of PNC Bank Corp. (the "Corporation")
will be held on the 15th floor of One PNC Plaza, 249 Fifth Avenue, Pittsburgh,
Pennsylvania, on Tuesday, April 27, 1999, beginning at 11:00 a.m., local time,
for the purpose of considering and acting upon the following matters:
(1) The election of 17 directors to serve until the next annual meeting and
until their successors are elected and qualified; and
(2) Such other business as may properly come before the meeting or any
adjournment thereof.
Shareholders of record at the close of business on February 26, 1999 (except
for holders of the Corporation's Fixed/Adjustable Rate Noncumulative Preferred
Stock, Series F) are entitled to receive notice of, and to vote at, the meeting
and any adjournment thereof.
A proxy statement, form of proxy and self-addressed envelope are enclosed.
Please complete, date and sign the proxy card. Return it promptly in the
envelope provided, which requires no postage if mailed in the United States. If
you attend the meeting, you may withdraw your proxy and vote in person, if you
so choose.
By Order of the Board of Directors,
/s/ Thomas R. Moore
Thomas R. Moore
Corporate Secretary
PNCBANK
LOGO
PNC Bank Corp.
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
March 18, 1999
Proxy Statement
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
APRIL 27, 1999
The enclosed proxy is being solicited by the Board of Directors ("Board of
Directors" or "Board") of PNC Bank Corp. ("Corporation" or "PNC") for use at
the Corporation's annual meeting of shareholders to be held April 27, 1999, or
at any adjournment thereof ("meeting" or "annual meeting"). Solicitation of
proxies may be made by mail, personal interviews, telephone and facsimile by
officers and employees of the Corporation and its subsidiaries. The
Corporation has retained D. F. King & Co., Inc. to assist in the solicitation
of proxies for a fee of $12,500 plus out-of-pocket expenses. Brokerage houses
and other custodians, nominees and fiduciaries will be requested to forward
soliciting material to the beneficial owners of the stock held of record by
such persons. Expenses for such solicitation will be borne by the Corporation.
The proxy statement and form of proxy are first being mailed to shareholders
on or about March 18, 1999.
The enclosed proxy is revocable at any time prior to the actual voting of
such proxy by the filing of an instrument revoking it, or a duly executed
proxy bearing a later date, with the Corporate Secretary of the Corporation.
In the event your proxy is mailed and you attend the meeting, you may revoke
your proxy and cast your vote personally. All properly executed proxies
delivered pursuant to this solicitation will be voted at the meeting in
accordance with instructions, if any. Unless otherwise directed, proxies will
be voted FOR the election as director of each of the persons named on page 3.
The Board of Directors has fixed the close of business on February 26, 1999
as the record date for determining shareholders entitled to receive notice of
and to vote at the meeting and any adjournment thereof ("Record Date"). On the
Record Date, there were issued and outstanding 302,103,797 shares of the
Corporation's common stock, par value $5.00 per share ("Common Stock"), and
the following shares of the Corporation's preferred stock entitled to vote at
the meeting: 12,862 shares of $1.80 Cumulative Convertible Preferred Stock-
Series A ("Preferred Stock-A"); 4,384 shares of $1.80 Cumulative Convertible
Preferred Stock-Series B ("Preferred Stock-B"); 270,546 shares of $1.60
Cumulative Convertible Preferred Stock-Series C ("Preferred Stock-C"); and
385,730 shares of $1.80 Cumulative Convertible Preferred Stock-Series D
("Preferred Stock-D") (collectively, "Voting Preferred Stock"). As of the
Record Date, there were 6,000,000 shares of Fixed/Adjustable Rate
Noncumulative Preferred Stock, Series F ("Preferred Stock-F") issued and
outstanding. Holders of Preferred Stock-F have no voting rights except in
limited circumstances which are not anticipated to come before the annual
meeting for a vote, and therefore were not entitled to receive notice of the
meeting.
The holders of Common Stock are entitled to one vote per share. Holders of
each share of Voting Preferred Stock are entitled to a number of votes equal
to the number of full shares of Common Stock which can be acquired upon
conversion of such preferred stock, with holders of Preferred Stock-A and
Preferred Stock-B being entitled to 8 votes per share and holders of Preferred
Stock-C and Preferred Stock-D being entitled to 4 votes
1
per 2.4 shares. Holders of record of the Common Stock and Voting Preferred
Stock will vote together as a single class at the meeting, as described in the
section captioned "Voting Procedures" beginning on page 22. The presence in
person or by proxy of the holders of a majority in voting power of the Common
Stock and the Voting Preferred Stock will constitute a quorum for the
transaction of business at the meeting.
The Corporation will provide, without charge to each shareholder upon
written request, a copy (without exhibits, unless otherwise requested) of the
Corporation's Annual Report on Form 10-K required to be filed with the
Securities and Exchange Commission ("SEC") for the year ended December 31,
1998. Requests for copies should be addressed to Lynn F. Evans, Director of
Financial Reporting, PNC Bank Corp., One PNC Plaza, 249 Fifth Avenue,
Pittsburgh, Pennsylvania 15222-2707. Requests may also be directed to (412)
762-1553 or via e-mail to financial.reporting@pncbank.com. Copies may also be
accessed electronically by means of the SEC's home page on the Internet at
www.sec.gov. Neither the Annual Report on Form 10-K nor the 1998 Annual Report
to Shareholders is part of the proxy solicitation materials.
ITEM 1
ELECTION OF DIRECTORS
Information Concerning Nominees
The By-Laws of the Corporation provide that the number of directors shall be
not fewer than five nor more than 36 as from time to time determined by the
Board of Directors. Pursuant to the recommendation of its Committee on
Corporate Governance, the Board has acted to fix at 17 the number of directors
to be elected at the annual meeting. The persons named on page 3 are the
nominees for election as directors, to hold office until the next annual
meeting of shareholders and the election and qualification of their
successors.
The proxies solicited hereby, unless directed to the contrary therein, will
be voted FOR all nominees named below. All such nominees are now directors of
the Corporation. All nominees have consented to being named in this proxy
statement and to serve if elected. The Board of Directors has no reason to
believe that any nominee will be unavailable or unable to serve as a director,
but if for any reason any nominee should not be available or able to serve,
the accompanying proxy will be voted by the persons acting under said proxy in
accordance with the recommendations of the Board of Directors.
The table on page 3 sets forth the names of the nominees for election as
directors of the Corporation; their principal occupations as of January 15,
1999; the year the directors first became directors of the Corporation; and
their directorships of certain other companies. All nominees have held the
position indicated or another senior executive position with the same entity
or one of its affiliates or a predecessor corporation for at least the past
five years.
2
Director
Name Age Principal Occupation Since
- ---- --- -------------------- --------
Paul W. Chellgren 56 Chairman and Chief Executive Officer of Ashland Inc. 1995
(energy company)
Robert N. Clay 52 President and Chief Executive Officer of Clay Holding 1987
Company (investments)
George A. Davidson, Jr. 60 Chairman and Chief Executive Officer of Consolidated 1988
Natural Gas Company (public utility holding company)
David F. Girard-diCarlo 56 Managing Partner of Blank Rome Comisky & McCauley 1995
LLP (law firm)
Walter E. Gregg, Jr. 57 Senior Executive Vice President of the Corporation 1998
William R. Johnson 50 President and Chief Executive Officer of H.J. Heinz 1997
Company (food products company)
Bruce C. Lindsay 57 Chairman and Managing Director of Brind-Lindsay & 1995
Co., Inc. (advisory company)
W. Craig McClelland 64 Chairman and Chief Executive Officer of Union Camp 1985
Corporation (paper manufacturing and land resources)
Thomas H. O'Brien 62 Chairman and Chief Executive Officer of the Corporation 1983
Jane G. Pepper 53 President of Pennsylvania Horticultural Society 1997
(nonprofit horticultural membership organization)
Jackson H. Randolph 68 Chairman of Cinergy Corp. (public utility holding 1988
company)
James E. Rohr 50 President and Chief Operating Officer of the Corporation 1989
Roderic H. Ross 68 Vice Chairman and Chief Executive Officer of Keystone 1979
State Life Insurance Company (insurance company)
Richard P. Simmons 67 Chairman, President and Chief Executive Officer of 1976
Allegheny Teledyne Incorporated (specialty metals
and diversified business)
Thomas J. Usher 56 Chairman and Chief Executive Officer of USX 1992
Corporation (energy, steel and diversified business)
Milton A. Washington 63 President and Chief Executive Officer of Allegheny 1994
Housing Rehabilitation Corporation (housing
rehabilitation and construction)
Helge H. Wehmeier 56 President and Chief Executive Officer of Bayer 1992
Corporation (healthcare, life sciences, and chemicals)
Directorships in Companies
Other than the Corporation
Filing Reports with the
Name SEC
- ---- --------------------------
Paul W. Chellgren Ashland Inc.; Arch Coal, Inc.; and
Medtronic, Inc.
Robert N. Clay None
George A. Davidson, Jr. Consolidated Natural Gas Company;
and B.F. Goodrich Company
David F. Girard-diCarlo None
Walter E. Gregg, Jr. None
William R. Johnson Amerada Hess Corporation;
Cincinnati Financial Corporation;
and H.J. Heinz Company
Bruce C. Lindsay None
W. Craig McClelland Union Camp Corporation; and
Allegheny Teledyne Incorporated
Thomas H. O'Brien Bell Atlantic Corporation; and
Hilb, Rogal and Hamilton Company
Jane G. Pepper None
Jackson H. Randolph Cinergy Corp.; and
Cincinnati Financial Corporation
James E. Rohr Allegheny Teledyne Incorporated;
and Equitable Resources, Inc.
Roderic H. Ross Hunt Corp.; and PMA Capital Corp.
Richard P. Simmons Allegheny Teledyne Incorporated; and
Consolidated Natural Gas Company
Thomas J. Usher USX Corporation; and
PPG Industries, Inc.
Milton A. Washington None
Helge H. Wehmeier None
3
Board and Committees
The Board of Directors has six standing committees: an Audit Committee; a
Committee on Corporate Governance; a Credit Committee; an Executive Committee;
a Finance Committee; and a Personnel and Compensation Committee.
The Audit Committee is responsible for assisting the Board of Directors in
fulfilling its statutory and fiduciary responsibilities for the audit function
of the Corporation and its subsidiaries and in monitoring its accounting and
financial reporting practices; assessing whether the Corporation has adequate
administrative, operational and internal accounting controls and that the
Corporation is operating in accordance with its prescribed procedures and
codes of conduct; determining that the Corporation has in place policies and
procedures to enable it to comply with applicable laws and regulations and
that such compliance is occurring; and providing general oversight for the
internal and external audit function. Its functions include recommending to
the Board of Directors the appointment of the independent auditors and
reviewing with the internal auditors and the independent auditors their annual
audit plans and monitoring their progress during the year. In discharging its
responsibilities, the Committee is entitled to rely upon the reports,
findings, and representations of the Corporation's auditors, legal counsel,
and responsible officers. The Committee is presently composed of Ms. Pepper
and Messrs. Wehmeier (Chairman), Girard-diCarlo, Randolph and Usher.
The Committee on Corporate Governance is responsible for recommending to the
Board of Directors persons to be nominated for election or appointment as
directors of the Corporation and monitoring and recommending enhancements to
the Corporation's corporate governance framework, particularly with respect to
the structure, processes, and proceedings of the Board of Directors. In
performing the nominating function, the Committee may consider director
nominees recommended by shareholders. Such recommendations must be submitted
in writing no later than November 18, 1999 to the Corporate Secretary, PNC
Bank Corp., One PNC Plaza, 249 Fifth Avenue, Pittsburgh, Pennsylvania 15222-
2707, and include the name, age, citizenship, residence, qualifications and
directorships and other positions held by the proposed nominee in business,
charitable, and community organizations. For information on the requirements
governing shareholder nominations for the election of directors to be made at
an annual meeting of shareholders, please see the section captioned
"Shareholder Proposals and Nominations", on page 24. The Committee is
presently composed of Ms. Pepper and Messrs. Davidson (Chairman), Lindsay,
Randolph, Ross, Simmons and Wehmeier.
The Credit Committee is responsible for reviewing and approving (when
appropriate) loan policies and reports of compliance therewith; reviewing
credit policy committee activities; and reviewing reports regarding lending
and credit activities, as well as the Corporation's credit quality. The
Committee is presently composed of Messrs. McClelland (Chairman), Davidson,
Girard-diCarlo, Rohr, Ross and Washington.
The Executive Committee has all the powers of the Board of Directors to the
extent permitted by law and can exercise such powers between meetings of the
Board of Directors. The Committee is presently composed of Messrs. Simmons
(Chairman), Chellgren, Davidson, Gregg, McClelland, O'Brien, Rohr, Usher and
Wehmeier.
The Finance Committee is primarily responsible for monitoring the
Corporation's interest rate and liquidity risks. In performing this function,
the Committee reviews and approves (when appropriate) key asset and liability
policies regarding interest rate sensitivity, financial derivatives and
funding needs and reviews management reports regarding these policies and
activities related thereto. The Committee's responsibilities also include
oversight of the Corporation's capital management activities and trading
activities, including related market risk management policies and risk limits.
The Committee is presently composed of Messrs. Chellgren (Chairman), Clay,
Gregg, Johnson, Lindsay, O'Brien and Simmons.
The Personnel and Compensation Committee is responsible for recommending to
the Board of Directors the persons to be elected as Chairman, President, and
Vice Chairmen of the Corporation and establishing the compensation of the
executive officers of the Corporation. The Committee also makes
recommendations to
4
the Board of Directors regarding the adoption of employee benefit, bonus,
incentive compensation or similar plans and is responsible for their oversight
or administration. The Committee is presently composed of Messrs. Usher
(Chairman), Chellgren, Clay, Johnson, McClelland and Washington.
The Board of Directors met eight times during 1998. During 1998, the Board's
committees held the following number of meetings: Audit Committee--three
meetings; Committee on Corporate Governance--two meetings; Credit Committee--
four meetings; Executive Committee--three meetings; Finance Committee--five
meetings; and Personnel and Compensation Committee--four meetings.
In 1998, each director then serving attended at least 75% of the combined
total of meetings of the Board of Directors and each committee of the Board on
which such director served.
Compensation of Directors
Executive officers of the Corporation who are directors or members of
committees of the Board of Directors of the Corporation or its subsidiaries
receive no compensation for serving in such positions. All non-officer
directors of the Corporation are compensated for their services by a per diem
fee of $1,200 for any day's participation in a Board or committee meeting, or
any combination thereof, an annual retainer fee of $37,000 for Board
membership and, in accordance with the terms of the Corporation's 1992
Director Share Incentive Plan ("Director Share Plan"), a number of shares of
Common Stock having a fair market value on the date of the award equal to
$5,000. In addition, the chairman of each standing committee receives a $5,000
annual retainer fee. For 1998, the Corporation did not pay more than $64,950
in aggregate fees, including the value of Common Stock awarded pursuant to the
Director Share Plan, to any one director.
Under the terms of the Directors Deferred Compensation Plan, non-officer
directors may elect to defer the receipt of all or a portion of the
compensation otherwise payable to them as a result of their service as a
director. The minimum deferral amount is $10,000 per year. A director may
elect one of two investment options with respect to amounts deferred: an
interest rate alternative or an investment in phantom shares of Common Stock.
Investment elections may be changed quarterly. A director may also elect the
event or date when amounts credited to his or her account are paid out and
whether the payout shall be in a lump sum or a designated number of annual
installments (not to exceed ten annual installments). The director may
designate a beneficiary to receive unpaid amounts in the account upon the
director's death.
As an additional form of deferred compensation, each current or future non-
officer director of the Corporation who served as a director of the
Corporation or a predecessor or acquired entity for at least five years will
be paid an annual cash benefit following his or her separation from the Board.
The amount of the annual benefit will be equal to the annual retainer fee in
effect for non-officer directors of the Corporation on the date of the
director's separation from service. The annual benefit will be paid for the
lesser of ten years or the life of the director, with payment to commence on
the later of age 65 or separation from the Board of Directors.
Common Stock Purchase Guideline
In 1995, upon the recommendation of the Committee on Corporate Governance,
the Board of Directors adopted a Common Stock purchase guideline which
requires that each non-officer director annually purchase Common Stock in an
amount equal to twenty-five percent of the annual retainer fee then in effect.
During 1998, each director complied with this guideline.
5
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information concerning beneficial ownership
of the Corporation's Common Stock as of January 15, 1999, by each director and
nominee for election as a director, each of the five executive officers named
in the Summary Compensation Table on page 15 and all directors and executive
officers of the Corporation as a group. The number of shares shown as
beneficially owned by each director and executive officer is determined under
the rules of the SEC and the information is not necessarily indicative of
beneficial ownership for any other purpose. For purposes of the table set
forth below, beneficial ownership includes any shares as to which the
individual has sole or shared voting power or investment power and also any
shares which the individual has the right to acquire within 60 days of January
15, 1999 through the exercise of any option, warrant or right.
Security Ownership of Directors and Executive Officers
Amount and Nature
Name of Beneficial Ownership
- ---- -----------------------
Paul W. Chellgren 9,330
Robert N. Clay 7,257
George A. Davidson, Jr. 9,360
David F. Girard-diCarlo 2,443
Walter E. Gregg, Jr. 210,433(/1/)(/2/)
Joseph C. Guyaux 107,007(/1/)(/2/)
William R. Johnson 1,517
Bruce C. Lindsay 3,747
W. Craig McClelland 4,780
Thomas H. O'Brien 895,925(/1/)(/2/)(/3/)
Jane G. Pepper 1,550
Jackson H. Randolph 11,803
Bruce E. Robbins 142,002(/1/)(/2/)
James E. Rohr 533,778(/1/)(/2/)(/3/)
Roderic H. Ross 6,552
Richard P. Simmons 86,869
Thomas J. Usher 5,309
Milton A. Washington 19,138
Helge H. Wehmeier 5,465
Directors and executive officers as a group (26 persons)* 2,736,333(/1/)(/2/)(/3/)
- --------
* As of January 15, 1999, there were 303,765,538 shares of the Corporation's
Common Stock issued and outstanding. The number of shares of Common Stock
held by each individual is less than 1% of the outstanding shares of Common
Stock; the total number of shares of Common Stock held by the group is also
less than 1% of the class. These percentages were calculated by adding
shares subject to employee stock options to the foregoing number, if the
options were either exercisable as of January 15, 1999 or exercisable within
60 days of that date. The number shown also includes 242,438 restricted
shares of Common Stock held by the 12 executive officers. The number of
restricted shares held by each executive officer named in the Summary
Compensation Table on page 15 is shown in footnote (e) to that table. Based
on copies of SEC filings provided to the Corporation, no person is known by
the Corporation to own beneficially more than 5% of its Common Stock.
6
(1) Includes shares held in the Corporation's Incentive Savings Plan, a
qualified employee benefit defined contribution plan.
(2) Includes shares subject to employee stock options held by the executive
officers and either exercisable as of January 15, 1999, or exercisable
within 60 days of that date. The shares subject to such options are as
follows, for Messrs. O'Brien (378,868 shares), Rohr (387,163 shares), Gregg
(151,800 shares), Guyaux (85,345 shares) and Robbins (114,100 shares). The
aggregate number of shares subject to such options for the remaining seven
executive officers is 466,045.
(3) Includes shares held jointly and/or indirectly.
7
COMPENSATION OF EXECUTIVE OFFICERS
Personnel and Compensation Committee Report
The following is the Personnel and Compensation Committee's report to
shareholders on the Corporation's executive compensation policies with respect
to compensation reported for fiscal year 1998. In accordance with the rules of
the SEC, this report shall not be incorporated by reference into any of the
Corporation's filings made under the Securities Exchange Act of 1934 or under
the Securities Act of 1933.
Personnel and Compensation Committee Report on Executive Compensation for
Fiscal Year 1998
Key compensation-related responsibilities of the Personnel and Compensation
Committee ("Committee") of the Board of Directors ("Board"):
. Oversee PNC Bank Corp.'s ("Corporation") employee benefit and
compensation plans, policies and practices;
. Recommend to the Board the adoption or amendment of employee benefit and
compensation plans;
. Conduct regular, comprehensive reviews of the Corporation's executive
compensation program; and
. Establish the annual compensation of the Corporation's executive
officers.
How the Committee functions:
. No Committee member can be a current or former Corporation officer.
. The Committee uses comparative compensation data for the financial
services industry and key management positions obtained from nationally-
recognized compensation consulting firms.
. The compensation data covers a peer group of selected bank holding
companies which compete in markets served by the Corporation ("Peer
Group"). The banking institutions included in the Peer Group do not
necessarily include the same banking institutions included in the peer
group index used for the Common Stock performance graph on page 22.
. The Committee is assisted by:
. An independent compensation consultant retained by the Committee; and
. The Corporation's internal support staffs.
The Corporation's executive compensation program is designed to:
. Attract, motivate and retain executive officers who can make significant
contributions to the Corporation's long-term success;
. Align the interests of executive officers with those of shareholders; and
. Place a significant proportion of an executive officer's total
compensation at risk by tying it to the Corporation's financial and
Common Stock price performance.
8
Description of the three primary components of the Corporation's executive
compensation program: base salary; annual incentive awards; and long-term
incentive awards:
Base salary
. Base salaries are generally targeted at the middle of the competitive
marketplace.
. The "market rate" for an executive position is determined through an
annual formal assessment by the Corporation's human resources
personnel. This assessment considers relevant industry salary
practices, the position's complexity and level of responsibility, its
importance to the Corporation in relation to other executive positions
and the competitiveness of an executive's total compensation.
. Specific compensation data obtained from Peer Group proxy statements
is referenced in establishing the salaries of the Corporation's Chief
Executive Officer and President and Chief Operating Officer,
respectively.
. Subject to the Committee's approval, the level of an executive
officer's base pay is determined on the basis of:
. Relevant comparative compensation data; and
. The Chief Executive Officer's assessment of the executive's
performance, experience, demonstrated leadership, job knowledge and
management skills.
Annual incentive awards
. For 1998, annual incentive awards were made under two plans. For the
Chief Executive Officer and the other four executive officers included
in the compensation tables beginning on page 15 ("named executive
officers"), awards were paid under the 1996 Executive Incentive Award
Plan ("1996 Plan"), which was approved by shareholders at the
Corporation's 1996 annual meeting. With respect to other eligible
executive officers, awards were paid under the shareholder-approved
1994 Annual Incentive Award Plan ("1994 Plan"). Participants in the
1996 Plan do not also receive an award under the 1994 Plan.
. These cash awards are intended to provide a linkage among executive
performance, annual objective performance measures, and long-term
shareholder value.
How annual incentive awards are calculated under the 1996 Plan:
. The 1996 Plan is designed to give the Committee the flexibility to
make annual incentive awards that are comparable to those found in the
marketplace in which the Corporation competes for executive talent.
The 1996 Plan permits the payment of annual incentive awards that are
intended to qualify as deductible, performance-based compensation
under Section 162(m) of the Internal Revenue Code of 1986, as amended
("Code").
. Before the end of the first quarter of 1998, the Committee assigned
each participant an incentive award amount, expressed as the maximum
percentage of the compensation pool available to that participant for
the 1998 award period. For 1998, the compensation pool was equal to
one-half of one percent of the Corporation's 1998 consolidated pre-tax
net income.
. No participant can be assigned a percentage of the compensation pool
greater than 35% and the sum of all percentages assigned cannot exceed
100% of the compensation pool.
9
During the first quarter of 1999, the Committee:
. Confirmed the identity of the executive officers eligible to
participate in the 1996 Plan;
. Computed and certified in writing the size of the compensation pool
for the 1998 award period, based upon financial information supplied
by the Corporation's officers; and
. Certified in writing the amount of the authorized incentive award to
be paid to each participant, based on:
. the maximum percentage of the compensation pool assigned to a
participant during the first quarter of 1998; and
. such qualitative or quantitative performance factors the Committee
deemed relevant in adjusting the incentive award payable to the
level shown in the Summary Compensation Table on page 15, in the
column captioned "Bonus($)," for the year 1998.
How annual incentive awards are calculated under the 1994 Plan:
. The target amount payable to an executive officer as an annual
incentive award under the 1994 Plan is based on an analysis of
competitive pay practices in the Peer Group and is expressed as a
percentage of base salary.
. When setting the 1998 target annual incentive awards, the Committee
assumed that the 1998 target performance goal would be achieved.
Achievement of that goal would result in the payment of approximately
median total cash compensation.
. There are five factors which can affect the size of actual award
payments:
. "EPS Goal"--This goal is based on the Corporation's earnings per
share in relation to the Corporation's budget. The EPS Goal is used
as the primary performance measure when making annual incentive
awards. Management established, subject to Committee approval, the
target EPS Goal for 1998.
. "Relative Goals"--These goals are based on the Corporation's
return on average assets and return on average common shareholders'
equity relative to the Peer Group.
. Business financial performance relative to that Business's budget.
. The Chief Executive Officer's assessment of an executive officer's
performance is also considered.
. The Committee may, in its sole discretion, increase, reduce or
eliminate an executive officer's award, based on an assessment of
the officer's performance.
Long-term incentive awards
. The 1998 stock option grants were made under the shareholder-approved
1997 Long-Term Incentive Award Plan ("Long-Term Plan").
. The Long-Term Plan is intended to focus the efforts of executive
officers on performance that will increase the equity value of the
Corporation for its shareholders.
. The Committee may grant incentive stock options and nonstatutory stock
options to purchase shares of Common Stock. The options are granted at
an exercise price per share not less than the fair market value of a
share of Common Stock on the date of grant. The Committee may also
grant stock appreciation rights, performance units, and incentive or
restricted stock. For 1998, nonstatutory stock options and Incentive
Shares were granted, and restricted shares of Common Stock were issued
to selected executive officers. More details about the 1998 grants of
Incentive Shares and the issuance of restricted shares of Common Stock
are provided in the other highlights section of this report.
10
How the number of stock options granted under the Long-Term Plan is
determined:
. A number of stock options is established which would position the
executive officer competitively relative to the Peer Group with
respect to long-term compensation. This number is called the "base-
line amount" and is used as a reference point for upward and downward
adjustments to the stock option grant level. The base-line amount is
adjusted periodically in order to achieve the market competitive
objective.
. Each year, the stock option grant level may be adjusted upward or
downward from the base-line amount. This adjustment is based on the
Corporation's total shareholder return as compared to the Peer Group.
. If the Corporation's total shareholder return is significantly higher
or lower than the Peer Group's median return, the number of options to
be granted will be adjusted above or below, respectively, the base-
line amount.
. Total shareholder return is based on Common Stock appreciation and
dividend payments for the three most recent years. For example, the
1998 grants were based on Common Stock appreciation and dividend
payments for the period 1995 through 1997. No adjustment was made to
the base-line amount for the 1998 grants.
Chief Executive Officer compensation
. With input from the Committee's independent compensation consultant, the
Committee discusses matters affecting Mr. O'Brien's compensation
privately, without Mr. O'Brien or other officers present.
. The Committee considered:
. The Corporation's financial performance and Peer Group compensation
data; and
. Mr. O'Brien's leadership, decision-making skills, experience,
knowledge, communication with the Board and strategic recommendations,
as well as the Corporation's positioning for future performance.
. The Committee did not place any particular relative weight on one of
these factors over another, but the Corporation's financial
performance is generally given the most weight.
. The Committee's decisions regarding Mr. O'Brien's compensation are
reported to and discussed by the full Board at its next regularly
scheduled meeting. These discussions are conducted privately, without Mr.
O'Brien or other officers present.
. For 1998, the Committee's decisions regarding Mr. O'Brien's compensation
included the following:
. In December 1997, the Committee decided that Mr. O'Brien's 1998 base
salary would be maintained at the level established for 1997.
. In February 1998, the Committee granted Mr. O'Brien 132,000
nonstatutory stock options, using the total shareholder return
methodology described in this report. These options have an exercise
price per share of $54.7188, the average of the high and low sale
prices of a share of Common Stock on the date of grant.
. In October 1998, the Committee granted Mr. O'Brien 118,000
nonstatutory stock options with a premium exercise price per share of
$66.00. These options are referred to as "premium-priced" because the
$66.00 exercise price is above the average of the high and low sale
prices of a share of Common Stock on the date of grant, or $43.66. The
Committee made this option grant, together with a second grant of
82,000 premium-priced options with an exercise price of $76.00 per
share in January 1999, to Mr. O'Brien in lieu of a 1998 Incentive
Share Award made under the Long-Term Plan to certain of the
Corporation's other executive officers and discussed in more detail in
the other highlights section of this report and the table on page 19.
The Committee considered various alternatives when deliberating on Mr.
O'Brien's long-term incentive compensation. The Committee concluded
that the grant of premium-priced stock options was more appropriate,
in terms of performance characteristics, than the award of incentive
shares at this point in Mr. O'Brien's career.
11
. In February 1999, in accordance with the methodology used for calculating
annual incentive awards under the 1996 Plan, the Committee authorized the
payment to Mr. O'Brien of $2,565,000 as an incentive award for 1998.
. In deciding upon the size of Mr. O'Brien's 1998 incentive award payment,
the Committee considered these significant accomplishments, in addition
to the Corporation's EPS Goal and Relative Goals achievements, for 1998:
. Earnings for 1998 were a record $1.115 billion, compared with $1.052
billion in 1997.
. On a per share basis, earnings rose 10% to $3.60 per diluted share
from $3.28 in 1997.
. Revenue increased by 19%, compared with 1997 results.
. Noninterest income grew $768 million for the year, driven by a 32%
increase in fee-based revenue, led by asset management, mutual fund
servicing, consumer services, corporate services and mortgage banking.
. The ratio of noninterest income to total revenue continued to grow,
increasing to 55% for the fourth quarter of 1998 and 50% for full year
1998, compared with 42% in 1997.
. Significant acquisitions, such as Hilliard-Lyons, Inc. and Midland
Loan Services, L.P., were completed and other significant investments
were made in businesses positioned for superior growth.
. Strategic actions, such as the sale of the corporate trust and escrow
business and the pending sale of the Corporation's credit card
business, were taken to redeploy capital to higher-performing
businesses and strengthen the Corporation's risk profile.
Tax policy
. Section 162(m) of the Code disallows a federal income tax deduction for
compensation over $1 million paid to the Chief Executive Officer and any of
the executive officers included in the compensation tables following this
report, subject to certain exceptions.
. One exception applies to compensation paid pursuant to shareholder-approved
plans that are performance-based.
. The Committee intends that awards made under the 1996 Plan and the Long-
Term Plan be eligible for the performance-based exception, and therefore
eligible as a federal income tax deduction for the Corporation.
. The Committee has taken and will continue to take actions necessary to
minimize the Corporation's nondeductible compensation expense under Section
162(m). While keeping this goal in mind, the Committee also will try to
maintain the flexibility which the Committee believes to be an important
element of the Corporation's executive compensation program.
Other highlights of compensation-related developments since the Committee's
previous report:
. As disclosed in last year's Committee report and the accompanying award
table, during 1997 a small number of key executive officers, including each
of the named executive officers, received incentive share awards. A
specified number of restricted shares of Common Stock were to be issued to
each award recipient upon the achievement of performance conditions based
on the per share price of Common Stock and two specified financial
performance goals. During 1998, the Committee certified in writing that the
share price performance goal of $57.00 and both financial performance
conditions had been satisfied. As a result, restricted shares of Common
Stock were issued on April 7, 1998 in the name of Messrs. O'Brien (81,000
shares), Rohr (41,625 shares), Gregg (30,375 shares), Guyaux (13,500
shares), Robbins (11,250 shares) and other executive officers who had been
granted awards. Not all of the Incentive Shares shown in the award table in
last year's proxy statement were issued as restricted stock, due to certain
peer group-related
12
performance goals which were not fully achieved. Although the recipients are
entitled to receive dividends on and vote the shares issued, the shares will
be forfeited if the officer leaves the Corporation's employ (except in
certain cases involving the officer's death, total disability or retirement)
within two years after the issuance of the restricted stock. This two-year
restricted period may be eliminated upon certain employment terminations in
the event of a change in control.
. In July 1998, the Committee granted Incentive Shares of Common Stock to a
select group of senior officers pursuant to the Long-Term Plan. The actual
issuance of restricted shares of Common Stock is conditioned upon the
satisfaction of specified Common Stock share price and financial
performance goals on or before June 30, 2001.
Each of the named executive officers, except Mr. O'Brien, received grants
of Incentive Shares. As explained earlier in this report, Mr. O'Brien
received, in two installments, a premium-priced option grant in lieu of a
1998 Incentive Share Award. Information on the Incentive Share grants is
included in the table captioned "1997 Long-Term Incentive Award Plan--
Grants in 1998" on page 19. The footnotes to the table provide more
information about the performance goals and the grant conditions.
The Committee believes that these Incentive Shares further align the
interests of senior executives with those of the Corporation's
shareholders, tie a significant proportion of their total compensation to
the achievement of appropriate share price and financial performance goals,
and help to maintain the Corporation's long-term incentive compensation at
competitive levels.
Conclusion:
. Based upon its review of the Corporation's executive compensation program,
the Committee has concluded that the program's basic structure is
appropriate, competitive and effective to serve the purposes for which it
was established.
MEMBERS OF THE COMMITTEE:
Thomas J. Usher (Chairman)
Paul W. Chellgren
Robert N. Clay
William R. Johnson
W. Craig McClelland
Milton A. Washington
13
Compensation Committee Interlocks and Insider Participation
No member of the Personnel and Compensation Committee is an officer or former
officer of the Corporation or any of its subsidiaries.
Certain directors, nominees and executive officers and/or their associates,
including certain members of the Personnel and Compensation Committee and their
respective associates, were customers of and had transactions with the
Corporation or its subsidiaries during 1998. Transactions which involved loans
or commitments by subsidiary banks were made in the ordinary course of business
and on substantially the same terms, including interest rates and collateral,
as those prevailing at the time for comparable transactions with other persons
and did not involve more than normal risk of collectibility or present other
unfavorable features. Blank Rome Comisky & McCauley, the law firm for which Mr.
Girard-diCarlo serves as Managing Partner, was retained to provide legal
services to one or more of the Corporation's subsidiaries during 1998 and may
provide similar services during 1999.
Change in Control and Other Arrangements
The Corporation has entered into change in control severance agreements with
each of the executive officers named in the Summary Compensation Table, and
certain other executive officers. If the executive officer's employment is
terminated by the Corporation without cause, or by the executive officer for
good reason, during a period of up to three years (two years for certain
executive officers) following a change in control of the Corporation, the
executive officer will receive severance benefits, including (i) a lump sum
payment of up to three times (two times for certain executive officers) the
executive officer's annual base salary and bonus; (ii) the payment of at least
the target bonus for the executive officer for the fiscal year during which the
executive officer's employment is terminated; (iii) up to three years (two
years for certain executive officers) of additional benefits under the
Corporation's retirement and benefit plans; and (iv) a payment to reimburse the
executive officer for any excise taxes on severance benefits that are
considered excess parachute payments under the Internal Revenue Code of 1986,
as amended ("Code"). Each agreement requires the executive officer not to use
or disclose any of the Corporation's confidential business information and, if
the executive officer receives the above severance benefits, not to employ or
solicit any officer of the Corporation during the year following the executive
officer's termination. Each agreement terminates when the executive officer
reaches age 65, and the Corporation may, upon one year's advance notice,
simultaneously terminate all of the change in control severance agreements.
The Corporation's displaced employee assistance plans for employees generally
provide an increase in severance benefits following a change in control under
certain circumstances. If an employee's employment is terminated by the
Corporation within two years following consummation of a change in control, the
employee will receive a lump sum payment equal to twice the benefits to which
such employee otherwise would be entitled under the applicable plan.
14
Summary Compensation Table*
The Summary Compensation Table shows, for the years 1996 through 1998, the
compensation paid or awarded to Mr. O'Brien, the Corporation's Chairman and
Chief Executive Officer, and the Corporation's next four most highly
compensated, policy-making executive officers; the inclusion of the four
executive officers other than Mr. O'Brien in this group was based on salary
and bonus earned during 1998. Mr. O'Brien and the other four executive
officers are referred to collectively as the Corporation's "named executive
officers." For a detailed discussion of the Corporation's executive
compensation program, please refer to the Personnel and Compensation Committee
Report on Executive Compensation beginning on page 8.
Annual Compensation Long-Term Compensation
-------------------------------- ----------------------------------
Awards Payouts
---------- --------------
Other Securities
Annual Underlying Long-Term All
Name and Principal Comp Options/ Incentive Plan Other
Position Year Salary ($) Bonus ($) ($) SARS (#) Payouts ($) Comp ($)
- ------------------ ---- ---------- --------- ------ ---------- -------------- --------
(a) (b) (c) (d)(e)
Thomas H. O'Brien 1998 950,000 2,565,000 3,594 364,868 3,281,238 205,362
Chairman and Chief
Executive Officer 1997 950,000 2,000,000 3,411 132,000 0 206,089
PNC Bank Corp. 1996 950,000 1,150,000 2,476 132,000 0 204,230
James E. Rohr 1998 717,308 1,174,500 3,928 135,114 2,079,589 154,137
President and Chief
Operating Officer 1997 675,000 877,500 3,387 71,500 0 152,533
PNC Bank Corp. 1996 650,000 700,000 3,387 71,500 0 161,174
Walter E. Gregg, Jr. 1998 552,308 831,600 1,260 53,400 1,564,596 112,476
Senior Executive Vice
President 1997 510,000 596,700 1,260 53,400 0 106,147
Finance and
Administration 1996 460,000 345,000 1,181 53,400 0 119,526
PNC Bank Corp.
Joseph C. Guyaux 1998 296,923 341,000 1,602 32,135 0 25,277
Executive Vice President
and 1997 **
Chief Executive Officer,
PNC Regional Community
Bank 1996 **
PNC Bank Corp.
Bruce E. Robbins 1998 352,000 281,600 1,006 29,200 873,035 122,575
Executive Vice President
and 1997 352,000 295,680 972 29,200 0 116,474
Chief Executive Officer,
PNC Secured Finance 1996 335,000 167,500 928 29,200 0 108,796
PNC Bank Corp.
- ----
*Footnotes to the Summary Compensation Table are set forth on page 16.
**Mr. Guyaux was not an executive officer of the Corporation during 1996 or
1997 for purposes of the SEC's executive compensation disclosure rules.
15
Footnotes to Summary Compensation Table
(a) The amounts shown represent reimbursement for certain tax liabilities.
None of the named executive officers received perquisites or other
personal benefits, securities or property during 1998 which, in the
aggregate, cost the Corporation the lesser of $50,000 or 10% of the named
executive officer's salary and bonus earned during that year. Perquisites
and other personal benefits which were received by the named executive
officers were valued on the basis of their incremental cost to the
Corporation and its subsidiaries, as prescribed by the rules of the SEC.
(b) With respect to Messrs. O'Brien, Rohr, and Guyaux, the number shown in
this column includes both shares of Common Stock underlying nonstatutory
stock options granted by the Personnel and Compensation Committee in its
discretion during 1998 and shares underlying reload options automatically
granted upon the officer's exercise of options granted on February 19,
1997. The number of shares of Common Stock underlying reload options are
shown in parentheses for Messrs. O'Brien (114,868); Rohr (63,614); and
Guyaux (5,135). For more information about reload options, please see the
"Individual Option Grants--1998" table on page 17 and the relevant
footnotes.
(c) The dollar amounts shown in this column represent the aggregate value of
restricted shares of Common Stock issued to the named executive officer in
1996 upon the achievement of performance conditions based on the per share
price of Common Stock and which vested in two equal installments on
September 17 and November 4, 1998 upon the termination of a two-year
vesting period. The restricted shares were issued pursuant to incentive
share awards granted in 1995 to each of the named executive officers
except Mr. Guyaux. The aggregate dollar amount shown was calculated by
multiplying one half of the total number of restricted shares held by the
named executive officer by $47.0625 and multiplying one half of the number
of such shares by $51.0313, the average of the high and low sale prices of
a share of the Corporation's Common Stock on the September 17, 1998 and
November 4, 1998 vesting dates, respectively, and adding the products of
those computations together. The total number of such shares held by each
named executive officer was as follows: Messrs. O'Brien (66,900); Rohr
(42,400); Gregg (31,900); Guyaux (0); and Robbins (17,800).
(d) The amount shown for each named executive officer for 1998 includes the
dollar value ($9,600) of matching contributions of the Corporation's
Common Stock made pursuant to the Corporation's Incentive Savings Plan, a
qualified employee benefit defined contribution plan. The amount also
includes 1998 contributions made to the Corporation's Supplemental
Incentive Savings Plan, a non-qualified employee benefit defined
contribution plan, for Messrs. O'Brien ($47,400), Rohr ($33,439), Gregg
($23,539), Guyaux ($8,215), and Robbins ($11,520). Finally, the amount
shown includes the 1998 net premiums paid by the Corporation in connection
with its Key Executive Equity Plan, a split-dollar insurance arrangement,
on behalf of Messrs. O'Brien ($148,362), Rohr ($111,098), Gregg ($79,337),
Guyaux ($7,462), and Robbins ($101,455). The net premiums disclosed in the
preceding sentence, and included in "All Other Compensation" for 1996 and
1997, represent the full dollar amounts paid by the Corporation for both
the term and non-term portions of the Key Executive Equity Plan.
(e) As of December 31, 1998, the named executive officers held restricted
shares of Common Stock as follows, with the aggregate dollar value shown
as of that date: Messrs. O'Brien (81,000 shares; $4,379,063); Rohr (41,625
shares; $2,250,352); Gregg (30,375 shares; $1,642,148); Guyaux (13,500
shares; $729,844); and Robbins (11,250 shares; $608,203). The per share
dollar amount used to calculate these values is $54.0625, the average of
the high and low sale prices of a share of the Corporation's Common Stock
on the New York Stock Exchange on December 31, 1998.
16
Option Grants in 1998
This table provides information on stock options granted to the named
executive officers in 1998. Only nonstatutory stock options were granted in
1998 under the Corporation's 1997 Long-Term Incentive Award Plan.
The table provides information about two categories of options granted
during 1998: (i) options granted to each of the named executive officers in
the discretion of the Personnel and Compensation Committee; and (ii) reload
options automatically granted to Messrs. O'Brien, Rohr, and Guyaux upon their
exercise, in the required manner, of options granted to them by the Personnel
and Compensation Committee on February 19, 1997. Reload options included in
the following table are marked with the symbol "(R)." Information about the
nature and purposes of reload options is included in footnote (b); where
appropriate, other footnotes provide additional information which is specific
to the reload options shown in the table.
Individual Option Grants--1998
Number of % of Total
Securities Options
Underlying Granted to Grant Date
Options Employees Exercise or Base Expiration Present
Name Granted (#) in 1998 Price ($/Sh) Date Value ($)
- ---- ----------- ---------- ---------------- ---------- ----------
(a)(b) (c) (d) (e)
Thomas H. O'Brien 132,000 3.83% 54.7188 02/19/2008 1,182,065
Thomas H. O'Brien 114,868(R) 3.33% 54.7188 02/19/2007 1,028,647
Thomas H. O'Brien 118,000 3.42% 66.0000 10/01/2008 302,334
James E. Rohr 71,500 2.07% 54.7188 02/19/2008 640,285
James E. Rohr 40,163(R) 1.16% 54.7188 02/19/2007 359,661
James E. Rohr 23,451(R) 0.68% 52.2188 02/19/2007 196,624
Walter E. Gregg, Jr. 53,400 1.55% 54.7188 02/19/2008 478,199
Joseph C. Guyaux 27,000 0.78% 54.7188 02/19/2008 241,786
Joseph C. Guyaux 2,345(R) 0.07% 54.0938 02/19/2007 20,837
Joseph C. Guyaux 2,790(R) 0.08% 48.8125 02/19/2007 21,282
Bruce E. Robbins 29,200 0.85% 54.7188 02/19/2008 261,487
- --------
(a) All options granted by the Personnel and Compensation Committee have a
grant date of February 19, 1998, except for the Committee's grant of
118,000 premium-priced options to Mr. O'Brien on October 1, 1998. The
options granted on February 19, 1998 became exercisable on February 19,
1999; the options granted to Mr. O'Brien on October 1, 1998 will become
exercisable on April 1, 1999.
The reload options shown were automatically granted on the exercise date(s)
of the named executive officers' February 19, 1997 options, which became
exercisable on February 19, 1998. The grant dates for the reload options
are as follows: (i) Mr. O'Brien's 114,868 reload options were granted on
February 19, 1998; (ii) Mr. Rohr's 40,163 reload options were granted on
February 19, 1998 and his 23,451 reload options were granted on October 21,
1998; and (iii) Mr. Guyaux's 2,345 reload options were granted on February
24, 1998 and his 2,790 reload options were granted on September 16, 1998.
All reload options become exercisable one year after their grant date.
(b) Nonstatutory stock options with a "reload" feature were first granted to a
select group of senior officers by the Personnel and Compensation
Committee on February 19, 1997. All options granted to the named executive
officers and selected other senior officers by the Committee during 1998
also have a reload feature, except for the options granted to Mr. O'Brien
on October 1, 1998. If options with a reload feature are exercised using
Common Stock which has been held for at least six months, the options
exercised are automatically replaced or "reloaded" with a new, at-the-
market option for each share of Common Stock used to satisfy the exercise
price and meet any associated tax withholding obligation. Options can be
reloaded only once, so that the reload options shown in the table cannot
be replaced when they are exercised. The reload option will have the same
remaining term as the option that was exercised.
17
The reload option feature encourages Common Stock ownership by senior
executives because it reduces the potential disadvantage of the early
exercise of stock options. Reload options also reinforce the importance of
Common Stock ownership by the Corporation's senior executives and permit
the Corporation to provide an enhanced benefit to option grantees with no
accounting expense.
(c) The exercise price shown equals the average of the high and low sale
prices of the Corporation's Common Stock on the New York Stock Exchange on
the date of the grant, except for the premium-priced options granted to
Mr. O'Brien on October 1, 1998. The $66.00 exercise price for those
options is above the exercise price which would have otherwise applied to
options granted on that date, or $43.66.
(d) The date shown in this column is the applicable ten-year expiration date,
but an option may expire prior to that date under certain circumstances
specified in the governing nonstatutory stock option agreement, such as
death, retirement, disability or termination of employment.
The expiration date shown for reload options coincides with the expiration
date of the option exercised, regardless of the reload option's grant date.
In other words, a reload option received upon the exercise of an option
granted on February 19, 1997 would have the same ten-year expiration date
of February 19, 2007 applicable to the original option, regardless of the
date on which the reload option was granted.
(e) The dollar values listed in this column are based upon the Black-Scholes
option pricing model.
Except for the 118,000 premium-priced options granted to Mr. O'Brien, the
options granted in 1998 to the named executive officers in the discretion
of the Personnel and Compensation Committee [i.e., the options shown in the
table which are not marked by the symbol "(R)"] and to certain other
executive officers include a reload feature. Those options were valued
without regard to the reload feature. The grant of a reload option is
treated for purposes of this table as the automatic grant of a new option,
the value of which is determined on its own terms as of its grant date.
Additional information about reload options is contained in footnote (b).
The chart below shows, by option grant date, the assumptions used to
determine the grant date present value per option. The Corporation in no
way intends to provide any predictions or assurances with respect to option
or Common Stock values, as some of the underlying assumptions are highly
subjective. The grant dates for specific options listed in the Individual
Option Grants table are disclosed in footnote (a).
Annualized Estimated Dollar
Grant Market Exercise Risk Free Useful Dividend Value Of
Date Price Price Volatility Rate of Return Life Yield Option
----- ------ -------- ---------- -------------- --------- -------- --------
02/19/98 $54.72 $54.72 0.198 5.57% 6 Years 4.40% $8.96
02/24/98 $54.09 $54.09 0.198 5.60% 6 Years 4.40% $8.89
09/16/98 $48.81 $48.81 0.206 4.85% 6 Years 4.40% $7.63
10/01/98 $43.66 $66.00 0.217 4.32% 6 Years 4.40% $2.56
10/21/98 $52.22 $52.22 0.217 4.62% 6 Years 4.40% $8.38
18
Aggregated Option Exercises in 1998 and 1998 Year-End Option Values
This table provides information concerning exercises of nonstatutory stock
options during 1998 by the named executive officers. The table also shows the
number and value of unexercised options, including any reload options held by
the named executive officer, at the end of 1998.
Number of Securities
Underlying Unexercised Value of Unexercised
Options at 1998 In-the-Money Options
Year-End (#) at 1998 Year-End (a)
------------------------- -------------------------
Shares
Acquired on Value
Name Exercise (#) Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- ------------ ---------- ----------- ------------- ----------- -------------
(b) (b)
Thomas H. O'Brien 385,000 $7,872,889 132,000 364,868 $3,027,750 $ 0
James E. Rohr 71,500 718,406 275,500 135,114 7,314,156 43,236
Walter E. Gregg, Jr. 52,400 1,328,640 98,400 53,400 1,582,875 0
Joseph C. Guyaux 5,600 42,081 56,000 32,135 1,241,900 14,647
Bruce E. Robbins 26,500 857,937 84,900 29,200 1,827,181 0
- --------
(a) An option is in-the-money if the fair market value of the underlying
security exceeds the exercise price of the option.
(b) The dollar values shown were calculated by determining the difference
between: (i) the average of the high and low sale prices of the
Corporation's Common Stock on the New York Stock Exchange on December 31,
1998 (i.e., $54.0625); and (ii) the exercise prices of the various options
held by the named executive officer as of December 31, 1998. The value of
an option is deemed to be "$0" if its exercise price is greater than
$54.0625.
1997 Long-Term Incentive Award Plan--Grants in 1998
This table provides information on the incentive shares granted to each of
the named executive officers, except Mr. O'Brien, in 1998 under the
Corporation's 1997 Long-Term Incentive Award Plan. As discussed in the
Personnel and Compensation Committee Report on Executive Compensation, Mr.
O'Brien received a premium-priced option grant in lieu of a 1998 Incentive
Share Award. For a discussion of these grants, please see page 13.
Performance or Other Period Until
Name Number of Incentive Shares(#)(a) Maturation or Payout
- ---- -------------------------------- ---------------------------------
Thomas H. O'Brien 0 N/A
James E. Rohr 50,000 (b)
Walter E. Gregg, Jr. 33,500 (b)
Joseph C. Guyaux 14,000 (b)
Bruce E. Robbins 13,000 (b)
- --------
(a) The actual issuance of shares of Common Stock will occur only upon the
achievement of the share price and/or financial performance goals
specified in the Incentive Share Agreement between the Corporation and the
grantee.
(b) A grantee may receive no shares of Common Stock or up to 200% of the
incentive shares shown in the table, depending upon the achievement of
specified Common Stock price and Corporation financial performance goals
relative to a peer group of bank holding companies. The peer group used
for this purpose is not the same as the peer group index used for purposes
of the Common Stock performance graph on page 22.
The performance period for these grants began on July 1, 1998 and extends
through June 30, 2001; the period's termination date may be extended for no
more than twenty business days under limited circumstances. If the
Corporation's average Common Stock price reaches $87.00 per share over
twenty
19
consecutive business days during the performance period, the grantee will
become eligible to receive 100% of the incentive shares shown in the table.
The number of shares of Common Stock actually issued, however, may be
increased or decreased by up to 50%, depending on the Corporation's return
on average common shareholders' equity and shareholder return performance
levels in relation to the peer group. The Corporation's performance is
determined to be at premium, median, or below median levels relative to the
peer group by reference to a schedule adopted by the Personnel and
Compensation Committee at the time the grants were approved.
If the Corporation's average Common Stock price reaches $100.00 per share
over twenty consecutive business days during the performance period, the
grantee will become eligible to receive additional incentive shares equal
to 50% of the number shown in the table.
If the $87.00 per share price performance goal is not achieved during the
performance period, the Personnel and Compensation Committee will
nevertheless have the authority to direct the issuance to the grantee of
50% of the incentive shares shown in the table if the Corporation has
achieved both return on average common shareholders' equity and relative
shareholder return premium performance levels in relation to the peer
group. If only one of these premium performance levels is achieved but the
other performance goal is at the median level relative to the peer group,
the Committee will have the authority to direct the issuance of 25% of the
incentive shares.
Notwithstanding the foregoing description, the Personnel and Compensation
Committee will have the authority to exercise negative discretion with
respect to each grant and direct that the Corporation not issue part or all
of the incentive shares otherwise issuable, in light of such Corporation or
individual performance factors as the Committee may deem appropriate.
If the grantee's employment with the Corporation terminates prior to the
end of a two-year restricted period following the issuance of shares of
Common Stock, he or she will forfeit all shares awarded, except in certain
cases involving the grantee's death, total disability, or retirement or
certain change in control events. During the restricted period, the grantee
will have the right to vote the awarded shares and receive dividends on
them, but may not sell or otherwise transfer the shares.
Pension Benefits
The Corporation maintains a non-contributory pension plan ("Pension Plan" or
"Plan") for employees. The Plan is a defined benefit pension plan under the
Employee Retirement Income Security Act of 1974, as amended and is qualified
under Section 401(a) of the Code. The Corporation and certain of its
subsidiaries contribute an actuarially determined amount necessary to fund the
total benefits payable to participants employed by them. The amount of the
Corporation's annual contribution with respect to a specific participant
cannot be readily calculated by the actuaries for the Pension Plan.
Benefits under the Plan are determined as follows: Effective January 1,
1999, a recordkeeping "account" was established for each participant. The
initial account balance was determined as the present value of each
participant's accrued benefit as of December 31, 1998, using the Plan
provisions in effect on December 31, 1998. For each calendar quarter after
January 1, 1999, eligible participants receive contribution credits, expressed
as a percentage of Covered Earnings, in accordance with a schedule based on
the participant's age plus years of credited service. In addition, employees
who were at least age 40 and had at least 10 years of service as of January 1,
1999 will receive additional quarterly "Transitional Credits" for up to 10
years.
"Covered Earnings" is defined as an employee's regular earnings plus
eligible paid bonuses; deferred bonus payments are applied to the
Corporation's Supplemental Pension Plan, discussed below. Eligible bonuses for
employees are limited to the greater of $25,000 or 50% of the employee's total
eligible bonuses for the calendar year.
Participants also receive quarterly interest credits at the prevailing 30-
year U.S. Treasury Bond rate. The benefit provided to participants in the
Pension Plan as of December 31, 1998 was no less than the benefit they had
accrued as of December 31, 1998, under the Plan rules in effect as of that
date.
20
The Corporation also maintains two supplemental non-qualified pension plans.
The Supplemental Pension Plan provides retirement benefits equal to the
difference, if any, between the maximum benefit allowed under the Code and the
amount that would be provided by the Pension Plan if no limits were applied.
The Supplemental Pension Plan also recognizes deferred bonuses that were not
included in the Pension Plan as Covered Earnings.
The Corporation also maintains a separate supplemental benefit plan
applicable to certain officers of the Corporation and its subsidiaries.
Officers who were age 50 and had five years of vesting service as of January
1, 1999 receive benefits based on the formula in effect prior to January 1,
1999. All other officers participating in this plan will receive a benefit
based upon the cash balance formula described above, applied to the bonuses
that are recognized for contribution purposes.
The estimated total annual benefits (including those payable by both
supplemental non-qualified pension plans) payable upon retirement at the
normal retirement age of 65 for each of the named executive officers are as
follows: Messrs. O'Brien ($2,164,365); Rohr ($1,597,861); Gregg ($859,320);
Guyaux ($641,565); and Robbins ($529,074). The amounts shown are based on the
payment method which would result in the highest annual benefit, if selected
by the named executive officer. The benefits have been projected assuming
that: (a) each named executive officer's salary remains constant until
retirement; and (b) the 30-year U.S. Treasury Bond rate until retirement is
7.0%.
21
COMMON STOCK PERFORMANCE GRAPH
The graph set forth below shows the cumulative total shareholder return
(i.e., price change plus reinvestment of dividends) on the Corporation's
Common Stock during the five-year period ended December 31, 1998, as compared
with: (i) an overall stock market index, the S&P 500 Index; and (ii) a peer
group index, the S&P Major Regional Banks Index ("S&P Banks"). The stock
performance graph assumes that $100 was invested on January 1, 1994, for the
five-year period and also shows the resultant compound annual growth rate
("CGR") for the performance period. The yearly points marked on the horizontal
axis of the graph correspond to December 31 of that year.
[GRAPH APPEARS HERE]
5 Year
CGR
PNC $100 $ 76.43 $123.38 $150.61 $235.90 $230.39 18.2%
S&P 500 Index 100 101.32 139.40 171.40 228.59 293.91 24.1
S&P Banks 100 94.65 149.03 203.63 306.20 338.30 27.6
Assumes $100 investment on January 1, 1994
Total Return = Price change plus reinvestment of dividends
In accordance with the rules of the SEC, this section shall not be
incorporated by reference into any of the Corporation's filings under the
Securities Exchange Act of 1934 or the Securities Act of 1933.
VOTING PROCEDURES
Pennsylvania law and the Corporation's By-Laws require the presence of a
quorum for the annual meeting. A quorum is constituted by the presence, in
person or by proxy, of shareholders entitled to cast at least a majority of
the votes which all shareholders are entitled to cast on the particular
matters to be voted on. At a duly organized annual meeting, the Corporation's
By-Laws provide that, except as otherwise specified in the Corporation's
Articles of Incorporation or provided by law, each matter shall be decided by
a majority of the votes cast on such matters by the shareholders present at
the meeting in person or by proxy. Votes withheld from director nominees and
abstentions will be counted in determining whether a quorum has been reached,
but the failure to execute and return a proxy will result in a shareholder not
being considered present at the meeting.
Assuming a quorum has been reached, a determination must be made as to the
results of the vote on Item 1, the election of directors.
22
Under Pennsylvania law, the act of "voting" does not include either
recording the fact of abstention or failing to vote for a candidate or for
approval or disapproval of a proposal, whether or not the person entitled to
vote characterizes the conduct as voting. In other words, only those who
indicate an affirmative or negative decision on a matter are treated as
voting, so that ordinarily abstention or a mere absence or failure to vote is
not equivalent to a negative decision.
With respect to Item 1, the 17 nominees for election as directors who
receive the greatest number of votes cast at the annual meeting, assuming that
a quorum is present, shall be elected as directors at the conclusion of the
vote tabulation. A withheld vote on any nominee will not affect the voting
results.
Under the rules of the New York Stock Exchange, "routine" items are those
upon which broker-dealers holding shares in street name for their customers
may vote, in their discretion, on behalf of any customers who do not furnish
voting instructions within ten days of the annual meeting. With respect to
non-routine items that come before the annual meeting for a vote, such broker-
dealers would not be able to vote without first receiving voting instructions
from their customers. These broker "non-votes" would not be considered in the
calculation of the majority of the votes cast and therefore would have no
effect on the vote with respect to a non-routine item.
The Corporation has adopted a policy that all proxies, ballots, voting
instructions from employee benefit plan participants and voting tabulations
that identify the particular vote of a shareholder or benefit plan participant
be kept permanently confidential and not be disclosed to the Corporation, its
directors, officers or employees except: (i) as necessary to meet legal
requirements or to pursue or defend legal actions; (ii) to allow the Judge of
Election to certify the results of the vote; (iii) when expressly requested by
a shareholder or benefit plan participant; or (iv) in the event of a contested
proxy solicitation. The Corporation has confirmed with its independent vote
tabulator and Judge of Election that its procedures will be consistent with
the foregoing policy.
INDEPENDENT AUDITORS
At its meeting on February 18, 1999, the Board of Directors approved the
recommendation of the Audit Committee for the appointment of Ernst & Young LLP
to audit the consolidated financial statements of the Corporation for 1999.
Ernst & Young LLP performed audit services for the Corporation during 1998.
Such services included an audit of annual consolidated financial statements,
interim reviews of quarterly financial statements, review and consultation
connected with filings with the SEC, internal control reviews required by
regulatory authorities and certain contractual agreements, consultation on
tax, financial accounting and reporting matters and meetings with the Audit
Committee of the Board of Directors.
Representatives of Ernst & Young LLP are expected to be present at the
annual meeting with the opportunity to make a statement if they desire to do
so and to be available to respond to appropriate questions.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's directors, certain of its executive officers, and persons who
own more than ten percent of a registered class of the Corporation's equity
securities (currently there are no such shareholders), to file with the
Corporation, the SEC and the New York Stock Exchange initial reports of
ownership and reports of changes in ownership of any equity securities of the
Corporation. With respect to 1998, to the best of the Corporation's knowledge,
all required report forms were filed on a timely basis. In making these
statements, the Corporation has relied in part on the written representations
of its directors and certain of its executive officers and copies of the
reports provided to the Corporation.
23
SHAREHOLDER PROPOSALS AND NOMINATIONS
Eligible shareholders may submit proposals to be considered for inclusion in
the Corporation's 2000 proxy materials for the 2000 annual meeting of
shareholders if they do so in accordance with the applicable SEC rules. Any
such proposals must be in writing and received by the Corporate Secretary of
the Corporation no later than November 18, 1999, in order to be considered for
inclusion in the Corporation's 2000 proxy materials.
Director nominations and proposals for action at an annual meeting of
shareholders may be made only: (i) pursuant to the Corporation's notice of
such meeting; (ii) by the presiding officer; (iii) by or at the direction of a
majority of the Board of Directors; or (iv) by one or more shareholders in
accordance with the applicable rules of the SEC and the governing By-Law
provisions.
A shareholder may make a nomination for the election of a director or a
proposal for action at an annual meeting only if written notice is received by
the Corporate Secretary not later than (i) 90 days prior to the annual meeting
(unless a different date for such notice has been stated in the Corporation's
most recent proxy materials distributed to shareholders); or (ii) if the
annual meeting is to be held on a date other than the fourth Tuesday in April,
the close of business on the tenth day following the first public disclosure
of the meeting date. Public disclosure of the date of any annual meeting may
be made in a filing with the SEC, in any notice given to the New York Stock
Exchange or in a news release reported by any national news service.
Each shareholder notice shall include: (i) as to the shareholder giving the
notice and the beneficial owner, if any, on whose behalf the notice is given
(A) the name and address of such shareholder and of such beneficial owner, and
(B) the class and number of shares of the Corporation which are owned of
record and beneficially by such shareholder and such beneficial owner; and
(ii) a representation that the shareholder is a beneficial owner of stock of
the Corporation entitled to vote at such meeting and intends to be present at
the meeting in person or by proxy to make such nomination or proposal.
Each notice of nomination for the election of a director from a shareholder
also shall set forth: (i) the name and address of the person to be nominated;
(ii) a description of all arrangements or understandings between the
shareholder and the nominee and any other person or persons (naming such
person or persons) pursuant to which the nomination is to be made by the
shareholder; (iii) such other information regarding the nominee as would be
required to be included in proxy materials filed under the applicable rules of
the SEC had the nominee been nominated by the Board of Directors; and (iv) the
written consent of the nominee to serve as a director of the Corporation, if
so elected.
For information on how to submit the name of a person to be considered by
the Committee on Corporate Governance for possible nomination as a director,
please see the paragraph discussing the Committee's responsibilities on page
4.
Each notice of a proposal for action at an annual meeting from a shareholder
also shall set forth a brief description of the proposal, the reasons for
making such proposal, and any direct or indirect interest of the shareholder,
or any person on whose behalf the shareholder is acting, in making such
proposal.
The presiding officer of the meeting may refuse to permit any nomination for
the election of a director or proposal to be made at an annual meeting by a
shareholder who has not complied with all of the foregoing procedures.
Questions about these requirements, or notices mandated by them, may be
directed to:
Corporate Secretary
PNC Bank Corp.
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
24
OTHER MATTERS
The Board of Directors knows of no other business to be presented at the
meeting. If, however, any other business should properly come before the
meeting, or any adjournment thereof, it is intended that the proxy will be
voted with respect thereto in accordance with the best judgment of the persons
named in the proxy.
By Order of the Board of Directors,
/s/ Thomas R. Moore
Thomas R. Moore
Corporate Secretary
25
PNC BANK CORP.
This Proxy Is Solicited by the Board of Directors for Use at the
Annual Meeting of Shareholders
April 27, 1999--11:00 AM
Place: One PNC Plaza, Pittsburgh, PA
Thomas H. O'Brien, Walter E. Gregg, Jr. and Thomas R. Moore, and each of them
with full power to act alone and with full power of substitution, are hereby
authorized to represent the shareholder named on the reverse side hereof
("shareholder") at the annual meeting of shareholders of PNC Bank Corp. to be
held on April 27, 1999, or at any adjournment thereof, and to vote, as
indicated on the reverse side hereof, the number of shares of Common Stock
and/or Preferred Stock which the shareholder would be entitled to vote if
personally present at said meeting. The above named individuals, and each of
them with full power to act alone, are further authorized to vote such stock
upon any other business as may properly come before the meeting, or any
adjournment thereof, in accordance with their best judgment.
THIS PROXY MAY BE REVOKED BY GIVING THE SECRETARY OF THE MEETING WRITTEN NOTICE
OF REVOCATION OR A SUBSEQUENTLY DATED PROXY AT ANY TIME BEFORE THE VOTING OF
THE SHARES REPRESENTED BY THIS PROXY, OR BY CASTING A BALLOT AT THE MEETING.
THIS PROXY IS CONTINUED ON THE REVERSE SIDE.
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY.
- --------------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH HERE /\
WILL ATTEND MEETING [ ]
The Board of Directors recommends a vote FOR all
nominees listed in Item 1. All shares will be voted as
instructed below. In the absence of an instruction to
the contrary, all shares will be voted FOR all nominees
listed in Item 1.
FOR ALL WITHHELD
NOMINEES FOR ALL
Item 1--Election of [ ] [ ]
Directors: Ms. Pepper
and Messrs. Chellgren,
Clay, Davidson, Girard-
diCarlo, Gregg, Johnson,
Lindsay, McClelland,
O'Brien, Randolph, Rohr,
Ross, Simmons, Usher,
Washington and Wehmeier
(or any substitute
nominee in case of
unavailability).
[ ] FOR ALL NOMINEES, EXCEPT
AS INDICATED BELOW:
-------------------------
(Write nominee name(s) COMMENTS/ADDRESS [ ]
in the space provided CHANGE Please
above to withhold mark this box
authority.) if you have
written
comments/address
change on the
reverse side.
Signature(s) Date:
------------------------------------------------ -----------
Please sign as name appears hereon. Joint owners should each sign. When
signing on behalf of a corporation or partnership or as attorney, executor,
administrator, trustee or guardian, please give full title as such.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\FOLD AND DETACH PROXY CARD HERE/\
RETURN PROXY CARD IN ENCLOSED ENVELOPE AFTER COMPLETING, SIGNING AND DATING
Admission Ticket
PNC BANK CORP.
1999 Annual Meeting of Shareholders
Tuesday, April 27, 1999
11:00 AM
One PNC Plaza -- 15th Floor
Fifth Avenue and Wood Street
Pittsburgh, Pennsylvania
PLEASE ADMIT Non-Transferable
PNC BANK CORP.
Annual Meeting of Shareholders
April 27, 1999--11:00 AM
Place: One PNC Plaza, Pittsburgh, PA
ISP INSTRUCTION CARD
To: PNC Bank, National Association, Trustee of the non-ESOP portion of the PNC
Bank Corp. Incentive Savings Plan and Trustee of the ESOP portion of the PNC
Bank Corp. Incentive Savings Plan.
The signatory on the reverse side hereof, a Participant having Common Stock
and/or Preferred Stock of PNC Bank Corp. credited to my account, does hereby
direct each Trustee to vote the number of shares indicated hereon at the annual
meeting of shareholders to be held on April 27, 1999, or any adjournment
thereof, as indicated.
THIS CARD IS CONTINUED ON THE REVERSE SIDE. PLEASE SIGN ON THE REVERSE SIDE AND
RETURN PROMPTLY.
- --------------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH HERE/\
WILL ATTEND MEETING [ ]
The Board of Directors recommends a vote FOR all
nominees listed in Item 1. All full and partial shares
of stock credited to your Plan account will be voted as
directed below. In the absence of a direction to the
contrary, all shares (including unallocated shares)
will be voted in the manner required or permitted by
the governing Plan documents.
FOR ALL WITHHELD
NOMINEES FOR ALL
Item 1--Election of [ ] [ ]
Directors: Ms. Pepper
and Messrs. Chellgren,
Clay, Davidson, Girard-
diCarlo, Gregg,
Johnson, Lindsay,
McClelland, O'Brien,
Randolph, Rohr, Ross,
Simmons, Usher,
Washington and Wehmeier
(or any substitute
nominee in case of
unavailability).
[ ] FOR ALL NOMINEES, EXCEPT
AS INDICATED BELOW:
------------------------
(Write nominee name(s) COMMENTS/ADDRESS [ ]
in the space provided CHANGE Please
above to withhold mark this box
authority.) if you have
written
comments/address
change on the
reverse side.
Signature Date:
----------------------------------------------- ------------
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/\FOLD AND DETACH INSTRUCTION CARD HERE/\
RETURN INSTRUCTION CARD IN ENCLOSED
ENVELOPE AFTER COMPLETING, SIGNING AND DATING
Admission Ticket
PNC BANK CORP.
1999 Annual Meeting of Shareholders
Tuesday, April 27, 1999
11:00 AM
One PNC Plaza -- 15th Floor
Fifth Avenue and Wood Street
Pittsburgh, Pennsylvania
PLEASE ADMIT Non-Transferable
PNC BANK CORP.
Annual Meeting of Shareholders
April 27, 1999--11:00 AM
Place: One PNC Plaza, Pittsburgh, PA
RSP INSTRUCTION CARD
To: PNC Bank, National Association, Trustee of the PNC Bank Corp. Retirement
Savings Plan.
The signatory on the reverse side hereof, a Participant having Common Stock of
PNC Bank Corp. credited to my account, does hereby direct the Trustee to vote
the number of shares indicated hereon at the annual meeting of shareholders to
be held on April 27, 1999, or any adjournment thereof, as indicated.
THIS CARD IS CONTINUED ON THE REVERSE SIDE. PLEASE SIGN ON THE REVERSE SIDE AND
RETURN PROMPTLY.
- --------------------------------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS BOX ON REVERSE SIDE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
/\ FOLD AND DETACH HERE /\
WILL ATTEND MEETING [ ]
The Board of Directors recommends a vote FOR all
nominees listed in Item 1. All full and partial shares
of stock credited to your Plan account will be voted as
directed below. In the absence of a direction to the
contrary, all shares (including unallocated shares)
will be voted in the manner required or permitted by
the governing Plan documents.
FOR ALL WITHHELD
NOMINEES FOR ALL
Item 1--Election of [ ] [ ]
Directors: Ms. Pepper
and Messrs. Chellgren,
Clay, Davidson, Girard-
diCarlo, Gregg,
Johnson, Lindsay,
McClelland, O'Brien,
Randolph, Rohr, Ross,
Simmons, Usher,
Washington and Wehmeier
(or any substitute
nominee in case of
unavailability).
[ ] FOR ALL NOMINEES, EXCEPT
AS INDICATED BELOW:
------------------------
(Write nominee name(s) COMMENTS/ADDRESS [ ]
in the space provided CHANGE Please
above to withhold mark this box
authority.) if you have
written
comments/address
change on the
reverse side.
Signature Date:
----------------------------------------------- -------------
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/\FOLD AND DETACH INSTRUCTION CARD HERE/\
RETURN INSTRUCTION CARD IN ENCLOSED ENVELOPE AFTER COMPLETING, SIGNING AND
DATING
Admission Ticket
PNC BANK CORP.
1999 Annual Meeting of Shareholders
Tuesday, April 27, 1999
11:00 AM
One PNC Plaza -- 15th Floor
Fifth Avenue and Wood Street
Pittsburgh, Pennsylvania
PLEASE ADMIT Non-Transferable