Pretax pre-provision earnings of $1.7 billion exceeded the provision for credit losses by more than $750 million in the third quarter of 2009.

Total revenue of $4.0 billion for the quarter reflected strong net interest income and noninterest income as PNC’s diverse sources of revenue continued to deliver high quality results. The net interest margin increased 16 basis points linked quarter to 3.76 percent for the third quarter of 2009 primarily due to a substantial reduction in the overall cost of funds.

Expenses remained well controlled and declined $279 million, or 10 percent, compared with the linked quarter.

Capital ratios strengthened as PNC increased the estimated Tier 1 risk-based capital ratio by 30 basis points to 10.8 percent at September 30, 2009 and added 20 basis points to the estimated Tier 1 common equity ratio which was 5.5 percent at September 30, 2009. PNC plans to redeem the preferred shares issued under the TARP Capital Purchase Program when appropriate and in a shareholder-friendly manner, subject to approval by its banking regulators.

PNC continued to maintain a strong liquidity position with an 87 percent loan to deposit ratio at September 30, 2009 combined with significant liquid assets and borrowing capacity. Transaction deposits increased $1 billion during the third quarter, reflecting growth of approximately $3 billion before the impact of the required branch divestitures that included $2 billion of transaction deposits. During the quarter the company continued to manage deposit pricing, reducing nonrelationship certificates of deposit.

Loans declined 3 percent during the quarter to $161 billion reflecting paydowns and reduced demand as customers decreased debt, as well as net charge-offs. PNC remains committed to responsible lending, and loans and commitments of approximately $28 billion were originated and renewed during the third quarter as the company continued to make credit available.

Credit quality deterioration occurred at a slower pace during the third quarter. PNC strengthened loan loss reserves. The provision for credit losses exceeded net charge-offs by $264 million and the ratio of allowance for loan and lease losses to total loans increased to 2.99 percent at September 30, 2009 from 2.77 percent at June 30, 2009. Net charge-offs to average loans were 1.59 percent on an annualized basis for the third quarter down from 1.89 percent for the second quarter of 2009. The allowance for loan and lease losses of $4.8 billion combined with the fair value marks of $6.6 billion on acquired impaired loans represented approximately 7 percent of loans outstanding at September 30, 2009.

Overall the acquisition of National City Corporation continued to exceed expectations.

The transaction was accretive to year-to-date earnings and is expected to be accretive for the full year.

Cost savings of approximately $200 million were realized in the third quarter, an increase of $60 million from the second quarter. This brings cumulative savings to more than $460 million, ahead of plan and on track to exceed the $1.2 billion two-year goal.

The required divestiture of 61 branches including $4.1 billion of deposits and $.8 billion of loans was completed by September 4, 2009.

The first major conversion of National City customers to the PNC platform is scheduled for completion by November 9, 2009, with the remaining conversions to be completed by June 2010.

Consolidation of bank charters is planned for early November 2009.

The combined company is committed to delivering the PNC brand for client and business growth.

PNC’s customer retention efforts were successful and met expectations. The required branch divestitures impacted statistics for net new consumer and business checking relationships, online banking active customers and online bill payment active customers during the third quarter of 2009. Excluding the impact of the required divestitures, checking relationships grew 1 percent and active online banking and online bill payment customers grew 3 percent and 4 percent, respectively, during the quarter.

Average deposit balances declined $3.6 billion from the second quarter due to the planned run off of higher rate certificates of deposit net of successful retention of customer relationships and the impact of branch divestitures. The deposit strategy of Retail Banking is to remain disciplined on pricing while targeting specific products and markets for growth. A continued decline in certificates of deposit is expected for the remainder of 2009 and into 2010.

Average loan balances decreased $371 million compared with the linked quarter as education loan growth was offset by declines in commercial, floor plan, residential mortgage and home equity loans. In the current environment, consumer and commercial loan demand is being outpaced by refinances, paydowns and charge-offs.

Net interest income for the third quarter of 2009 declined $38 million, or 4 percent, compared with the second quarter primarily as a result of declining yields assigned to deposits.

Noninterest income for the quarter increased $5 million, or 1 percent, compared with the linked quarter as a result of higher service charges on deposits.

Noninterest expense for the third quarter declined $25 million, or 2 percent, compared with the second quarter. Expenses were well managed as continued investments in distribution channels were partially offset by reductions in expenses from acquisitions and the required branch divestitures.

Provision for credit losses was $313 million for the third quarter of 2009 compared with $304 million in the second quarter.

Retail Banking had 2,553 branches and an ATM network of 6,463 machines at September 30, 2009 giving PNC one of the largest distribution networks among U.S. banks. During the third quarter of 2009, PNC opened 7 traditional branches and 3 in-store branches, consolidated 2 branches, added 62 ATMs, and divested 61 branches and 73 ATMs.

Net interest income for the third quarter of 2009 was $915 million, an increase of $29 million compared with the second quarter of 2009 primarily due to higher loan spreads during the third quarter.

Corporate service fees were $226 million in the third quarter of 2009 compared with $236 million in the linked quarter. The major components of corporate service fees are treasury management, corporate finance fees and commercial mortgage servicing revenue. The linked quarter decrease was primarily the result of a $16 million recovery in the valuation of commercial mortgage servicing rights in the previous quarter.

Other noninterest income increased $14 million to $175 million in the third quarter of 2009 compared with the second quarter mainly due to higher gains on sales of impaired and unimpaired loans from portfolio management activities.

Noninterest expense was $459 million in the third quarter of 2009 compared with $467 million in the second quarter. The decrease was primarily from lower asset impairment costs.

Provision for credit losses was $426 million in the third quarter of 2009 compared with $649 million in the second quarter of 2009. The provision related primarily to real estate, middle market and transportation related portfolios. Net charge-offs for the third quarter were $222 million, a $100 million decrease compared with the linked quarter. The largest decline in net charge-offs was in the middle market portfolio.

Average loans were $70 billion for the third quarter of 2009 compared with $74 billion in the second quarter of 2009. The decrease was due to lower utilization levels among middle market and large corporate clients and asset-based lending clients who had lower inventory and receivable levels.

Average deposits were $39 billion in the third quarter of 2009, an increase of $3.4 billion, or 9 percent, compared with the second quarter. Continued growth occurred primarily in noninterest-bearing demand and money market deposits, and included seasonal increases related to tax receipts of municipal and school district customers.

The commercial mortgage servicing portfolio was $275 billion at September 30, 2009 compared with $269 billion at June 30, 2009 and $247 billion at September 30, 2008. Continued growth in the agency and conventional servicing portfolios was somewhat offset by a decline in the commercial mortgage-backed securities servicing portfolio.

Assets under management increased to $104 billion at September 30, 2009 compared with $98 billion at June 30, 2009 due to higher equity market values and improvement in net flows. Nondiscretionary assets under administration declined by $11 billion compared with June 30, 2009 due to lower institutional assets related to the exit of a noncore product offering.

Noninterest income for the quarter of $155 million increased $4 million compared with the second quarter of 2009 as asset management fees were positively impacted by the improving equity markets, new business generation and a shift in assets into higher yielding equity investments.

Net interest income for the third quarter of $70 million decreased $5 million compared with the linked quarter due to lower yields assigned to deposits in the declining rate environment and a reduction in higher yield loans.

Noninterest expense declined by $5 million to $162 million for the third quarter compared with the second quarter from continued expense discipline.

Provision for credit losses was $9 million for the third quarter of 2009 compared with $46 million for the second quarter. The lower provision was attributable to consistent reserve levels resulting from stable credit quality and lower net charge-offs.

Average loan balances decreased $120 million, or 2 percent, compared with the linked quarter as declines in commercial loans and residential mortgages were somewhat offset by home equity loan growth. Average deposits for the quarter declined $152 million, or 2 percent, compared with the second quarter due to the elimination of a deposit sweep product and the planned run off of high rate certificates of deposit.

Total loan originations were $3.6 billion for the third quarter compared with $6.4 billion in the linked quarter, reflecting a significant drop in refinancing activity consistent with industry trends. Loans were primarily originated through direct channels under agency (FNMA, FHLMC, FHA/VA) guidelines.

Residential mortgage loans serviced for others totaled $158 billion at September 30, 2009 compared with $161 billion at June 30, 2009. Payoffs slightly exceeded new direct loan origination volume during the quarter.

Noninterest income was $209 million in the third quarter of 2009 compared with $245 million in the second quarter of 2009. The decline was due to lower loan sales revenue which decreased $68 million in the linked quarter comparison primarily driven by a reduction in the mortgage loan pipeline and compressed price margins. Net hedging gains on mortgage servicing rights increased slightly to $60 million in the third quarter. Loan servicing fees increased by $28 million over the previous quarter, benefitting from lower payoff volume.

Net interest income was $83 million in the third quarter of 2009 compared with $87 million in the second quarter.

Noninterest expense was $141 million for the third quarter of 2009, down $35 million or 20 percent compared with the linked quarter. Lower origination volumes contributed to a decline in personnel expense and foreclosure costs decreased from second quarter 2009.

The fair value of mortgage servicing rights was $1.3 billion at September 30, 2009 compared with $1.5 billion at June 30, 2009. The decrease was primarily attributable to a lower fair value of the asset resulting from higher prepayment expectations due to lower interest rates at the end of the third quarter of 2009.

Servicing revenue totaled $200 million and increased slightly over the linked quarter. Higher asset based fees resulting from higher equity markets were offset by lower revenue from client reimbursed expenses. Servicing revenue declined $43 million, or 18 percent, from third quarter 2008 due to lower equity market values, high redemption activity and account closures over the past twelve months.

Operating expense totaled $168 million, a decrease of $2 million, or 1 percent, from the second quarter of 2009 and $19 million, or 10 percent, from the third quarter of 2008. The decreases were largely due to actions taken to reduce costs in response to the market downturn including job and salary actions in certain services and renegotiation of vendor contracts.

Global Investment Servicing provided accounting/administration services for $795 billion of net fund assets and custody services for $427 billion of fund assets as of September 30, 2009 compared with $774 billion and $399 billion, respectively, at June 30, 2009 and $907 billion and $415 billion, respectively, at September 30, 2008. Increases in both categories over the linked quarter reflected the recovering market and client inflows while the decrease in accounting/administration net fund assets serviced in the prior year comparison was due to market levels and the loss of a client.

Total fund assets serviced by Global Investment Servicing were $2.2 trillion at September 30, 2009 compared with asset servicing levels of $2.0 trillion at June 30, 2009 and $2.3 trillion at September 30, 2008.

Net interest income was $235 million for the third quarter of 2009 compared with $295 million for the second quarter primarily due to lower interest on acquired impaired loans.

Noninterest income was $19 million for the third quarter compared with $39 million in the linked quarter. The decrease was mainly due to early termination of certain credit insurance and third party servicing contracts and a reduction in recourse reserves in the second quarter.

Noninterest expense increased $7 million to $62 million for the third quarter of 2009 compared with the second quarter due to higher levels of other real estate owned expenses in the third quarter.

The provision for credit losses of $127 million increased $97 million compared with the linked quarter as a result of an increase in required reserves allocated to this business segment.

Average loans were $20 billion for the third quarter of 2009 compared with $22 billion in the second quarter of 2009. The decline in average loans was primarily driven by scheduled repayments and net charge-offs.

Acquired impaired loans declined to $7.8 billion at September 30, 2009 compared with $8.7 billion at June 30, 2009 primarily as a result of paydowns. This segment contained 71 percent of the company’s acquired impaired loans at quarter end.

Loans in this segment require special servicing and management oversight given current loan performance and market conditions. Consequently, the business activities of this segment are focused on maximizing value within a defined risk profile, including selling assets when the terms and conditions are appropriate.

Our businesses and financial results are affected by business and economic conditions, both generally and specifically in the principal markets in which we operate. In particular, our businesses and financial results may be impacted by:

Changes in interest rates and valuations in the debt, equity and other financial markets.

Disruptions in the liquidity and other functioning of financial markets, including such disruptions in the markets for real estate and other assets commonly securing financial products.

Actions by the Federal Reserve and other government agencies, including those that impact money supply and market interest rates.

Changes in our customers’, suppliers’ and other counterparties’ performance in general and their creditworthiness in particular.

Changes in levels of unemployment.

Changes in customer preferences and behavior, whether as a result of changing business and economic conditions or other factors.

A continuation of recent turbulence in significant portions of the US and global financial markets, particularly if it worsens, could impact our performance, both directly by affecting our revenues and the value of our assets and liabilities and indirectly by affecting our counterparties and the economy generally.

Our business and financial performance could be impacted as the financial industry restructures in the current environment, both by changes in the creditworthiness and performance of our counterparties and by changes in the competitive and regulatory landscape.

Given current economic and financial market conditions, our forward-looking financial statements are subject to the risk that these conditions will be substantially different than we are currently expecting. These statements are based on our current expectations that interest rates will remain low through 2009 with continued wide market credit spreads, and our view that national economic trends currently point to the end of recessionary conditions in the later half of 2009 followed by a subdued recovery in 2010.

Legal and regulatory developments could have an impact on our ability to operate our businesses or our financial condition or results of operations or our competitive position or reputation. Reputational impacts, in turn, could affect matters such as business generation and retention, our ability to attract and retain management, liquidity, and funding. These legal and regulatory developments could include:

Changes resulting from legislative and regulatory responses to the current economic and financial industry environment, including current and future conditions or restrictions imposed as a result of our participation in the TARP Capital Purchase Program.

Other legislative and regulatory reforms, including broad-based restructuring of financial industry regulation as well as changes to laws and regulations involving tax, pension, bankruptcy, consumer protection, and other aspects of the financial institution industry.

Increased litigation risk from recent regulatory and other governmental developments.

Unfavorable resolution of legal proceedings or other claims or regulatory and other governmental inquiries.

The results of the regulatory examination and supervision process, including our failure to satisfy the requirements of agreements with governmental agencies.

Changes in accounting policies and principles.

Our issuance of securities to the US Department of the Treasury may limit our ability to return capital to our shareholders and is dilutive to our common shares. If we are unable previously to redeem the shares, the dividend rate increases substantially after five years.

Our business and operating results are affected by our ability to identify and effectively manage risks inherent in our businesses, including, where appropriate, through the effective use of third-party insurance, derivatives, and capital management techniques, and by our ability to meet evolving regulatory capital standards.

The adequacy of our intellectual property protection, and the extent of any costs associated with obtaining rights in intellectual property claimed by others, can impact our business and operating results.

Our ability to anticipate and respond to technological changes can have an impact on our ability to respond to customer needs and to meet competitive demands.

Our ability to implement our business initiatives and strategies could affect our financial performance over the next several years.

Competition can have an impact on customer acquisition, growth and retention, as well as on our credit spreads and product pricing, which can affect market share, deposits and revenues.

Our business and operating results can also be affected by widespread natural disasters, terrorist activities or international hostilities, either as a result of the impact on the economy and capital and other financial markets generally or on us or on our customers, suppliers or other counterparties specifically.

Also, risks and uncertainties that could affect the results anticipated in forward-looking statements or from historical performance relating to our equity interest in BlackRock, Inc. are discussed in more detail in BlackRock’s filings with the SEC, including in the Risk Factors sections of BlackRock’s reports. BlackRock’s SEC filings are accessible on the SEC’s website and on or through BlackRock’s website at www.blackrock.com. This material is referenced for informational purposes only and should not be deemed to constitute a part of this document.

The anticipated benefits of the transaction, including anticipated cost savings and strategic gains, may be significantly harder or take longer to achieve than expected or may not be achieved in their entirety as a result of unexpected factors or events.

Our ability to achieve anticipated results from this transaction is dependent on the state going forward of the economic and financial markets, which have been under significant stress recently. Specifically, we may incur more credit losses from National City’s loan portfolio than expected. Other issues related to achieving anticipated financial results include the possibility that deposit attrition or attrition in key client, partner and other relationships may be greater than expected.

Legal proceedings or other claims made and governmental investigations currently pending against National City, as well as others that may be filed, made or commenced relating to National City’s business and activities before the acquisition, could adversely impact our financial results.

Our ability to achieve anticipated results is also dependent on our ability to bring National City’s systems, operating models, and controls into conformity with ours and to do so on our planned time schedule. The integration of National City’s business and operations into PNC, which will include conversion of National City’s different systems and procedures, may take longer than anticipated or be more costly than anticipated or have unanticipated adverse results relating to National City’s or PNC’s existing businesses. PNC’s ability to integrate National City successfully may be adversely affected by the fact that this transaction has resulted in PNC entering several markets where PNC did not previously have any meaningful retail presence.

Revenue

Net interest income

Noninterest income

Total revenue

Noninterest expense

Pretax, pre-provision earnings

Provision for credit losses

Net income

Net income attributable to common shareholders

Diluted earnings per common share

Cash dividends declared per common share

Total preferred dividends declared

TARP Capital Purchase Program preferred dividends

Impact of TARP Capital Purchase Program preferred dividends per common share

SELECTED RATIOS

Net interest margin (b)

Noninterest income to total revenue (c)

Efficiency (d)

Return on:

Average common shareholders’ equity

Average assets

BALANCE SHEET DATA

Dollars in millions, except per share data

Assets

Loans

Allowance for loan and lease losses

Interest-earning deposits with banks

Investment securities

Loans held for sale

Goodwill and other intangible assets

Equity investments

Noninterest-bearing deposits

Interest-bearing deposits

Total deposits

Borrowed funds

Shareholders’ equity

Common shareholders’ equity

Accumulated other comprehensive loss

Book value per common share

Common shares outstanding (millions)

Loans to deposits

ASSETS ADMINISTERED (billions)

Managed

Nondiscretionary

FUND ASSETS SERVICED (billions)

Accounting/administration net assets

Custody assets

CAPITAL RATIOS (b)

Tier 1 risk-based

Tier 1 common

Total risk-based

Leverage

ASSET QUALITY RATIOS

Nonperforming loans to total loans

Nonperforming assets to total loans and foreclosed and other assets

Nonperforming assets to total assets

Net charge-offs to average loans (for the three months ended) (annualized)

Allowance for loan and lease losses to total loans

Allowance for loan and lease losses to nonperforming loans

Earnings (Loss)

Retail Banking

Corporate & Institutional Banking

Asset Management Group

Residential Mortgage Banking

Global Investment Servicing

Distressed Assets Portfolio

Other, including BlackRock (b)

Total consolidated net income

Revenue

Retail Banking

Corporate & Institutional Banking

Asset Management Group

Residential Mortgage Banking

Global Investment Servicing

Distressed Assets Portfolio

Other, including BlackRock (b)

Total consolidated revenue