EX-99.1

Exhibit 99.1

LOGO

THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

(Unaudited)

THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2016

(UNAUDITED)


	Page
Consolidated Results:

Income Statement		1
Balance Sheet		2
Per Share Related Information		3
Average Balance Sheet		4-5
Details of Net Interest Margin		6
Total and Core Net Interest Income and Net Interest Margin		7
Loans		8
Allowance for Credit Losses		9
Nonperforming Assets		10-11
Accruing Loans Past Due		12


Business Segment Results:

Descriptions			13
Period End Employees			13
Income and Revenue			14
Retail Banking			15
Corporate & Institutional Banking			16
Asset Management Group			17
Residential Mortgage Banking			18
Non-Strategic Assets Portfolio			19

Glossary of Terms			20-24

The information contained in this Financial Supplement is preliminary, unaudited and based on data available on October 14, 2016. We have reclassified certain prior period amounts to be consistent with the current period presentation, which we believe is more meaningful to readers of our consolidated financial statements. This information speaks only as of the particular date or dates included in the schedules. We do not undertake any obligation to, and disclaim any duty to, correct or update any of the information provided in this Financial Supplement. Our future financial performance is subject to risks and uncertainties as described in our United States Securities and Exchange Commission (SEC) filings.

BUSINESS

PNC is one of the largest diversified financial services companies in the United States and is headquartered in Pittsburgh, Pennsylvania. PNC has businesses engaged in retail banking, corporate and institutional banking, asset management and residential mortgage banking, providing many of its products and services nationally, as well as other products and services in PNC’s primary geographic markets located in Pennsylvania, Ohio, New Jersey, Michigan, Illinois, Maryland, Indiana, Florida, North Carolina, Kentucky, Washington, D.C., Delaware, Virginia, Alabama, Georgia, Missouri, Wisconsin and South Carolina. PNC also provides certain products and services internationally.

The PNC Financial Services Group, Inc.

Cross-Reference Index to Third Quarter 2016 Financial Supplement (Unaudited)

Financial Supplement Table Reference


Table	Description	Page
1	Consolidated Income Statement		1
2	Consolidated Balance Sheet		2
3	Per Share Related Information		3
4	Average Consolidated Balance Sheet		4-5
5	Supplemental Average Balance Sheet Information		5
6	Details of Net Interest Margin		6
7	Total and Core Net Interest Income		7
8	Details of Net Interest Margin		7
9	Details of Core Net Interest Margin		7
10	Details of Loans		8
11	Change in Allowance for Loan and Lease Losses		9
12	Nonperforming Assets By Type		10
13	Change in Nonperforming Assets		11
14	Largest Individual Nonperforming Assets at September 30, 2016		11
15	Accruing Loans Past Due 30 To 59 Days		12
16	Accruing Loans Past Due 60 To 89 Days		12
17	Accruing Loans Past Due 90 Days or More		12
18	Period End Employees		13
19	Summary of Business Segment Income and Revenue		14
20	Retail Banking		15
21	Corporate & Institutional Banking		16
22	Asset Management Group		17
23	Residential Mortgage Banking		18
24	Non-Strategic Assets Portfolio		19


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 1

Table 1: Consolidated Income Statement (Unaudited)


	Three months ended															Nine months ended
In millions, except per share data	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Interest Income
Loans	$	1,856		$	1,829		$	1,843		$	1,806		$	1,804		$	5,528		$	5,397
Investment securities		451			456			462			443			423			1,369			1,236
Other		101			99			102			109			114			302			332

Total interest income		2,408			2,384			2,407			2,358			2,341			7,199			6,965

Interest Expense
Deposits		107			104			105			106			107			316			297
Borrowed funds		206			212			204			160			172			622			482

Total interest expense		313			316			309			266			279			938			779

Net interest income		2,095			2,068			2,098			2,092			2,062			6,261			6,186

Noninterest Income
Asset management		404			377			341			399			376			1,122			1,168
Consumer services		348			354			337			349			341			1,039			986
Corporate services		389			403			325			394			384			1,117			1,097
Residential mortgage		160			165			100			113			125			425			453
Service charges on deposits		174			163			158			170			172			495			481
Net gains (losses) on sales of securities		7			4			9			2			(9	)		20			41
Other		252			260			297			334			324			809			960

Total noninterest income		1,734			1,726			1,567			1,761			1,713			5,027			5,186

Total revenue		3,829			3,794			3,665			3,853			3,775			11,288			11,372
Provision For Credit Losses		87			127			152			74			81			366			181
Noninterest Expense
Personnel		1,239			1,226			1,145			1,252			1,222			3,610			3,579
Occupancy		215			215			221			208			209			651			634
Equipment		246			240			234			245			227			720			680
Marketing		72			61			54			56			64			187			193
Other		622			618			627			635			630			1,867			1,981

Total noninterest expense		2,394			2,360			2,281			2,396			2,352			7,035			7,067

Income before income taxes and noncontrolling interests		1,348			1,307			1,232			1,383			1,342			3,887			4,124
Income taxes		342			318			289			361			269			949			1,003

Net income		1,006			989			943			1,022			1,073			2,938			3,121

Less: Net income (loss) attributable to noncontrolling interests		18			23			19			14			18			60			23
Preferred stock dividends and discount accretion and redemptions (a)		64			43			65			43			64			172			182

Net income attributable to common shareholders	$	924		$	923		$	859		$	965		$	991		$	2,706		$	2,916

Earnings Per Common Share
Basic	$	1.87		$	1.84		$	1.70		$	1.90		$	1.93		$	5.41		$	5.64
Diluted	$	1.84		$	1.82		$	1.68		$	1.87		$	1.90		$	5.33		$	5.52

Average Common Shares Outstanding
Basic		490			497			501			506			512			496			516
Diluted		496			503			507			513			520			502			525

Efficiency		63	%		62	%		62	%		62	%		62	%		62	%		62	%
Noninterest income to total revenue		45	%		45	%		43	%		46	%		45	%		45	%		46	%
Effective tax rate (b)		25.4	%		24.3	%		23.5	%		26.1	%		20.0	%		24.4	%		24.3	%

(a)	Dividends are payable quarterly other than Series O and Series R preferred stock, which are payable semiannually in different quarters.

(b)	The effective income tax rates are generally lower than the statutory rate due to the relationship of pretax income to tax credits and earnings that are not subject to tax.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 2

Table 2: Consolidated Balance Sheet (Unaudited)


In millions, except par value	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015
Assets
Cash and due from banks (a)	$	4,531		$	4,196		$	3,861		$	4,065		$	3,835
Federal funds sold and resale agreements (b)		718			1,476			1,123			1,369			1,534
Trading securities		2,612			2,006			1,884			1,726			1,901
Interest-earning deposits with banks (a) (c)		27,058			26,750			29,478			30,546			34,224
Loans held for sale (b)		2,053			2,296			1,541			1,540			2,060
Investment securities		78,514			71,801			72,569			70,528			68,066
Loans (b)		210,446			209,056			207,485			206,696			204,983
Allowance for loan and lease losses		(2,619	)		(2,685	)		(2,711	)		(2,727	)		(3,237	)

Net loans (a)		207,827			206,371			204,774			203,969			201,746
Goodwill		9,103			9,103			9,103			9,103			9,103
Mortgage servicing rights		1,293			1,222			1,323			1,589			1,467
Other intangible assets		304			329			353			379			407
Equity investments (a) (d)		10,605			10,469			10,391			10,587			10,497
Other (a) (b)		24,730			25,316			24,585			23,092			27,285

Total assets	$	369,348		$	361,335		$	360,985		$	358,493		$	362,125

Liabilities
Deposits
Noninterest-bearing	$	82,159		$	77,866		$	78,151		$	79,435		$	78,239
Interest-bearing		177,736			171,912			172,208			169,567			166,740

Total deposits		259,895			249,778			250,359			249,002			244,979
Borrowed funds
Federal funds purchased and repurchase agreements		1,235			1,620			2,495			1,777			2,077
Federal Home Loan Bank borrowings		17,050			18,055			19,058			20,108			21,664
Bank notes and senior debt		22,431			23,588			21,594			21,298			19,749
Subordinated debt		8,708			8,764			8,707			8,556			9,242
Other (a) (b)		2,117			2,544			2,324			2,793			3,931

Total borrowed funds		51,541			54,571			54,178			54,532			56,663
Allowance for unfunded loan commitments and letters of credit		310			303			282			261			266
Accrued expenses (a)		5,226			5,080			4,850			4,975			5,185
Other (a)		5,531			4,904			4,988			3,743			8,754

Total liabilities		322,503			314,636			314,657			312,513			315,847

Equity
Preferred stock (e)
Common stock - $5 par value
Authorized 800 shares, issued 542 shares		2,709			2,709			2,708			2,708			2,708
Capital surplus - preferred stock		3,456			3,455			3,453			3,452			3,450
Capital surplus - common stock and other		12,703			12,653			12,586			12,745			12,675
Retained earnings		30,958			30,309			29,642			29,043			28,337
Accumulated other comprehensive income (loss)		646			736			532			130			615
Common stock held in treasury at cost: 54, 49, 43, 38 and 32 shares		(4,765	)		(4,304	)		(3,791	)		(3,368	)		(2,837	)

Total shareholders’ equity		45,707			45,558			45,130			44,710			44,948
Noncontrolling interests		1,138			1,141			1,198			1,270			1,330

Total equity		46,845			46,699			46,328			45,980			46,278

Total liabilities and equity	$	369,348		$	361,335		$	360,985		$	358,493		$	362,125

(a)	Amounts include consolidated variable interest entities. Our second quarter 2016 Form 10-Q included, and our third quarter 2016 Form 10-Q will include, additional information regarding these items.

(b)	Amounts include assets and liabilities for which PNC has elected the fair value option. Our second quarter 2016 Form 10-Q included, and our third quarter 2016 Form 10-Q will include, additional information regarding these items.

(c)	Amounts include balances held with the Federal Reserve Bank of Cleveland of $26.6 billion, $26.3 billion, $29.0 billion, $30.0 billion, and $33.8 billion as of September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015, and September 30, 2015, respectively.

(d)	Amounts include our equity interest in BlackRock.

(e)	Par value less than $.5 million at each date.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 3

Table 3: Per Share Related Information (Unaudited)


	Three months ended										Nine months ended
In millions, except per share data	September 30 2016		June 30 2016		March 31 2016		December 31 2015		September 30 2015		September 30 2016		September 30 2015
Basic
Net income	$	1,006	$	989	$	943	$	1,022	$	1,073	$	2,938	$	3,121
Less:
Net income (loss) attributable to noncontrolling interests		18		23		19		14		18		60		23
Preferred stock dividends and discount accretion and redemptions (a)		64		43		65		43		64		172		182

Net income attributable to common shareholders		924		923		859		965		991		2,706		2,916
Less:
Dividends and undistributed earnings allocated to nonvested restricted shares		7		6		6		4		—		19		2

Net income attributable to basic common shares	$	917	$	917	$	853	$	961	$	991	$	2,687	$	2,914
Basic weighted-average common shares outstanding		490		497		501		506		512		496		516
Basic earnings per common share	$	1.87	$	1.84	$	1.70	$	1.90	$	1.93	$	5.41	$	5.64
Diluted
Net income attributable to basic common shares	$	917	$	917	$	853	$	961	$	991	$	2,687	$	2,914
Less: Impact of BlackRock earnings per share dilution		4		3		3		4		4		10		14

Net income attributable to diluted common shares	$	913	$	914	$	850	$	957	$	987	$	2,677	$	2,900
Basic weighted-average common shares outstanding		490		497		501		506		512		496		516
Dilutive potential common shares		6		6		6		7		8		6		9

Diluted weighted-average common shares outstanding		496		503		507		513		520		502		525
Diluted earnings per common share	$	1.84	$	1.82	$	1.68	$	1.87	$	1.90	$	5.33	$	5.52

(a)	Dividends are payable quarterly other than Series O and Series R preferred stock, which are payable semiannually in different quarters.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 4

Table 4: Average Consolidated Balance Sheet (Unaudited) (a)


	Three months ended															Nine months ended
In millions	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Assets
Interest-earning assets:
Investment securities
Securities available for sale
Residential mortgage-backed
Agency	$	25,825		$	24,856		$	24,696		$	23,777		$	21,813		$	25,129		$	20,560
Non-agency		3,490			3,728			3,936			4,089			4,279			3,717			4,471
Commercial mortgage-backed		6,276			6,335			6,586			6,709			6,228			6,399			6,258
Asset-backed		5,823			5,672			5,486			5,280			5,287			5,661			5,219
U.S. Treasury and government agencies		9,929			9,673			9,936			8,996			6,558			9,846			5,640
Other		5,166			5,004			4,847			4,611			4,374			5,006			4,253

Total securities available for sale		56,509			55,268			55,487			53,462			48,539			55,758			46,401
Securities held to maturity
Residential mortgage-backed		10,521			10,215			9,906			9,345			8,352			10,215			7,865
Commercial mortgage-backed		1,666			1,755			1,821			1,878			1,927			1,747			2,009
Asset-backed		702			708			715			723			733			708			744
U.S. Treasury and government agencies		264			262			259			257			254			262			252
Other		1,983			1,986			2,081			2,193			2,268			2,016			2,307

Total securities held to maturity		15,136			14,926			14,782			14,396			13,534			14,948			13,177

Total investment securities		71,645			70,194			70,269			67,858			62,073			70,706			59,578
Loans
Commercial		100,320			99,991			99,068			98,212			97,926			99,795			98,053
Commercial real estate		29,034			28,659			27,967			26,714			25,228			28,555			24,659
Equipment lease financing		7,463			7,570			7,420			7,501			7,683			7,485			7,593
Consumer		57,163			57,467			58,212			59,108			59,584			57,612			60,426
Residential real estate		14,870			14,643			14,517			14,486			14,406			14,677			14,391

Total loans		208,850			208,330			207,184			206,021			204,827			208,124			205,122
Interest-earning deposits with banks		28,063			26,463			25,533			31,509			37,289			26,691			33,380
Loans held for sale		2,044			1,655			1,509			1,897			2,048			1,737			2,128
Federal funds sold and resale agreements		1,056			1,026			1,299			1,469			1,598			1,127			1,737
Other		5,074			4,768			4,956			5,109			5,033			4,933			5,183

Total interest-earning assets		316,732			312,436			310,750			313,863			312,868			313,318			307,128
Noninterest-earning assets:
Allowance for loan and lease losses		(2,675	)		(2,712	)		(2,711	)		(3,204	)		(3,265	)		(2,699	)		(3,297	)
Cash and due from banks		4,128			3,938			3,919			4,115			3,890			3,996			3,969
Other		45,685			45,328			43,955			45,622			45,094			44,992			45,333

Total assets	$	363,870		$	358,990		$	355,913		$	360,396		$	358,587		$	359,607		$	353,133

(a)	Calculated using average daily balances.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 5

Table 4: Average Consolidated Balance Sheet (Unaudited) (Continued) (a)


	Three months ended										Nine months ended
In millions	September 30 2016		June 30 2016		March 31 2016		December 31 2015		September 30 2015		September 30 2016		September 30 2015
Liabilities and Equity
Interest-bearing liabilities:
Interest-bearing deposits
Money market	$	70,076	$	72,442	$	76,392	$	81,199	$	84,554	$	72,960	$	82,151
Demand		53,428		52,218		49,770		47,778		46,390		51,854		46,269
Savings		31,791		28,131		23,343		17,851		14,150		27,770		13,663
Retail certificates of deposit		17,153		17,277		17,278		17,916		18,392		17,236		18,422
Time deposits in foreign offices and other time		1,757		1,779		2,040		2,709		2,361		1,815		2,285

Total interest-bearing deposits		174,205		171,847		168,823		167,453		165,847		171,635		162,790
Borrowed funds
Federal funds purchased and repurchase agreements		1,844		1,881		2,048		1,925		2,298		1,924		2,708
Federal Home Loan Bank borrowings		17,524		18,716		19,855		20,796		21,882		18,694		21,556
Bank notes and senior debt		22,896		22,375		20,690		20,458		19,455		21,990		17,087
Subordinated debt		8,356		8,336		8,317		8,600		8,882		8,337		8,862
Commercial paper		—		1		3		302		1,867		1		3,486
Other		2,361		2,324		2,713		2,932		3,147		2,465		3,319

Total borrowed funds		52,981		53,633		53,626		55,013		57,531		53,411		57,018

Total interest-bearing liabilities		227,186		225,480		222,449		222,466		223,378		225,046		219,808
Noninterest-bearing liabilities and equity:
Noninterest-bearing deposits		78,303		75,775		77,306		79,479		77,553		77,133		75,359
Allowance for unfunded loan commitments and letters of credit		304		282		262		266		246		282		246
Accrued expenses and other liabilities		11,551		11,108		9,993		12,297		11,667		10,887		11,845
Equity		46,526		46,345		45,903		45,888		45,743		46,259		45,875

Total liabilities and equity	$	363,870	$	358,990	$	355,913	$	360,396	$	358,587	$	359,607	$	353,133


(a) Calculated using average daily balances.

Table 5: Supplemental Average Balance Sheet Information (Unaudited)
	Three months ended										Nine months ended
In millions	September 30 2016		June 30 2016		March 31 2016		December 31 2015		September 30 2015		September 30 2016		September 30 2015
Deposits and Common Shareholders’ Equity
Interest-bearing deposits	$	174,205	$	171,847	$	168,823	$	167,453	$	165,847	$	171,635	$	162,790
Noninterest-bearing deposits		78,303		75,775		77,306		79,479		77,553		77,133		75,359

Total deposits	$	252,508	$	247,622	$	246,129	$	246,932	$	243,400	$	248,768	$	238,149
Common shareholders’ equity	$	41,940	$	41,717	$	41,281	$	41,156	$	40,910	$	41,647	$	40,778


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 6

Table 6: Details of Net Interest Margin (Unaudited) (a)


	Three months ended															Nine months ended
	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Average yields/rates
Yield on interest-earning assets
Investment securities
Securities available for sale
Residential mortgage-backed
Agency		2.39	%		2.46	%		2.57	%		2.55	%		2.47	%		2.47	%		2.52	%
Non-agency		5.06	%		4.79	%		4.45	%		4.90	%		4.83	%		4.75	%		4.68	%
Commercial mortgage-backed		2.47	%		2.94	%		2.79	%		2.85	%		3.20	%		2.73	%		3.14	%
Asset-backed		2.31	%		2.32	%		2.19	%		2.14	%		2.15	%		2.27	%		2.12	%
U.S. Treasury and government agencies		1.33	%		1.50	%		1.55	%		1.09	%		1.36	%		1.46	%		1.26	%
Other		2.99	%		3.02	%		2.99	%		3.11	%		3.26	%		3.00	%		3.46	%
Total securities available for sale		2.42	%		2.54	%		2.55	%		2.53	%		2.66	%		2.50	%		2.70	%
Securities held to maturity
Residential mortgage-backed		2.71	%		2.81	%		3.02	%		2.98	%		3.05	%		2.85	%		3.07	%
Commercial mortgage-backed		3.51	%		3.61	%		3.53	%		3.67	%		3.65	%		3.55	%		3.82	%
Asset-backed		1.99	%		1.91	%		1.84	%		1.61	%		1.57	%		1.91	%		1.54	%
U.S. Treasury and government agencies		3.81	%		3.79	%		3.80	%		3.82	%		3.82	%		3.80	%		3.80	%
Other		6.58	%		5.40	%		5.35	%		5.25	%		5.23	%		5.77	%		5.19	%
Total securities held to maturity		3.29	%		3.22	%		3.37	%		3.36	%		3.43	%		3.29	%		3.49	%
Total investment securities		2.60	%		2.68	%		2.72	%		2.71	%		2.83	%		2.67	%		2.87	%
Loans
Commercial		3.05	%		3.08	%		3.08	%		2.97	%		3.02	%		3.07	%		3.00	%
Commercial real estate		3.23	%		3.16	%		3.51	%		3.47	%		3.35	%		3.30	%		3.52	%
Equipment lease financing		4.06	%		3.44	%		3.40	%		3.41	%		3.42	%		3.64	%		3.45	%
Consumer		4.32	%		4.28	%		4.29	%		4.15	%		4.18	%		4.29	%		4.17	%
Residential real estate		4.60	%		4.84	%		4.74	%		4.79	%		4.76	%		4.72	%		4.85	%
Total loans		3.57	%		3.56	%		3.60	%		3.52	%		3.54	%		3.58	%		3.55	%
Interest-earning deposits with banks		.50	%		.51	%		.50	%		.29	%		.25	%		.50	%		.25	%
Loans held for sale		4.07	%		4.24	%		4.34	%		4.66	%		4.23	%		4.20	%		4.25	%
Federal funds sold and resale agreements		.59	%		.55	%		.47	%		.29	%		.33	%		.53	%		.25	%
Other		3.44	%		4.02	%		4.23	%		4.83	%		5.33	%		3.89	%		5.13	%
Total yield on interest-earning assets		3.07	%		3.10	%		3.15	%		3.03	%		3.02	%		3.11	%		3.08	%
Rate on interest-bearing liabilities
Interest-bearing deposits
Money market		.19	%		.20	%		.22	%		.25	%		.29	%		.20	%		.27	%
Demand		.08	%		.08	%		.07	%		.06	%		.06	%		.07	%		.05	%
Savings		.40	%		.39	%		.39	%		.33	%		.18	%		.40	%		.17	%
Retail certificates of deposit		.70	%		.70	%		.70	%		.69	%		.68	%		.70	%		.69	%
Time deposits in foreign offices and other time		.24	%		.24	%		.27	%		.16	%		.17	%		.25	%		.18	%
Total interest-bearing deposits		.25	%		.24	%		.25	%		.25	%		.26	%		.25	%		.24	%
Borrowed funds
Federal funds purchased and repurchase agreements		.32	%		.29	%		.26	%		.14	%		.14	%		.29	%		.13	%
Federal Home Loan Bank borrowings		.86	%		.80	%		.68	%		.52	%		.49	%		.78	%		.47	%
Bank notes and senior debt		1.50	%		1.62	%		1.66	%		1.11	%		1.27	%		1.59	%		1.27	%
Subordinated debt		3.06	%		3.26	%		3.29	%		2.65	%		2.81	%		3.20	%		2.69	%
Commercial paper		—			.55	%		.40	%		.39	%		.38	%		.43	%		.35	%
Other		2.27	%		2.29	%		1.99	%		2.16	%		2.03	%		2.17	%		1.99	%
Total borrowed funds		1.53	%		1.57	%		1.51	%		1.15	%		1.18	%		1.54	%		1.12	%
Total rate on interest-bearing liabilities		.54	%		.56	%		.55	%		.47	%		.49	%		.55	%		.47	%

Interest rate spread		2.53	%		2.54	%		2.60	%		2.56	%		2.53	%		2.56	%		2.61	%
Impact of noninterest-bearing sources (b)		.15			.16			.15			.14			.14			.15			.13

Net interest margin		2.68	%		2.70	%		2.75	%		2.70	%		2.67	%		2.71	%		2.74	%

(a)

Calculated as annualized taxable-equivalent net interest income divided by average earning assets. The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest yields for all earning assets, interest income includes the effects of taxable-equivalent adjustments using a statutory federal income tax rate of 35% to increase tax-exempt interest income to a taxable-equivalent basis. This adjustment is not permitted under generally accepted accounting principles (GAAP) in the Consolidated Income Statement. The taxable-equivalent adjustments to net interest income for the three months ended September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015 and September 30, 2015, were $49 million, $48 million, $48 million, $48 million and $50 million, respectively. The taxable-equivalent adjustments to net interest income for the nine months ended September 30, 2016 and September 30, 2015 were $145 million and $148 million, respectively.

(b)	Represents the positive effects of investing noninterest-bearing sources in interest-earning assets.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 7

Total and Core Net Interest Income and Net Interest Margin (Unaudited)

Table 7: Total and Core Net Interest Income (Non-GAAP)


	Three months ended										Nine months ended
In millions	September 30 2016		June 30 2016		March 31 2016		December 31 2015		September 30 2015		September 30 2016		September 30 2015
Core net interest income (Non-GAAP) (a)	$	2,033	$	2,004	$	2,012	$	2,002	$	1,972	$	6,049	$	5,857
Total purchase accounting accretion
Scheduled accretion net of contractual interest		39		45		52		64		71		136		249
Excess cash recoveries (b)		23		19		34		26		19		76		80

Total purchase accounting accretion (c)		62		64		86		90		90		212		329

Total net interest income	$	2,095	$	2,068	$	2,098	$	2,092	$	2,062	$	6,261	$	6,186

(a)	We believe that core net interest income, a non-GAAP financial measure, is useful in evaluating the performance of our interest-based activities.

(b)	Relates to excess cash recoveries for purchased impaired commercial loans.

(c)	Total purchase accounting accretion includes purchase accounting accretion on purchased impaired loans.

Table 8: Details of Net Interest Margin (d)


	Three months ended															Nine months ended
	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Average yields/rates
Yield on interest-earning assets
Total investment securities		2.60	%		2.68	%		2.72	%		2.71	%		2.83	%		2.67	%		2.87	%
Total loans		3.57	%		3.56	%		3.60	%		3.52	%		3.54	%		3.58	%		3.55	%
Other		1.12	%		1.18	%		1.23	%		1.08	%		.99	%		1.17	%		1.05	%
Total yield on interest-earning assets		3.07	%		3.10	%		3.15	%		3.03	%		3.02	%		3.11	%		3.08	%
Rate on interest-bearing liabilities
Total interest-bearing deposits		.25	%		.24	%		.25	%		.25	%		.26	%		.25	%		.24	%
Total borrowed funds		1.53	%		1.57	%		1.51	%		1.15	%		1.18	%		1.54	%		1.12	%
Total rate on interest-bearing liabilities		.54	%		.56	%		.55	%		.47	%		.49	%		.55	%		.47	%
Interest rate spread		2.53	%		2.54	%		2.60	%		2.56	%		2.53	%		2.56	%		2.61	%
Impact of noninterest-bearing sources		.15			.16			.15			.14			.14			.15			.13

Net interest margin		2.68	%		2.70	%		2.75	%		2.70	%		2.67	%		2.71	%		2.74	%

(d)	See note (a) on page 6.

Table 9: Details of Core Net Interest Margin (Non-GAAP) (e)


	Three months ended															Nine months ended
	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Average yields/rates
Yield on interest-earning assets
Total investment securities		2.57	%		2.64	%		2.68	%		2.66	%		2.77	%		2.63	%		2.81	%
Total loans		3.43	%		3.42	%		3.42	%		3.34	%		3.36	%		3.42	%		3.33	%
Other		1.11	%		1.18	%		1.24	%		1.06	%		.99	%		1.17	%		1.05	%
Total yield on interest-earning assets		2.97	%		3.00	%		3.02	%		2.90	%		2.89	%		3.00	%		2.92	%
Rate on interest-bearing liabilities
Total interest-bearing deposits		.25	%		.24	%		.25	%		.26	%		.26	%		.25	%		.25	%
Total borrowed funds		1.38	%		1.44	%		1.38	%		1.02	%		1.06	%		1.40	%		1.01	%
Total rate on interest-bearing liabilities		.51	%		.53	%		.52	%		.44	%		.46	%		.52	%		.45	%
Interest rate spread		2.46	%		2.47	%		2.50	%		2.46	%		2.43	%		2.48	%		2.47	%
Impact of noninterest-bearing sources		.15			.16			.15			.14			.14			.15			.13

Core net interest margin (Non-GAAP)		2.61			2.63			2.65			2.60			2.57			2.63			2.60
Purchase accounting accretion impact on net interest margin		.07			.07			.10			.10			.10			.08			.14

Net interest margin (f)		2.68	%		2.70	%		2.75	%		2.70	%		2.67	%		2.71	%		2.74	%

(e)

We believe that core net interest margin, a non-GAAP financial measure, is useful as a tool to help evaluate the impact of purchase accounting accretion on net interest margin. To calculate core net interest margin, each calculated margin in the table has been adjusted by annualized purchase accounting accretion divided by average interest-earning assets.

(f)	See note (a) on page 6.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 8

Table 10: Details of Loans (Unaudited)


In millions	September 30 2016		June 30 2016		March 31 2016		December 31 2015		September 30 2015
Commercial
Retail/wholesale trade	$	17,211	$	16,786	$	16,736	$	16,661	$	16,986
Manufacturing		19,813		19,665		20,104		19,014		19,649
Service providers		14,159		14,258		14,141		13,970		13,550
Real estate related (a)		12,045		11,965		12,153		11,659		11,492
Financial services		7,203		7,400		6,084		7,234		5,511
Health care		9,148		9,092		9,106		9,210		9,397
Other industries		21,933		21,396		20,992		20,860		20,842

Total commercial		101,512		100,562		99,316		98,608		97,427

Commercial real estate
Real estate projects (b)		16,851		16,468		16,199		15,697		15,333
Commercial mortgage		12,422		12,372		12,031		11,771		10,760

Total commercial real estate		29,273		28,840		28,230		27,468		26,093

Equipment lease financing		7,378		7,620		7,584		7,468		7,644

Total commercial lending		138,163		137,022		135,130		133,544		131,164

Consumer
Home equity
Lines of credit		18,014		18,203		18,458		18,828		19,309
Installment		12,418		12,680		13,000		13,305		13,697
Credit card		5,029		4,896		4,746		4,862		4,600
Other consumer
Education		5,337		5,482		5,701		5,881		6,070
Automobile		11,898		11,449		11,177		11,157		11,039
Other		4,446		4,525		4,601		4,708		4,612

Total consumer		57,142		57,235		57,683		58,741		59,327

Residential real estate
Residential mortgage		14,915		14,562		14,425		14,162		14,038
Residential construction		226		237		247		249		454

Total residential real estate		15,141		14,799		14,672		14,411		14,492

Total consumer lending		72,283		72,034		72,355		73,152		73,819

Total loans (c)	$	210,446	$	209,056	$	207,485	$	206,696	$	204,983

(a)	Includes loans to customers in the real estate and construction industries.

(b)	Includes both construction loans and intermediate financing for projects.

(c)	Includes purchased impaired loans of $3.1 billion, $3.2 billion, $3.4 billion, $3.5 billion and $4.2 billion at September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015 and September 30, 2015, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 9

Allowances for Loan and Lease Losses (Unaudited)

Table 11: Change in Allowance for Loan and Lease Losses


Three months ended - in millions	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015
Beginning balance	$	2,685		$	2,711		$	2,727		$	3,237		$	3,272
Gross charge-offs:
Commercial		(107	)		(86	)		(78	)		(61	)		(63	)
Commercial real estate		(2	)		(10	)		(10	)		(15	)		(4	)
Equipment lease financing		(1	)		(2	)		(1	)		(3	)		(1	)
Home equity		(39	)		(28	)		(48	)		(42	)		(37	)
Residential real estate		(3	)		—			(8	)		(7	)		(11	)
Credit card		(39	)		(41	)		(42	)		(39	)		(37	)
Other consumer		(52	)		(46	)		(49	)		(49	)		(44	)

Total gross charge-offs		(243	)		(213	)		(236	)		(216	)		(197	)
Recoveries:
Commercial		26			28			33			31			42
Commercial real estate		12			13			12			20			11
Equipment lease financing		7			1			1			1			1
Home equity		25			17			21			24			25
Residential real estate		2			2			3			3			4
Credit card		5			5			4			5			5
Other consumer		12			13			13			12			13

Total recoveries		89			79			87			96			101
Net (charge-offs) / recoveries:
Commercial		(81	)		(58	)		(45	)		(30	)		(21	)
Commercial real estate		10			3			2			5			7
Equipment lease financing		6			(1	)		—			(2	)		—
Home equity		(14	)		(11	)		(27	)		(18	)		(12	)
Residential real estate		(1	)		2			(5	)		(4	)		(7	)
Credit card		(34	)		(36	)		(38	)		(34	)		(32	)
Other consumer		(40	)		(33	)		(36	)		(37	)		(31	)

Total net charge-offs		(154	)		(134	)		(149	)		(120	)		(96	)
Provision for credit losses		87			127			152			74			81
Net recoveries / (write-offs) of purchased impaired loans		7			3			1			(468	)
Other		1			(1	)		1			(1	)
Net change in allowance for unfunded loan commitments and letters of credit		(7	)		(21	)		(21	)		5			(20	)

Ending balance	$	2,619		$	2,685		$	2,711		$	2,727		$	3,237

Supplemental Information
Net charge-offs to average loans (for the three months ended) (annualized)		.29	%		.26	%		.29	%		.23	%		.19	%
Allowance for loan and lease losses to total loans (a)		1.24			1.28			1.31			1.32			1.58
Commercial lending net charge-offs	$	(65	)	$	(56	)	$	(43	)	$	(27	)	$	(14	)
Consumer lending net charge-offs		(89	)		(78	)		(106	)		(93	)		(82	)

Total net charge-offs	$	(154	)	$	(134	)	$	(149	)	$	(120	)	$	(96	)
Net charge-offs to average loans
Commercial lending		.19	%		.17	%		.13	%		.08	%		.04	%
Consumer lending		.49	%		.44	%		.59	%		.50	%		.44	%

(a)	See our 2015 Form 10-K for information on our change in derecognition policy effective December 31, 2015 for certain purchased impaired loans.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 10

Details of Nonperforming Assets (Unaudited)

Table 12: Nonperforming Assets by Type


In millions	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015
Nonperforming loans, including TDRs
Commercial lending
Commercial
Retail/wholesale trade	$	59		$	80		$	50		$	55		$	41
Manufacturing		43			69			83			79			73
Service providers		43			69			76			68			57
Real estate related (a)		68			73			36			40			45
Financial services		1			1			1			1			3
Health care		22			26			32			32			26
Other industries		285			288			274			76			56

Total commercial		521			606			552			351			301

Commercial real estate		152			143			160			187			212
Equipment lease financing		18			19			20			7			7

Total commercial lending		691			768			732			545			520

Consumer lending (b)
Home equity		895			926			957			977			1,029
Residential real estate		502			513			536			549			571
Credit card		4			4			4			3			3
Other consumer		54			53			52			52			54

Total consumer lending		1,455			1,496			1,549			1,581			1,657

Total nonperforming loans (c)		2,146			2,264			2,281			2,126			2,177

OREO and foreclosed assets
Other real estate owned (OREO)		217			239			259			279			293
Foreclosed and other assets		12			12			12			20			20

Total OREO and foreclosed assets (d)		229			251			271			299			313

Total nonperforming assets	$	2,375		$	2,515		$	2,552		$	2,425		$	2,490

Nonperforming loans to total loans		1.02	%		1.08	%		1.10	%		1.03	%		1.06	%
Nonperforming assets to total loans, OREO and foreclosed assets		1.13	%		1.20	%		1.23	%		1.17	%		1.21	%
Nonperforming assets to total assets		.64	%		.70	%		.71	%		.68	%		.69	%
Allowance for loan and lease losses to nonperforming loans (e) (f)		122	%		119	%		119	%		128	%		149	%

(a)	Includes loans related to customers in the real estate and construction industries.

(b)	Excludes most consumer loans and lines of credit, not secured by residential real estate, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.

(c)	Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale, loans accounted for under the fair value option and purchased impaired loans.

(d)

The recorded investment of loans collateralized by residential real estate property that are in process of foreclosure was $.4 billion, $.4 billion, $.5 billion, $.6 billion and $.6 billion at September 30, 2016, June 30, 2016, March 31, 2015, December 31, 2015 and September 30, 2015, which included $.3 billion, for all respective periods, of loans that are government insured/guaranteed.

(e)	The allowance for loan and lease losses includes impairment reserves attributable to purchased impaired loans.

(f)	See our 2015 Form 10-K for information on our change in derecognition policy effective December 31, 2015 for certain purchased impaired loans.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 11

Details of Nonperforming Assets (Unaudited) (Continued)

Table 13: Change in Nonperforming Assets


In millions	July 1, 2016 - September 30, 2016			April 1, 2016 - June 30, 2016			January 1, 2016 - March 31, 2016			October 1, 2015 - December 31, 2015			July 1, 2015 - September 30, 2015
Beginning balance	$	2,515		$	2,552		$	2,425		$	2,490		$	2,578
New nonperforming assets		370			405			542			370			381
Charge-offs and valuation adjustments		(153	)		(158	)		(161	)		(132	)		(114	)
Principal activity, including paydowns and payoffs		(171	)		(149	)		(98	)		(143	)		(167	)
Asset sales and transfers to loans held for sale		(113	)		(76	)		(90	)		(68	)		(106	)
Returned to performing status		(73	)		(59	)		(66	)		(92	)		(82	)

Ending balance	$	2,375		$	2,515		$	2,552		$	2,425		$	2,490

Table 14: Largest Individual Nonperforming Assets at September 30, 2016 (a)


In millions
Ranking	Outstandings		Industry
1		$50	Mining, Quarrying, Oil and Gas Extraction
2		40	Real Estate, Rental and Leasing
3		37	Mining, Quarrying, Oil and Gas Extraction
4		32	Real Estate, Rental and Leasing
5		30	Mining, Quarrying, Oil and Gas Extraction
6		27	Mining, Quarrying, Oil and Gas Extraction
7		25	Mining, Quarrying, Oil and Gas Extraction
8		24	Mining, Quarrying, Oil and Gas Extraction
9		21	Wholesale Trade
10		20	Mining, Quarrying, Oil and Gas Extraction

Total		$306

As a percent of total nonperforming assets 13%

(a)	Amounts shown are not net of related allowance for loan and lease losses, if applicable.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 12

Accruing Loans Past Due (Unaudited)

Table 15: Accruing Loans Past Due 30 to 59 Days (a)


	Amount										Percent of Total Outstandings
Dollars in millions	Sept. 30 2016		Jun. 30 2016		Mar. 31 2016		Dec. 31 2015		Sept. 30 2015		Sept. 30 2016			Jun. 30 2016			Mar. 31 2016			Dec. 31 2015			Sept. 30 2015
Commercial	$	64	$	61	$	85	$	69	$	56		.06	%		.06	%		.09	%		.07	%		.06	%
Commercial real estate		26		5		6		10		32		.09	%		.02	%		.02	%		.04	%		.12	%
Equipment lease financing		1		1		21		19		2		.01	%		.01	%		.28	%		.25	%		.03	%
Home equity		55		63		57		63		69		.18	%		.20	%		.18	%		.20	%		.21	%
Residential real estate
Non government insured		60		71		77		86		84		.40	%		.48	%		.52	%		.60	%		.58	%
Government insured		50		57		62		56		62		.33	%		.39	%		.42	%		.39	%		.43	%
Credit card		28		25		25		28		26		.56	%		.51	%		.53	%		.58	%		.57	%
Other consumer
Non government insured		66		71		57		64		58		.30	%		.33	%		.27	%		.29	%		.27	%
Government insured		104		110		116		116		119		.48	%		.51	%		.54	%		.53	%		.55	%

Total	$	454	$	464	$	506	$	511	$	508		.22	%		.22	%		.24	%		.25	%		.25	%


Table 16: Accruing Loans Past Due 60 to 89 Days (a)

	Amount										Percent of Total Outstandings
Dollars in millions	Sept. 30 2016		Jun. 30 2016		Mar. 31 2016		Dec. 31 2015		Sept. 30 2015		Sept. 30 2016			Jun. 30 2016			Mar. 31 2016			Dec. 31 2015			Sept. 30 2015
Commercial	$	24	$	34	$	18	$	32	$	39		.02	%		.03	%		.02	%		.03	%		.04	%
Commercial real estate		1		11		1		4		17		.00	%		.04	%		.00	%		.01	%		.07	%
Equipment lease financing		2		4				2				.03	%		.05	%					.03	%
Home equity		27		27		27		30		31		.09	%		.09	%		.09	%		.09	%		.09	%
Residential real estate
Non government insured		20		18		17		20		18		.13	%		.12	%		.12	%		.14	%		.12	%
Government insured		51		47		44		45		40		.34	%		.32	%		.30	%		.31	%		.28	%
Credit card		19		17		17		19		18		.38	%		.35	%		.36	%		.39	%		.39	%
Other consumer
Non government insured		24		21		21		21		22		.11	%		.10	%		.10	%		.10	%		.10	%
Government insured		68		64		64		75		80		.31	%		.30	%		.30	%		.34	%		.37	%

Total	$	236	$	243	$	209	$	248	$	265		.11	%		.12	%		.10	%		.12	%		.13	%


Table 17: Accruing Loans Past Due 90 Days or More (a)

	Amount										Percent of Total Outstandings
Dollars in millions	Sept. 30 2016		Jun. 30 2016		Mar. 31 2016		Dec. 31 2015		Sept. 30 2015		Sept. 30 2016			Jun. 30 2016			Mar. 31 2016			Dec. 31 2015			Sept. 30 2015
Commercial	$	37	$	38	$	39	$	45	$	36		.04	%		.04	%		.04	%		.05	%		.04	%
Residential real estate
Non government insured		18		23		23		21		27		.12	%		.16	%		.16	%		.15	%		.19	%
Government insured		478		466		483		545		558		3.16	%		3.15	%		3.29	%		3.78	%		3.85	%
Credit card		31		30		32		33		30		.62	%		.61	%		.67	%		.68	%		.65	%
Other consumer
Non government insured		13		13		12		17		15		.06	%		.06	%		.06	%		.08	%		.07	%
Government insured		189		184		193		220		224		.87	%		.86	%		.90	%		1.01	%		1.03	%

Total	$	766	$	754	$	782	$	881	$	890		.36	%		.36	%		.38	%		.43	%		.43	%

(a)	Excludes loans held for sale and purchased impaired loans.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 13

Business Segment Descriptions (Unaudited)

Retail Banking provides deposit, lending, brokerage, investment management and cash management services to consumer and small business customers within our primary geographic markets. Our customers are serviced through our branch network, ATMs, call centers, online banking and mobile channels. The branch network is located primarily in Pennsylvania, Ohio, New Jersey, Michigan, Illinois, Maryland, Indiana, Florida, North Carolina, Kentucky, Washington, D.C., Delaware, Virginia, Alabama, Georgia, Missouri, Wisconsin and South Carolina.

Corporate & Institutional Banking provides lending, treasury management, and capital markets-related products and services to mid-sized and large corporations, government and not-for-profit entities. Lending products include secured and unsecured loans, letters of credit and equipment leases. Treasury management services include cash and investment management, receivables management, disbursement services, funds transfer services, information reporting and global trade services. Capital markets-related products and services include foreign exchange, derivatives, securities, loan syndications, mergers and acquisitions advisory, equity capital markets advisory activities and related services. We also provide commercial loan servicing and technology solutions for the commercial real estate finance industry. Products and services are generally provided within our primary geographic markets, with certain products and services offered nationally and internationally.

Asset Management Group includes personal wealth management for high net worth and ultra high net worth clients and institutional asset management. Wealth management products and services include investment and retirement planning, customized investment management, private banking, tailored credit solutions, and trust management and administration for individuals and their families. Our Hawthorn unit provides multi-generational family planning including wealth strategy, investment management, private banking, tax and estate planning guidance, performance reporting and personal administration services to ultra high net worth families. Institutional asset management provides investment management, custody administration and retirement administration services. The business also offers PNC proprietary mutual funds. Institutional clients include corporations, unions, municipalities, non-profits, foundations and endowments, primarily located in our geographic footprint.

Residential Mortgage Banking directly originates first lien residential mortgage loans on a nationwide basis with a significant presence within the retail banking footprint. Mortgage loans represent loans collateralized by one-to-four family residential real estate. These loans are typically underwritten to government agency and/or third-party standards, and either sold, servicing retained, or held on PNC’s balance sheet. Loan sales are primarily to secondary mortgage conduits of Federal National Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC), Federal Home Loan Banks and third-party investors, or are securitized and issued under the Government National Mortgage Association (GNMA) program. The mortgage servicing operation performs all functions related to servicing mortgage loans, primarily those in first lien position, for various investors and for loans owned by PNC.

Non-Strategic Assets Portfolio includes a consumer portfolio of mainly residential mortgage and brokered home equity loans and lines of credit, and a small commercial/commercial real estate loan and lease portfolio. We obtained a significant portion of these non-strategic assets through acquisitions of other companies.

BlackRock, in which we hold an equity investment, is a leading publicly traded investment management firm providing a broad range of investment and risk management services to institutional and retail clients worldwide. Using a diverse platform of active and index investment strategies across asset classes, BlackRock develops investment outcomes and asset allocation solutions for clients. Product offerings include single- and multi-asset class portfolios investing in equities, fixed income, alternatives and money market instruments. BlackRock also offers an investment and risk management technology platform, risk analytics and advisory services and solutions to a broad base of institutional investors. Our equity investment in BlackRock provides us with an additional source of noninterest income and increases our overall revenue diversification. BlackRock is a publicly traded company, and additional information regarding its business is available in its filings with the Securities and Exchange Commission (SEC). At September 30, 2016, our economic interest in BlackRock was 22%.

Table 18: Period End Employees


	September 30 2016		June 30 2016		March 31 2016		December 31 2015		September 30 2015
Full-time employees
Retail Banking		21,654		21,649		21,903		21,896		21,960
Other full-time employees		27,597		27,365		27,331		27,252		27,639

Total full-time employees		49,251		49,014		49,234		49,148		49,599

Part-time employees
Retail Banking		2,354		2,595		2,684		2,877		2,985
Other part-time employees		438		781		462		488		564

Total part-time employees		2,792		3,376		3,146		3,365		3,549

Total		52,043		52,390		52,380		52,513		53,148


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 14

Table 19: Summary of Business Segment Income and Revenue (Unaudited) (a) (b)


	Three months ended													Nine months ended
In millions	September 30 2016		June 30 2016		March 31 2016			December 31 2015			September 30 2015			September 30 2016		September 30 2015
Income (Loss)
Retail Banking	$	223	$	307	$	268		$	213		$	251		$	798	$	694
Corporate & Institutional Banking		537		490		431			539			502			1,458		1,492
Asset Management Group		58		48		49			51			44			155		143
Residential Mortgage Banking		13		46		(13	)		(17	)		(4	)		46		43
Non-Strategic Assets Portfolio		54		29		52			96			68			135		205
Other, including BlackRock (b) (c)		121		69		156			140			212			346		544

Net income	$	1,006	$	989	$	943		$	1,022		$	1,073		$	2,938	$	3,121

Revenue
Retail Banking	$	1,647	$	1,682	$	1,650		$	1,645		$	1,643		$	4,979	$	4,804
Corporate & Institutional Banking		1,390		1,387		1,304			1,419			1,363			4,081		4,010
Asset Management Group		294		289		280			288			278			863		873
Residential Mortgage Banking		191		210		130			155			166			531		579
Non-Strategic Assets Portfolio		80		78		97			109			106			255		336
Other, including BlackRock (b) (c)		227		148		204			237			219			579		770

Total revenue	$	3,829	$	3,794	$	3,665		$	3,853		$	3,775		$	11,288	$	11,372

(a)

Our business information is presented based on our internal management reporting practices. We periodically refine our internal methodologies as management reporting practices are enhanced. Net interest income in business segment results reflects PNC’s internal funds transfer pricing methodology. Assets receive a funding charge and liabilities and capital receive a funding credit based on a transfer pricing methodology that incorporates product repricing characteristics, tenor and other factors.

(b)	We consider BlackRock to be a separate reportable business segment but have combined its results with Other for this presentation. Our third quarter 2016 Form 10-Q will include additional information regarding BlackRock.

(c)

Includes earnings and gains or losses related to PNC’s equity interest in BlackRock and residual activities that do not meet the criteria for disclosure as a separate reportable business, such as gains or losses related to BlackRock transactions, integration costs, asset and liability management activities including net securities gains or losses, other-than-temporary impairment of investment securities and certain trading activities, exited businesses, private equity investments, intercompany eliminations, most corporate overhead, tax adjustments that are not allocated to business segments and differences between business segment performance reporting and financial statement reporting (GAAP), including the presentation of net income attributable to noncontrolling interests as the segments’ results exclude their portion of net income attributable to noncontrolling interests.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 15

Table 20: Retail Banking (Unaudited) (a)


	Three months ended															Nine months ended
Dollars in millions	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Income Statement
Net interest income	$	1,120		$	1,118		$	1,113		$	1,074		$	1,069		$	3,351		$	3,152
Noninterest income		527			564			537			571			574			1,628			1,652

Total revenue		1,647			1,682			1,650			1,645			1,643			4,979			4,804
Provision for credit losses		104			29			77			108			57			210			151
Noninterest expense		1,191			1,168			1,150			1,203			1,190			3,509			3,558

Pretax earnings		352			485			423			334			396			1,260			1,095
Income taxes		129			178			155			121			145			462			401

Earnings	$	223		$	307		$	268		$	213		$	251		$	798		$	694

Average Balance Sheet
Loans
Consumer
Home equity	$	26,005		$	26,308		$	26,743		$	27,202		$	27,508		$	26,351		$	27,810
Automobile		11,353			10,978			10,787			10,608			10,440			11,040			10,374
Education		5,454			5,642			5,865			6,026			6,197			5,653			6,402
Credit cards		4,943			4,788			4,722			4,675			4,537			4,818			4,476
Other		1,783			1,793			1,823			1,870			1,884			1,800			1,886

Total consumer		49,538			49,509			49,940			50,381			50,566			49,662			50,948
Commercial and commercial real estate		11,937			12,319			12,551			12,588			12,611			12,268			12,744
Residential mortgage		508			536			596			609			649			546			704

Total loans	$	61,983		$	62,364		$	63,087		$	63,578		$	63,826		$	62,476		$	64,396
Total assets	$	71,219		$	71,544		$	72,216		$	72,677		$	72,916		$	71,658		$	73,430

Deposits
Noninterest-bearing demand	$	27,523		$	26,945		$	26,209		$	26,395		$	24,018		$	26,895		$	23,353
Interest-bearing demand		38,539			38,897			37,860			36,726			35,918			38,432			36,009
Money market		44,243			47,072			50,405			53,981			56,163			47,230			54,775
Savings		29,268			26,128			21,780			16,991			13,914			25,738			13,471
Certificates of deposit		14,631			15,048			15,350			15,789			16,234			15,008			16,763

Total deposits	$	154,204		$	154,090		$	151,604		$	149,882		$	146,247		$	153,303		$	144,371

Performance Ratios
Return on average assets		1.24	%		1.72	%		1.51	%		1.16	%		1.37	%		1.49	%		1.26	%
Noninterest income to total revenue		32	%		34	%		33	%		35	%		35	%		33	%		34	%
Efficiency		72	%		69	%		70	%		73	%		72	%		70	%		74	%

Supplemental Noninterest Income Information
Service charges on deposits	$	168		$	155		$	151		$	164		$	165		$	474		$	459
Brokerage	$	73		$	74		$	75		$	72		$	74		$	222		$	212
Consumer services	$	267		$	271		$	254		$	268		$	260		$	792		$	747

Other information (b)
Customer-related statistics (average):
Non-teller deposit transactions (c)		50	%		48	%		47	%		46	%		45	%		49	%		43	%
Digital consumer customers (d)		59	%		57	%		56	%		55	%		53	%		57	%		52	%

Credit-related statistics:
Nonperforming assets	$	970		$	995		$	1,023		$	1,045		$	1,092
Net charge-offs	$	89		$	75		$	96		$	93		$	66		$	260		$	251

Other statistics:
ATMs		9,045			8,993			8,940			8,956			8,996
Branches (e)		2,600			2,601			2,613			2,616			2,645
Universal branches (f)		475			467			362			359			355
Brokerage account client assets (billions) (g)	$	44		$	44		$	43		$	43		$	42

(a)	See note (a) on page 14.

(b)	Presented as of period end, except for customer-related statistics which are averages for the quarterly and year-to-date periods, respectively, and net charge-offs, which are for the three months and nine months ended, respectively.

(c)	Percentage of total consumer and business banking deposit transactions processed at an ATM or through our mobile banking application.

(d)	Represents consumer checking relationships that process the majority of their transactions through non-teller channels.

(e)	Excludes satellite offices (e.g., drive-ups, electronic branches and retirement centers) that provide limited products and/or services.

(f)	Included in total branches, represents branches operating under our Universal model.

(g)	Amounts include cash and money market balances.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 16

Table 21: Corporate & Institutional Banking (Unaudited) (a)


	Three months ended															Nine months ended
Dollars in millions	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Income Statement
Net interest income	$	873		$	854		$	870		$	881		$	887		$	2,597		$	2,613
Noninterest income		517			533			434			538			476			1,484			1,397

Total revenue		1,390			1,387			1,304			1,419			1,363			4,081			4,010
Provision for credit losses		12			69			107			23			46			188			83
Noninterest expense		555			549			521			554			533			1,625			1,594

Pretax earnings		823			769			676			842			784			2,268			2,333
Income taxes		286			279			245			303			282			810			841

Earnings	$	537		$	490		$	431		$	539		$	502		$	1,458		$	1,492

Average Balance Sheet
Loans held for sale	$	994		$	801		$	708		$	944		$	826		$	835		$	973
Loans
Commercial	$	88,481		$	87,741		$	86,645		$	85,750		$	85,452		$	87,625		$	85,304
Commercial real estate		26,866			26,497			25,817			24,520			22,965			26,395			22,536
Equipment lease financing		6,817			6,929			6,783			6,865			7,052			6,843			6,965

Total commercial lending		122,164			121,167			119,245			117,135			115,469			120,863			114,805
Consumer		394			441			499			553			694			445			971

Total loans	$	122,558		$	121,608		$	119,744		$	117,688		$	116,163		$	121,308		$	115,776
Total assets	$	139,806		$	138,305		$	135,521		$	133,083		$	131,613		$	137,884		$	131,678

Deposits
Noninterest-bearing demand	$	45,957		$	44,213		$	46,962		$	48,763		$	49,584		$	45,712		$	48,168
Money market		21,979			21,141			21,229			21,788			22,942			21,452			22,319
Other		15,041			12,958			11,316			11,414			10,578			13,111			9,776

Total deposits	$	82,977		$	78,312		$	79,507		$	81,965		$	83,104		$	80,275		$	80,263

Performance Ratios
Return on average assets		1.52	%		1.42	%		1.29	%		1.61	%		1.51	%		1.41	%		1.51	%
Noninterest income to total revenue		37	%		38	%		33	%		38	%		35	%		36	%		35	%
Efficiency		40	%		40	%		40	%		39	%		39	%		40	%		40	%

Other Information
Commercial loan servicing portfolio (in billions) (b) (c)	$	461		$	459		$	453		$	447		$	441
Consolidated revenue from: (d)
Treasury Management (e)	$	400		$	385		$	377		$	389		$	346		$	1,162		$	999
Capital Markets (e)	$	213		$	235		$	152		$	221		$	207		$	600		$	592
Commercial mortgage banking activities
Commercial mortgage loans held for sale (f)	$	27		$	24		$	26		$	46		$	21		$	77		$	94
Commercial mortgage loan servicing income (g)		66			66			66			70			70			198			191
Commercial mortgage servicing rights valuation, net of economic hedge (h)		1			20			1			3			1			22			25

Total	$	94		$	110		$	93		$	119		$	92		$	297		$	310
Average Loans (by C&IB business)
Corporate Banking	$	58,238		$	57,700		$	56,166		$	56,784		$	57,685		$	57,372		$	58,108
Real Estate		36,721			36,193			35,784			33,361			31,356			36,235			30,621
Business Credit		14,772			14,865			14,672			14,945			14,678			14,770			14,503
Equipment Finance		11,125			11,143			11,014			10,948			10,990			11,094			10,956
Other		1,702			1,707			2,108			1,650			1,454			1,837			1,588

Total average loans	$	122,558		$	121,608		$	119,744		$	117,688		$	116,163		$	121,308		$	115,776
Net carrying amount of commercial mortgage servicing rights (c)	$	473		$	448		$	460		$	526		$	505
Credit-related statistics:
Nonperforming assets (c)	$	671		$	752		$	701		$	518		$	484
Net charge-offs	$	69		$	59		$	41		$	24		$	26		$	169		$	6

(a)	See note (a) on page 14.

(b)	Represents loans serviced for PNC and others.

(c)	Presented as of period end.

(d)	Represents consolidated PNC amounts.

(e)	Includes amounts reported in net interest income, corporate service fees and other noninterest income.

(f)	Includes other noninterest income for valuations on commercial mortgage loans held for sale and related commitments, derivative valuations, origination fees, and gains on sale of loans held for sale and net interest income on loans held for sale.

(g)

Includes net interest income and noninterest income, primarily in corporate services fees, from loan servicing and ancillary services, net of changes in fair value on commercial mortgage servicing rights due to time and payoffs. Commercial mortgage servicing rights valuation, net of economic hedge is shown separately.

(h)	Includes amounts reported in corporate service fees.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 17

Table 22: Asset Management Group (Unaudited) (a)


	Three months ended															Nine months ended
Dollars in millions, except as noted	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Income Statement
Net interest income	$	74		$	76		$	77		$	77		$	71		$	227		$	215
Noninterest income		220			213			203			211			207			636			658

Total revenue		294			289			280			288			278			863			873
Provision for credit losses (benefit)		(3	)		6			(3	)		(2	)		(2	)		—			11
Noninterest expense		206			206			206			210			211			618			636

Pretax earnings		91			77			77			80			69			245			226
Income taxes		33			29			28			29			25			90			83

Earnings	$	58		$	48		$	49		$	51		$	44		$	155		$	143

Average Balance Sheet
Loans
Consumer	$	5,350		$	5,501		$	5,630		$	5,653		$	5,630		$	5,493		$	5,656
Commercial and commercial real estate		721			769			788			817			865			759			901
Residential mortgage		1,069			1,023			1,003			979			939			1,032			899

Total loans	$	7,140		$	7,293		$	7,421		$	7,449		$	7,434		$	7,284		$	7,456
Total assets	$	7,588		$	7,756		$	7,887		$	7,917		$	7,902		$	7,743		$	7,922

Deposits
Noninterest-bearing demand	$	1,426		$	1,393		$	1,407		$	1,466		$	1,220		$	1,409		$	1,207
Interest-bearing demand		3,845			4,085			4,280			4,199			4,125			4,069			4,126
Money market		3,850			4,229			4,758			5,426			5,462			4,278			5,072
Savings		2,524			2,002			1,563			859			236			2,032			193
Other		275			279			275			266			269			275			279

Total deposits	$	11,920		$	11,988		$	12,283		$	12,216		$	11,312		$	12,063		$	10,877

Performance Ratios
Return on average assets		3.03	%		2.48	%		2.52	%		2.56	%		2.21	%		2.68	%		2.41	%
Noninterest income to total revenue		75	%		74	%		73	%		73	%		74	%		74	%		75	%
Efficiency		70	%		71	%		74	%		73	%		76	%		72	%		73	%

Other Information
Nonperforming assets (b)	$	51		$	48		$	54		$	53		$	52
Net charge-offs (recoveries)	$	1		$	2		$	4		$	(1	)	$	3		$	7		$	14

Client Assets Under Administration (in billions) (b) (c) (d)
Discretionary client assets under management	$	138		$	135		$	135		$	134		$	132
Nondiscretionary client assets under administration		128			126			125			125			124

Total	$	266		$	261		$	260		$	259		$	256

Discretionary client assets under management
Personal	$	85		$	84		$	84		$	85		$	84
Institutional		53			51			51			49			48

Total	$	138		$	135		$	135		$	134		$	132

Equity	$	73		$	72		$	72		$	72		$	70
Fixed income		40			40			40			40			40
Liquidity/Other		25			23			23			22			22

Total	$	138		$	135		$	135		$	134		$	132

(a)	See note (a) on page 14.

(b)	As of period end.

(c)	Excludes brokerage account client assets.

(d)

As a result of certain investment advisory services performed by one of our registered investment advisors, certain assets are reported as both discretionary client assets under management and nondiscretionary client assets under administration. The amount of such assets was approximately $9 billion, $9 billion, $7 billion, $6 billion, and $6 billion as of September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015, and September 30, 2015, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 18

Table 23: Residential Mortgage Banking (Unaudited) (a)


	Three months ended															Nine months ended
Dollars in millions, except as noted	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Income Statement
Net interest income	$	28		$	28		$	25		$	30		$	31		$	81		$	91
Noninterest income		163			182			105			125			135			450			488

Total revenue		191			210			130			155			166			531			579
Provision for credit losses (benefit)		—			1			(1	)		—			2			—			2
Noninterest expense		170			136			152			181			171			458			510

Pretax earnings (loss)		21			73			(21	)		(26	)		(7	)		73			67
Income taxes (benefit)		8			27			(8	)		(9	)		(3	)		27			24

Earnings (loss)	$	13		$	46		$	(13	)	$	(17	)	$	(4	)	$	46		$	43

Average Balance Sheet
Loans held for sale	$	1,046		$	843		$	800		$	949		$	1,225		$	897		$	1,160
Loans	$	946		$	962		$	1,028		$	1,037		$	1,080		$	979		$	1,175
Mortgage servicing rights (MSR)	$	842		$	903		$	995		$	1,063		$	1,108		$	913		$	967
Total assets	$	6,160		$	5,768		$	6,306		$	6,477		$	6,513		$	6,078		$	6,962

Total deposits	$	2,947		$	2,777		$	2,330		$	2,469		$	2,529		$	2,685		$	2,415

Performance Ratios
Return on average assets		.84	%		3.20	%		(.84	)%		(1.04	)%		(.24	)%		1.01	%		.83	%
Noninterest income to total revenue		85	%		87	%		81	%		81	%		81	%		85	%		84	%
Efficiency		89	%		65	%		117	%		117	%		103	%		86	%		88	%

Supplemental Noninterest Income Information
Loan servicing revenue
Servicing fees	$	53		$	56		$	62		$	58		$	49		$	171		$	143
Mortgage servicing rights valuation, net of economic hedge (b)	$	7		$	30		$	(21	)	$	1		$	12		$	16		$	70
Loan sales revenue	$	103		$	95		$	64		$	64		$	75		$	262		$	278

Residential Mortgage Servicing Portfolio (in billions) (c)
Serviced portfolio balance (d)	$	126		$	126		$	125		$	123		$	122
Portfolio acquisitions	$	5		$	6		$	5		$	5		$	10		$	16		$	24
MSR asset value (d)	$	.8		$	.8		$	.9		$	1.1		$	1.0
MSR capitalization value (in basis points) (d)		65			61			69			86			79

Other Information
Loan origination volume (in billions)	$	3.1		$	2.6		$	1.9		$	2.3		$	2.7		$	7.6		$	8.2
Loan sale margin percentage		3.33	%		3.42	%		3.21	%		2.91	%		2.80	%		3.33	%		3.43	%
Percentage of originations represented by:
Purchase volume (e)		41	%		48	%		40	%		45	%		55	%		43	%		46	%
Refinance volume		59	%		52	%		60	%		55	%		45	%		57	%		54	%
Nonperforming assets (d)	$	57		$	65		$	75		$	81		$	88

(a)	See note (a) on page 14.

(b)

Consolidated PNC amounts, which include asset and liability management activities reported in the “Other, including Blackrock” business segment, were $30 million, $35 million, ($8) million, $6 million and $15 million for the quarters ended September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015, and September 30, 2015, respectively, and $57 million and $83 million for the nine months ended September 30, 2016 and 2015, respectively.

(c)	Represents loans serviced for third parties.

(d)	As of period end.

(e)	Mortgages with borrowers as part of residential real estate purchase transactions.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 19

Table 24: Non-Strategic Assets Portfolio (Unaudited) (a)


	Three months ended															Nine months ended
Dollars in millions	September 30 2016			June 30 2016			March 31 2016			December 31 2015			September 30 2015			September 30 2016			September 30 2015
Income Statement
Net interest income	$	72		$	73		$	75		$	90		$	90		$	220		$	302
Noninterest income		8			5			22			19			16			35			34

Total revenue		80			78			97			109			106			255			336
Provision for credit losses (benefit)		(22	)		13			(7	)		(53	)		(25	)		(16	)		(61	)
Noninterest expense		16			20			21			10			23			57			73

Pretax earnings		86			45			83			152			108			214			324
Income taxes		32			16			31			56			40			79			119

Earnings	$	54		$	29		$	52		$	96		$	68		$	135		$	205

Average Balance Sheet
Loans
Commercial lending	$	698		$	701		$	708		$	722		$	734		$	702		$	742
Consumer lending
Home equity		1,884			2,018			2,144			2,523			2,706			2,015			2,859
Residential real estate		2,999			3,132			3,245			3,565			3,741			3,125			3,981

Total consumer lending		4,883			5,150			5,389			6,088			6,447			5,140			6,840

Total loans		5,581			5,851			6,097			6,810			7,181			5,842			7,582
Other assets (b)		(279	)		(312	)		(281	)		(623	)		(721	)		(262	)		(702	)

Total assets	$	5,302		$	5,539		$	5,816		$	6,187		$	6,460		$	5,580		$	6,880

Performance Ratios
Return on average assets		4.04	%		2.10	%		3.63	%		6.16	%		4.18	%		3.23	%		3.98	%
Noninterest income to total revenue		10	%		6	%		23	%		17	%		15	%		14	%		10	%
Efficiency		20	%		26	%		22	%		9	%		22	%		22	%		22	%

Other Information
Nonperforming assets (c)	$	433		$	460		$	499		$	529		$	571
Purchased impaired loans (c) (d)	$	2,512		$	2,628		$	2,737		$	2,839		$	3,411
Net charge-offs (recoveries)	$	(6	)	$	(2	)	$	8		$	4		$	(1	)	$	—		$	(8	)
Loans (c)
Commercial lending	$	693		$	696		$	703		$	713		$	731
Consumer lending
Home equity		1,826			1,952			2,088			2,203			2,586
Residential real estate		2,933			3,062			3,190			3,300			3,625

Total consumer lending		4,759			5,014			5,278			5,503			6,211

Total loans	$	5,452		$	5,710		$	5,981		$	6,216		$	6,942

(a)	See note (a) on page 14.

(b)	Other assets were negative in all periods presented due to the allowance for loan and lease losses.

(c)	As of period end.

(d)	Recorded investment of purchased impaired loans related to acquisitions.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 20

Glossary Of Terms

Accretable net interest (Accretable yield) - The excess of cash flows expected to be collected on a purchased impaired loan over the carrying value of the loan. The accretable net interest is recognized into interest income over the remaining life of the loan using the constant effective yield method.

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

Annualized - Adjusted to reflect a full year of activity.

Basel III common equity Tier 1 capital - Common stock plus related surplus, net of treasury stock, plus retained earnings, plus accumulated other comprehensive income for securities currently and previously held as available for sale, plus accumulated other comprehensive income for pension and other postretirement benefit plans, less goodwill, net of associated deferred tax liabilities, less other disallowed intangibles, net of deferred tax liabilities and plus/less other adjustments.

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

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

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

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

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

Basis point - One hundredth of a percentage point.

Carrying value of purchased impaired loans - The net value on the balance sheet which represents the recorded investment less any valuation allowance.

Cash recoveries - Cash recoveries used in the context of purchased impaired loans represent cash payments for a single purchased impaired loan not included within a pool of loans from customers that exceeded the recorded investment of that loan.

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

Combined loan-to-value ratio (CLTV) - This is the aggregate principal balance(s) of the mortgages on a property divided by its appraised value or purchase price.

Common shareholders’ equity to total assets - Common shareholders’ equity divided by total assets. Common shareholders’ equity equals total shareholders’ equity less the liquidation value of preferred stock.

Core net interest income - Core net interest income is total net interest income less purchase accounting accretion.

Credit spread - The difference in yield between debt issues of similar maturity. The excess of yield attributable to credit spread is often used as a measure of relative creditworthiness, with a reduction in the credit spread reflecting an improvement in the borrower’s perceived creditworthiness.

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


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 21

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

Derivatives - Financial contracts whose value is derived from changes in publicly traded securities, interest rates, currency exchange rates or market indices. Derivatives cover a wide assortment of financial contracts, including but not limited to forward contracts, futures, options and swaps.

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

Duration of equity - An estimate of the rate sensitivity of our economic value of equity. A negative duration of equity is associated with asset sensitivity (i.e., positioned for rising interest rates), while a positive value implies liability sensitivity (i.e., positioned for declining interest rates). For example, if the duration of equity is -1.5 years, the economic value of equity increases by 1.5% for each 100 basis point increase in interest rates.

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

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

Efficiency - Noninterest expense divided by total revenue.

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

Fee income - When referring to the components of Noninterest income, we use the term fee income to refer to the following categories within Noninterest income: Asset management; Consumer services; Corporate services; Residential mortgage; and Service charges on deposits.

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

Funds transfer pricing - A management accounting methodology designed to recognize the net interest income effects of sources and uses of funds provided by the assets and liabilities of a business segment. Assets receive a funding charge and liabilities and capital receive a funding credit based on a transfer pricing methodology that incorporates product repricing characteristics, tenor and other factors.

Futures and forward contracts - Contracts in which the buyer agrees to purchase and the seller agrees to deliver a specific financial instrument at a predetermined price or yield. May be settled either in cash or by delivery of the underlying financial instrument.

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

Impaired loans - Loans are determined to be impaired when, based on current information and events, it is probable that all contractually required payments will not be collected. Impaired loans include commercial nonperforming loans and consumer and commercial TDRs, regardless of nonperforming status. Excluded from impaired loans are nonperforming leases, loans held for sale, loans accounted for under the fair value option, smaller balance homogenous type loans and purchased impaired loans.

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

LIBOR - Acronym for London InterBank Offered Rate. LIBOR is the average interest rate charged when banks in the London wholesale money market (or interbank market) borrow unsecured funds from each other. LIBOR rates are used as a benchmark for interest rates on a global basis. PNC’s product set includes loans priced using LIBOR as a benchmark.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 22

Loan-to-value ratio (LTV) - A calculation of a loan’s collateral coverage that is used both in underwriting and assessing credit risk in our lending portfolio. LTV is the sum total of loan obligations secured by collateral divided by the market value of that same collateral. Market values of the collateral are based on an independent valuation of the collateral. For example, a LTV of less than 90% is better secured and has less credit risk than a LTV of greater than or equal to 90%.

Loss given default (LGD) - An estimate of loss, net of recovery based on collateral type, collateral value, loan exposure, and other factors. Each loan has its own LGD. The LGD risk rating measures the percentage of exposure of a specific credit obligation that we expect to lose if default occurs. LGD is net of recovery, through any means, including but not limited to the liquidation of collateral or deficiency judgments rendered from foreclosure or bankruptcy proceedings.

Net interest margin - Annualized taxable-equivalent net interest income divided by average earning assets.

Nonaccretable difference - Contractually required payments receivable on a purchased impaired loan in excess of the cash flows expected to be collected.

Nonaccrual loans - Loans for which we do not accrue interest income. Nonaccrual loans include nonperforming loans, in addition to loans accounted for under fair value option and loans accounted for as held for sale for which full collection of contractual principal and/or interest is not probable.

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

Nonperforming assets - Nonperforming assets include nonperforming loans and OREO and foreclosed assets, but exclude certain government insured or guaranteed loans for which we expect to collect substantially all principal and interest, loans held for sale, loans accounted for under the fair value option and purchased impaired loans. We do not accrue interest income on assets classified as nonperforming.

Nonperforming loans - Loans accounted for at amortized cost for which we do not accrue interest income. Nonperforming loans include loans to commercial, commercial real estate, equipment lease financing, home equity, residential real estate, credit card and other consumer customers as well as TDRs which have not returned to performing status. Nonperforming loans exclude certain government insured or guaranteed loans for which we expect to collect substantially all principal and interest, loans held for sale, loans accounted for under the fair value option and purchased impaired loans. Nonperforming loans exclude purchased impaired loans as we are currently accreting interest income over the expected life of the loans.

Notional amount - A number of currency units, shares, or other units specified in a derivative contract.

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

Options - Contracts that grant the purchaser, for a premium payment, the right, but not the obligation, to either purchase or sell the associated financial instrument at a set price during a specified period or at a specified date in the future.

Other real estate owned (OREO) and foreclosed assets - Assets taken in settlement of troubled loans primarily through deed-in-lieu of foreclosure or foreclosure. Foreclosed assets include real and personal property, equity interests in corporations, partnerships, and limited liability companies. Excludes certain assets that have a government-guarantee which are classified as other receivables.

Other-than-temporary impairment (OTTI) - When the fair value of a security is less than its amortized cost basis, an assessment is performed to determine whether the impairment is other-than-temporary. If we intend to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, an other-than-temporary impairment is considered to have occurred. In such cases, an other-than-temporary impairment is recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. Further, if we do not expect to recover the entire amortized cost of the security, an other-than-temporary impairment is considered to have occurred. However for debt securities, if we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before its recovery, the other-than-temporary loss is separated into (a) the amount representing the credit loss, and (b) the amount related to all other factors. The other-than-temporary impairment related to credit losses is recognized in earnings while the amount related to all other factors is recognized in other comprehensive income, net of tax.

Parent company liquidity coverage - Liquid assets divided by funding obligations within a two year period.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 23

Pretax earnings - Income before income taxes and noncontrolling interests.

Probability of default (PD) - An internal risk rating that indicates the likelihood that a credit obligor will enter into default status.

Purchase accounting accretion - Accretion of the discounts and premiums on acquired assets and liabilities. The purchase accounting accretion is recognized in net interest income over the weighted-average life of the financial instruments using the constant effective yield method. Accretion for a single purchased impaired loan not included within a pool of loans includes any cash recoveries on that loan received in excess of the recorded investment.

Purchased impaired loans - Acquired loans (or pools of loans) determined to be credit impaired under FASB ASC 310-30 (AICPA SOP 03-3). Loans (or pools of loans) are determined to be impaired if there is evidence of credit deterioration since origination and for which it is probable that all contractually required payments will not be collected.

Recorded investment (purchased impaired loans) - The initial investment of a purchased impaired loan plus interest accretion and less any cash payments and writedowns to date. The recorded investment excludes any valuation allowance which is included in our allowance for loan and lease losses.

Recovery - Cash proceeds received on a loan that we had previously charged off. We credit the amount received to the allowance for loan and lease losses.

Residential development loans - Project-specific loans to commercial customers for the construction or development of residential real estate including land, single family homes, condominiums and other residential properties.

Return on average assets - Annualized net income divided by average assets.

Return on average capital - Annualized net income divided by average capital.

Return on average common shareholders’ equity - Annualized net income attributable to common shareholders divided by average common shareholders’ equity.

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

Securitization - The process of legally transforming financial assets into securities.

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

Taxable-equivalent interest - The interest income earned on certain assets is completely or partially exempt from Federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of yields and margins for all interest-earning assets, we use interest income on a taxable-equivalent basis in calculating average yields and net interest margins by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on other taxable investments. This adjustment is not permitted under GAAP on the Consolidated Income Statement.

Total equity - Total shareholders’ equity plus noncontrolling interests.

Transitional Basel III common equity – Common equity calculated under Basel III using phased in definitions and deductions applicable to PNC during the applicable presentation period.

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

Watchlist - A list of criticized loans, credit exposure or other assets compiled for internal monitoring purposes. We define criticized exposure for this purpose as exposure with an internal risk rating of other assets especially mentioned, substandard, doubtful or loss.


THE PNC FINANCIAL SERVICES GROUP, INC.		Page 24

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