Form: 8-K

Current report

April 15, 2025

Documents


Exhibit 99.2






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THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT
FIRST QUARTER 2025
(Unaudited)



THE PNC FINANCIAL SERVICES GROUP, INC.
FINANCIAL SUPPLEMENT
FIRST QUARTER 2025
(UNAUDITED)
Consolidated Results:
Page
6-7
9-11
Business Segment Results:
14-15
16-17
19-20

The information contained in this Financial Supplement is preliminary, unaudited and based on data available on April 15, 2025. This information speaks only as of the particular date or dates included in the schedules. We do not undertake any obligation to, and disclaim any duty to, correct or update any of the information provided in this Financial Supplement. Our future financial performance is subject to risks and uncertainties as described in our United States Securities and Exchange Commission (SEC) filings.

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



THE PNC FINANCIAL SERVICES GROUP, INC.
Cross Reference Index to First Quarter 2025 Financial Supplement (Unaudited)
Financial Supplement Table Reference
Table Description Page
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2
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9
10
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16
14-15
17
16-17
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THE PNC FINANCIAL SERVICES GROUP, INC.
Page 1

Table 1: Consolidated Income Statement (Unaudited)
Three months ended
March 31 December 31 September 30 June 30 March 31
In millions, except per share data 2025 2024 2024 2024 2024
Interest Income
Loans $ 4,472  $ 4,731  $ 4,954  $ 4,842  $ 4,819 
Investment securities 1,124  1,142  1,097  1,001  883 
Other 534  621  771  725  798 
Total interest income 6,130  6,494  6,822  6,568  6,500 
Interest Expense
Deposits 1,808  2,010  2,230  2,084  2,077 
Borrowed funds 846  961  1,182  1,182  1,159 
Total interest expense 2,654  2,971  3,412  3,266  3,236 
Net interest income 3,476  3,523  3,410  3,302  3,264 
Noninterest Income
Asset management and brokerage 391  374  383  364  364 
Capital markets and advisory 306  348  371  272  259 
Card and cash management 692  695  698  706  671 
Lending and deposit services 316  330  320  304  305 
Residential and commercial mortgage 134  122  181  131  147 
Other income
    Gain on Visa shares exchange program       754   
    Securities gains (losses) (2) (2) 1  (499)  
    Other (a) 139  177  68  77  135 
Total other income 137  175  69  332  135 
Total noninterest income 1,976  2,044  2,022  2,109  1,881 
Total revenue 5,452  5,567  5,432  5,411  5,145 
Provision For Credit Losses 219  156  243  235  155 
Noninterest Expense
Personnel 1,890  1,857  1,869  1,782  1,794 
Occupancy 245  240  234  236  244 
Equipment 384  473  357  356  341 
Marketing 85  112  93  93  64 
Other 783  824  774  890  891 
Total noninterest expense 3,387  3,506  3,327  3,357  3,334 
Income before income taxes and noncontrolling interests 1,846  1,905  1,862  1,819  1,656 
Income taxes 347  278  357  342  312 
Net income 1,499  1,627  1,505  1,477  1,344 
Less: Net income attributable to noncontrolling interests 18  17  15  18  14 
Preferred stock dividends (b) 71  94  82  95  81 
Preferred stock discount accretion and redemptions 2  2  2  2  2 
Net income attributable to common shareholders $ 1,408  $ 1,514  $ 1,406  $ 1,362  $ 1,247 
Earnings Per Common Share
Basic $ 3.52  $ 3.77  $ 3.50  $ 3.39  $ 3.10 
Diluted $ 3.51  $ 3.77  $ 3.49  $ 3.39  $ 3.10 
Average Common Shares Outstanding
Basic 398  399  399  400  400 
Diluted 398  399  400  400  400 
Efficiency 62  % 63  % 61  % 62  % 65  %
Noninterest income to total revenue 36  % 37  % 37  % 39  % 37  %
Effective tax rate (c) 18.8  % 14.6  % 19.2  % 18.8  % 18.8  %
(a)Includes Visa derivative fair value adjustments of $(40) million, $(23) million, $(128) million, $(116) million and $(7) million for the quarters ended March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024 and March 31, 2024, respectively. These adjustments are primarily related to escrow funding and the extension of anticipated litigation resolution timing.
(b)Dividends are payable quarterly, other than Series S preferred stock, which is payable semiannually.
(c)The effective income tax rates are generally lower than the statutory rate due to the relationship of pretax income to tax credits and earnings that are not subject to tax.




THE PNC FINANCIAL SERVICES GROUP, INC.
Page 2
Table 2: Consolidated Balance Sheet (Unaudited)
March 31 December 31 September 30 June 30 March 31
In millions, except par value 2025 2024 2024 2024 2024
Assets
Cash and due from banks $ 6,102  $ 6,904  $ 6,162  $ 6,242  $ 5,933 
Interest-earning deposits with banks (a) 32,298  39,347  35,024  33,039  53,612 
Loans held for sale (b) 1,236  850  750  988  743 
Investment securities – available-for-sale 63,318  62,039  60,338  51,188  42,280 
Investment securities – held-to-maturity 74,457  77,693  83,845  87,457  88,180 
Loans (b) 318,850  316,467  321,381  321,429  319,781 
Allowance for loan and lease losses (4,544) (4,486) (4,589) (4,636) (4,693)
Net loans 314,306  311,981  316,792  316,793  315,088 
Equity investments 9,448  9,600  9,217  9,037  8,280 
Mortgage servicing rights 3,564  3,711  3,503  3,739  3,762 
Goodwill 10,932  10,932  10,932  10,932  10,932 
Other (b) 39,061  36,981  38,318  37,104  37,352 
Total assets $ 554,722  $ 560,038  $ 564,881  $ 556,519  $ 566,162 
Liabilities
Deposits
Noninterest-bearing $ 92,369  $ 92,641  $ 94,588  $ 94,542  $ 98,061 
Interest-bearing (b) 330,546  334,097  329,378  321,849  327,563 
Total deposits 422,915  426,738  423,966  416,391  425,624 
Borrowed funds
Federal Home Loan Bank advances 18,000  22,000  28,000  35,000  37,000 
Senior debt 34,987  32,497  32,492  29,601  27,907 
Subordinated debt 4,163  4,104  4,196  4,078  4,827 
Other (b) 3,572  3,072  3,381  2,712  2,973 
Total borrowed funds 60,722  61,673  68,069  71,391  72,707 
Allowance for unfunded lending related commitments 674  719  725  717  672 
Accrued expenses and other liabilities (b) 13,960  16,439  16,392  15,339  15,785 
Total liabilities 498,271  505,569  509,152  503,838  514,788 
Equity
Preferred stock (c)
Common stock - $5 par value
Authorized 800,000,000 shares, issued 543,310,646; 543,310,646; 543,225,979; 543,225,979 and 543,116,260 shares 2,717  2,717  2,716  2,716  2,716 
Capital surplus 18,731  18,710  19,150  19,098  19,032 
Retained earnings 60,051  59,282  58,412  57,652  56,913 
Accumulated other comprehensive income (loss) (5,237) (6,565) (5,090) (7,446) (8,042)
Common stock held in treasury at cost: 147,519,772; 147,373,633; 146,306,706; 145,667,981 and 145,068,954 shares (19,857) (19,719) (19,499) (19,378) (19,279)
Total shareholders’ equity 56,405  54,425  55,689  52,642  51,340 
Noncontrolling interests 46  44  40  39  34 
Total equity 56,451  54,469  55,729  52,681  51,374 
Total liabilities and equity $ 554,722  $ 560,038  $ 564,881  $ 556,519  $ 566,162 
(a)Amounts include balances held with the Federal Reserve Bank of $31.9 billion, $39.0 billion, $34.6 billion, $32.6 billion and $53.2 billion as of March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024 and March 31, 2024, respectively.
(b)Amounts include assets and liabilities for which PNC has elected the fair value option. Our 2024 Form 10-K included, and our first quarter 2025 Form 10-Q will include, additional information regarding these items.
(c)Par value less than $0.5 million at each date.




THE PNC FINANCIAL SERVICES GROUP, INC.
Page 3
Table 3: Average Consolidated Balance Sheet (Unaudited) (a) (b)
Three months ended
March 31 December 31 September 30 June 30 March 31
In millions 2025 2024 2024 2024 2024
Assets
Interest-earning assets:
Investment securities
Securities available-for-sale
Residential mortgage-backed $ 33,793  $ 32,865  $ 31,491  $ 30,780  $ 30,989 
Commercial mortgage-backed 2,899  2,867 2,635 2,698 2,622
Asset-backed 2,322 2,344 2,177 1,987 1,414
U.S. Treasury and government agencies 24,382 23,086 17,311 15,350 8,199
Other 2,284 2,445 2,575 2,620 2,776
Total securities available-for-sale 65,680 63,607 56,189 53,435 46,000
Securities held-to-maturity
Residential mortgage-backed 40,045  40,833  41,698  42,234  42,633 
Commercial mortgage-backed 1,687  1,880  2,057  2,174  2,252 
Asset-backed 3,158  3,720  4,422  5,035  5,627
U.S. Treasury and government agencies 28,931 31,049  35,093 35,467  35,860
Other 2,680 2,774 2,855 2,961 3,062
Total securities held-to-maturity 76,501 80,256 86,125 87,871 89,434
Total investment securities 142,181 143,863 142,314 141,306 135,434
Loans
Commercial and industrial 177,333 177,433 177,019 177,130 177,258
Commercial real estate 33,067 34,476 35,451 35,523 35,522
Equipment lease financing 6,692 6,737 6,528 6,490 6,468
Consumer 53,421 53,735 53,543 53,503 53,933
Residential real estate 46,111 46,677 47,061 47,272 47,428
Total loans 316,624 319,058 319,602 319,918 320,609
Interest-earning deposits with banks (c) 34,614 37,929 45,319 41,113 48,250
Other interest-earning assets 10,147 10,337 8,909 9,279 8,002
Total interest-earning assets 503,566 511,187 516,144 511,616 512,295
Noninterest-earning assets 52,811 52,911 53,369 51,414 50,553
Total assets $ 556,377  $ 564,098  $ 569,513  $ 563,030  $ 562,848 
Liabilities and Equity
Interest-bearing liabilities:
Interest-bearing deposits
Money market $ 73,063  $ 73,219  $ 72,578  $ 67,631  $ 67,838 
Demand 125,046 124,294 119,914 121,423 122,748
Savings 97,409 95,957 95,939 97,232 97,719
Time deposits 32,763 35,656 37,880 34,663 32,975
Total interest-bearing deposits 328,281 329,126 326,311 320,949 321,280
Borrowed funds
Federal Home Loan Bank advances 19,703 24,014 31,785  35,962 37,717
Senior debt 34,933 32,572 32,204 29,717 28,475
Subordinated debt 4,320 4,324 4,330 4,567 5,082
Other 5,549 6,259 7,764 7,210 4,316
Total borrowed funds 64,505 67,169 76,083 77,456 75,590
Total interest-bearing liabilities 392,786 396,295 402,394 398,405 396,870
Noninterest-bearing liabilities and equity:
Noninterest-bearing deposits 92,367 96,136 95,811 96,284 98,875
Accrued expenses and other liabilities 16,214 17,068 17,395 17,144 16,404
Equity 55,010 54,599 53,913 51,197 50,699
Total liabilities and equity $ 556,377  $ 564,098  $ 569,513  $ 563,030  $ 562,848 
(a)Calculated using average daily balances.
(b)Nonaccrual loans are included in loans, net of unearned income. The impact of financial derivatives used in interest rate risk management is included in the interest income/expense and average yields/rates of the related assets and liabilities. Fair value adjustments related to hedged items are included in noninterest-earning assets and noninterest-bearing liabilities. Average balances of securities are based on amortized historical cost (excluding adjustments to fair value, which are included in other assets). Average balances for certain loans and borrowed funds accounted for at fair value are included in noninterest-earning assets and noninterest-bearing liabilities, with changes in fair value recorded in Noninterest income.
(c)Amounts include average balances held with the Federal Reserve Bank of $34.2 billion, $37.5 billion, $44.9 billion, $40.7 billion and $47.8 billion for the three months ended March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024 and March 31, 2024, respectively.

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 4
Table 4: Details of Net Interest Margin (Unaudited)
Three months ended
March 31 December 31 September 30 June 30 March 31
2025 2024 2024 2024 2024
Average yields/rates (a)
Yield on interest-earning assets
Investment securities
Securities available-for-sale
Residential mortgage-backed 3.68  % 3.60  % 3.45  % 3.11  % 3.00  %
Commercial mortgage-backed 2.92  % 3.11  % 3.08  % 3.07  % 2.99  %
Asset-backed 5.46  % 5.77  % 5.85  % 5.92  % 6.02  %
U.S. Treasury and government agencies 4.50  % 4.75  % 5.40  % 4.28  % 2.67  %
Other 2.73  % 2.69  % 2.70  % 2.66  % 2.63  %
Total securities available-for-sale 3.98  % 4.04  % 4.09  % 3.53  % 3.01  %
Securities held-to-maturity
Residential mortgage-backed 2.84  % 2.83  % 2.82  % 2.79  % 2.77  %
Commercial mortgage-backed 4.70  % 5.05  % 5.33  % 5.38  % 5.46  %
Asset-backed 3.97  % 4.31  % 4.62  % 4.65  % 4.49  %
U.S. Treasury and government agencies 1.49  % 1.46  % 1.33  % 1.31  % 1.31  %
Other 4.69  % 4.69  % 4.72  % 4.69  % 4.52  %
Total securities held-to-maturity 2.48  % 2.48  % 2.43  % 2.43  % 2.42  %
Total investment securities 3.17  % 3.17  % 3.08  % 2.84  % 2.62  %
Loans
Commercial and industrial 5.74  % 5.94  % 6.28  % 6.22  % 6.18  %
Commercial real estate 5.94  % 6.24  % 6.68  % 6.66  % 6.67  %
Equipment lease financing 5.05  % 5.43  % 5.65  % 5.37  % 5.17  %
Consumer 7.14  % 7.29  % 7.47  % 7.24  % 7.16  %
Residential real estate 3.78  % 3.75  % 3.73  % 3.70  % 3.65  %
Total loans 5.70  % 5.87  % 6.13  % 6.05  % 6.01  %
Interest-earning deposits with banks 4.42  % 4.86  % 5.48  % 5.47  % 5.47  %
Other interest-earning assets 6.02  % 6.17  % 6.78  % 6.98  % 6.92  %
Total yield on interest-earning assets 4.90  % 5.04  % 5.25  % 5.13  % 5.08  %
Rate on interest-bearing liabilities
Interest-bearing deposits
Money market 2.99  % 3.18  % 3.59  % 3.39  % 3.45  %
Demand 1.87  % 2.05  % 2.31  % 2.25  % 2.26  %
Savings 1.64  % 1.70  % 1.86  % 1.85  % 1.81  %
Time deposits 3.69  % 4.15  % 4.47  % 4.48  % 4.44  %
Total interest-bearing deposits 2.23  % 2.43  % 2.72  % 2.61  % 2.60  %
Borrowed funds
Federal Home Loan Bank advances 4.73  % 5.06  % 5.63  % 5.66  % 5.65  %
Senior debt 5.64  % 6.12  % 6.64  % 6.55  % 6.59  %
Subordinated debt 5.54  % 6.10  % 6.77  % 6.65  % 6.64  %
Other
4.38  % 4.70  % 5.28  % 5.51  % 5.59  %
Total borrowed funds 5.25  % 5.61  % 6.09  % 6.04  % 6.07  %
Total rate on interest-bearing liabilities 2.72  % 2.95  % 3.34  % 3.26  % 3.24  %
Interest rate spread 2.18  % 2.09  % 1.91  % 1.87  % 1.84  %
Benefit from use of noninterest-bearing sources (b) 0.60  % 0.66  % 0.73  % 0.73  % 0.73  %
Net interest margin 2.78  % 2.75  % 2.64  % 2.60  % 2.57  %
(a)Yields and rates are calculated using the applicable annualized interest income or interest expense divided by the applicable average earning assets or interest-bearing liabilities. Net interest margin is the total yield on interest-earning assets minus the total rate on interest-bearing liabilities and includes the benefit from use of noninterest-bearing sources. To provide more meaningful comparisons of net interest margins, we use net interest income on a taxable-equivalent basis in calculating average yields used in the calculation of net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP in the Consolidated Income Statement. The taxable-equivalent adjustments to net interest income for the three months ended March 31, 2025, December 31, 2024, September 30, 2024, June 30, 2024 and March 31, 2024 were $28 million, $30 million, $33 million, $34 million and $34 million, respectively.
(b)Represents the positive effects of investing noninterest-bearing sources in interest-earning assets.

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 5
Table 5: Details of Loans (Unaudited)
March 31 December 31 September 30 June 30 March 31
In millions 2025 2024 2024 2024 2024
Commercial
Commercial and industrial
Financial services $ 29,335  $ 27,737  $ 29,244  $ 27,986  $ 27,640 
Manufacturing 28,934 27,700 28,748 29,544 29,402
Service providers 22,943 21,881 22,033 21,948 21,413
Wholesale trade 19,176 18,399 18,338 18,532 17,341
Real estate related (a) 15,041 14,910 14,856 15,198 15,583
Retail trade 11,941 11,611 11,888 11,596 11,582
Technology, media and telecommunications 9,998 9,767 9,292 9,621 10,158
Health care 9,903 9,694 10,169 9,527 10,193
Transportation and warehousing 7,147 7,320 7,723 8,036 7,523
Other industries 26,119 26,771 26,600 26,801 25,957
Total commercial and industrial 180,537  175,790  178,891  178,789  176,792 
Commercial real estate 32,307  33,619  35,104  35,498  35,591 
Equipment lease financing 6,732  6,755  6,726  6,555  6,462 
Total commercial 219,576 216,164 220,721 220,842 218,845
Consumer
Residential real estate 45,890  46,415  46,972  47,183  47,386 
Home equity 25,846  25,991  25,970  25,917  25,896 
Automobile 15,324  15,355  15,135  14,820  14,788 
Credit card 6,550  6,879  6,827  6,849  6,887 
Education 1,597  1,636  1,693  1,732  1,859 
Other consumer 4,067  4,027  4,063  4,086  4,120 
Total consumer 99,274  100,303  100,660  100,587  100,936 
Total loans $ 318,850  $ 316,467  $ 321,381  $ 321,429  $ 319,781 
(a)Represents loans to customers in the real estate and construction industries.


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

Table 6: Change in Allowance for Loan and Lease Losses
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Allowance for loan and lease losses
Beginning balance $ 4,486  $ 4,589  $ 4,636  $ 4,693  $ 4,791 
Gross charge-offs:
Commercial and industrial (103) (78) (89) (77) (84)
Commercial real estate (18) (87) (102) (113) (56)
Equipment lease financing (10) (9) (9) (8) (8)
Residential real estate (2) (1)   (1) (1)
Home equity (9) (9) (8) (9) (10)
Automobile (35) (33) (34) (32) (32)
Credit card (90) (87) (86) (90) (92)
Education (5) (6) (4) (5) (4)
Other consumer (40) (44) (44) (40) (43)
Total gross charge-offs (312) (354) (376) (375) (330)
Recoveries:
Commercial and industrial 35  39  22  39  19 
Commercial real estate 5  2  2  7  2 
Equipment lease financing 7  5  4  6  2 
Residential real estate 2  2  2  3  3 
Home equity 8  11  10  12  9 
Automobile 23  23  25  24  25 
Credit card 15  13  15  12  15 
Education 2  1  2  1  2 
Other consumer 10  8  8  9  10 
Total recoveries 107  104  90  113  87 
Net (charge-offs) / recoveries:
Commercial and industrial (68) (39) (67) (38) (65)
Commercial real estate (13) (85) (100) (106) (54)
Equipment lease financing (3) (4) (5) (2) (6)
Residential real estate 1  2  2  2 
Home equity (1) 2  2  3  (1)
Automobile (12) (10) (9) (8) (7)
Credit card (75) (74) (71) (78) (77)
Education (3) (5) (2) (4) (2)
Other consumer (30) (36) (36) (31) (33)
Total net (charge-offs) (205) (250) (286) (262) (243)
Provision for credit losses (a) 260  155  235  204  147 
Other 3  (8) 4  1  (2)
Ending balance $ 4,544  $ 4,486  $ 4,589  $ 4,636  $ 4,693 
Supplemental Information
Net charge-offs
Commercial net charge-offs $ (84) $ (128) $ (172) $ (146) $ (125)
Consumer net charge-offs (121) (122) (114) (116) (118)
Total net charge-offs $ (205) $ (250) $ (286) $ (262) $ (243)
Net charge-offs to average loans (annualized) 0.26  % 0.31  % 0.36  % 0.33  % 0.30  %
Commercial 0.16  % 0.23  % 0.31  % 0.27  % 0.23  %
Consumer 0.49  % 0.48  % 0.45  % 0.46  % 0.47  %
(a)See Table 7 for the components of the Provision for credit losses being reported on the Consolidated Income Statement.



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

Table 7: Components of the Provision for Credit Losses
Three months ended
March 31 December 31 September 30 June 30 March 31
In millions 2025 2024 2024 2024 2024
Provision for credit losses
Loans and leases $ 260  $ 155  $ 235  $ 204  $ 147 
Unfunded lending related commitments (46) (5) 7  45  9 
Investment securities 3  (11) 1 
Other financial assets 2  6  1  (3) (2)
Total provision for credit losses $ 219  $ 156  $ 243  $ 235  $ 155 


Table 8: Allowance for Credit Losses by Loan Class (a)
March 31, 2025 December 31, 2024 March 31, 2024

Dollars in millions 		Allowance Amount Total Loans % of Total Loans Allowance Amount Total Loans % of Total Loans Allowance Amount Total Loans % of Total Loans
Allowance for loan and lease losses
Commercial
Commercial and industrial $ 1,704  $ 180,537  0.94  % $ 1,605  $ 175,790  0.91  % $ 1,673  $ 176,792  0.95  %
Commercial real estate 1,433  32,307  4.44  % 1,483  33,619  4.41  % 1,468  35,591  4.12  %
Equipment lease financing 68  6,732  1.01  % 60  6,755  0.89  % 76  6,462  1.18  %
Total commercial 3,205  219,576  1.46  % 3,148  216,164  1.46  % 3,217  218,845  1.47  %
Consumer
Residential real estate 43  45,890  0.09  % 37  46,415  0.08  % 39  47,386  0.08  %
Home equity 286  25,846  1.11  % 266  25,991  1.02  % 272  25,896  1.05  %
Automobile 167  15,324  1.09  % 160  15,355  1.04  % 173  14,788  1.17  %
Credit card 621  6,550  9.48  % 664  6,879  9.65  % 749  6,887  10.88  %
Education 48  1,597  3.01  % 48  1,636  2.93  % 56  1,859  3.01  %
Other consumer 174  4,067  4.28  % 163  4,027  4.05  % 187  4,120  4.54  %
Total consumer 1,339  99,274  1.35  % 1,338  100,303  1.33  % 1,476  100,936  1.46  %
Total
 4,544  $ 318,850  1.43  % 4,486  $ 316,467  1.42  % 4,693  $ 319,781  1.47  %
Allowance for unfunded lending related commitments
 674  719  672 
Allowance for credit losses
 $ 5,218  $ 5,205  $ 5,365 
Supplemental Information
Allowance for credit losses to total loans
 1.64  % 1.64  % 1.68  %
Commercial 1.70  % 1.72  % 1.71  %
Consumer 1.50  % 1.47  % 1.60  %
(a)    Excludes allowances for investment securities and other financial assets, which together totaled $91 million, $114 million and $117 million at March 31, 2025, December 31, 2024 and March 31, 2024, respectively.

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

Table 9: Nonperforming Assets by Type
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Nonperforming loans
Commercial
Commercial and industrial
Service providers $ 140  $ 187  $ 152  $ 152  $ 158 
Retail trade 121  18  22  51  9 
Manufacturing 96  30  35  79  60 
Health care 76  73  75  37  40 
Technology, media and telecommunications 52  73  74  108  177 
Transportation and warehousing 44  47  46  41  40 
Real estate related (a) 22  24  29  47  23 
Wholesale trade 15  43  127  19  21 
Other industries 30  33  162  168  50 
Total commercial and industrial 596  528  722  702  578 
Commercial real estate 851  919  993  928  923 
Equipment lease financing 20  15  14  16  13 
Total commercial 1,467  1,462  1,729  1,646  1,514 
Consumer (b)
Residential real estate 287  278  265  275  284 
Home equity 437  482  473  468  464 
Automobile 83  86  90  93  97 
Credit card 15  15  15  13  13 
Other consumer 3  3  6  8  8 
Total consumer 825  864  849  857  866 
Total nonperforming loans (c) 2,292  2,326  2,578  2,503  2,380 
OREO and foreclosed assets 32  31  31  34  35 
Total nonperforming assets $ 2,324  $ 2,357  $ 2,609  $ 2,537  $ 2,415 
Nonperforming loans to total loans 0.72  % 0.73  % 0.80  % 0.78  % 0.74  %
Nonperforming assets to total loans, OREO and foreclosed assets 0.73  % 0.74  % 0.81  % 0.79  % 0.76  %
Nonperforming assets to total assets 0.42  % 0.42  % 0.46  % 0.46  % 0.43  %
Allowance for loan and lease losses to nonperforming loans 198  % 193  % 178  % 185  % 197  %
(a)Represents loans related to customers in the real estate and construction industries.
(b)Excludes most unsecured consumer loans and lines of credit, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.
(c)Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale and loans accounted for under the fair value option.


Table 10: Change in Nonperforming Assets
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Beginning balance $ 2,357  $ 2,609  $ 2,537  $ 2,415  $ 2,216 
New nonperforming assets 477  397  661  571  616 
Charge-offs and valuation adjustments (135) (174) (200) (178) (133)
Principal activity, including paydowns and payoffs (156) (401) (322) (201) (188)
Asset sales and transfers to loans held for sale (77) (15) (6) (16) (16)
Returned to performing status (142) (59) (61) (54) (80)
Ending balance $ 2,324  $ 2,357  $ 2,609  $ 2,537  $ 2,415 




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

Table 11: Accruing Loans Past Due 30 to 59 Days (a)
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Commercial
Commercial and industrial $ 216 $ 159 $ 106 $ 95 $ 125
Commercial real estate 6 25 9 8 2
Equipment lease financing 41 41 22 19 22
Total commercial 263 225 137 122 149
Consumer
Residential real estate
Non government insured 208 161 162 201 179
Government insured 79 73 76 77 78
Home equity 71 71 65 64 64
Automobile 73 83 81 92 81
Credit card 45 49 55 50 49
Education
Non government insured 5 5 6 5 5
Government insured
 20 20 20 22 20
Other consumer 10 10 12 12 11
Total consumer 511 472 477 523 487
Total $ 774 $ 697 $ 614 $ 645 $ 636
Supplemental Information
Total accruing loans past due 30-59 days to total loans 0.24  % 0.22  % 0.19  % 0.20  % 0.20  %
Commercial 0.12  % 0.10  % 0.06  % 0.06  % 0.07  %
Consumer 0.51  % 0.47  % 0.47  % 0.52  % 0.48  %
(a)Excludes loans held for sale.








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

Table 12: Accruing Loans Past Due 60 to 89 Days (a)
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Commercial
Commercial and industrial $ 34 $ 43 $ 40 $ 53 $ 35
Commercial real estate 18 2
Equipment lease financing 11 12 12 6 4
Total commercial 45 73 52 61 39
Consumer
Residential real estate
Non government insured 93 58 40 48 50
Government insured 39 48 45 43 42
Home equity 28 26 27 24 24
Automobile 19 22 21 22 19
Credit card 33 38 39 37 37
Education
Non government insured
 3 2 3 2 4
Government insured
 11 13 13 13 13
Other consumer 7 8 12 9 7
Total consumer 233 215 200 198 196
Total $ 278 $ 288 $ 252 $ 259 $ 235
Supplemental Information
Total accruing loans past due 60-89 days to total loans 0.09  % 0.09  % 0.08  % 0.08  % 0.07  %
Commercial 0.02  % 0.03  % 0.02  % 0.03  % 0.02  %
Consumer 0.23  % 0.21  % 0.20  % 0.20  % 0.19  %
(a)Excludes loans held for sale.





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

Table 13: Accruing Loans Past Due 90 Days or More (a)
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Commercial
Commercial and industrial $ 75 $ 72 $ 97 $ 86 $ 90
Commercial real estate 1
Total commercial 75 72 97 87 90
Consumer
Residential real estate
Non government insured 53 56 52 27 38
Government insured 130 132 127 128 137
Automobile 7 9 6 6 5
Credit card 71 81 79 76 82
Education
Non government insured 2 2 2 2 3
Government insured
 34 37 38 34 40
Other consumer 7 8 8 8 9
Total consumer 304 325 312 281 314
Total $ 379 $ 397 $ 409 $ 368 $ 404
Supplemental Information
Total accruing loans past due 90 days or more to total loans 0.12  % 0.13  % 0.13  % 0.11  % 0.13  %
Commercial 0.03  % 0.03  % 0.04  % 0.04  % 0.04  %
Consumer 0.31  % 0.32  % 0.31  % 0.28  % 0.31  %
Total accruing loans past due $ 1,431 $ 1,382 $ 1,275 $ 1,272 $ 1,275
Commercial $ 383 $ 370 $ 286 $ 270 $ 278
Consumer $ 1,048 $ 1,012 $ 989 $ 1,002 $ 997
Total accruing loans past due to total loans 0.45  % 0.44  % 0.40  % 0.40  % 0.40  %
Commercial 0.17  % 0.17  % 0.13  % 0.12  % 0.13  %
Consumer 1.06  % 1.01  % 0.98  % 1.00  % 0.99  %
(a)Excludes loans held for sale.






































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

Retail Banking provides deposit, lending, brokerage, insurance services, investment management and cash management products and services to consumer and small business customers who are serviced through our coast-to-coast branch network, digital channels, ATMs, or through our phone-based customer contact centers. Deposit products include checking, savings and money market accounts and time deposits. Lending products include residential mortgages, home equity loans and lines of credit, auto loans, credit cards, education loans and personal and small business loans and lines of credit. The residential mortgage loans are directly originated within our branch network and nationwide, and are typically underwritten to agency and/or third-party standards, and either sold, servicing retained or held on our balance sheet. Brokerage, investment management and cash management products and services include managed, education, retirement and trust accounts.

Corporate & Institutional Banking provides lending, treasury management, capital markets and advisory products and services to mid-sized and large corporations and government and not-for-profit entities. Lending products include secured and unsecured loans, letters of credit and equipment leases. The Treasury Management business provides corporations with cash and investment management services, receivables and disbursement management services, funds transfer services and access to online/mobile information management and reporting services. Capital markets and advisory includes services and activities primarily related to merger and acquisitions advisory, equity capital markets advisory, asset-backed financing, loan syndication, securities underwriting and customer-related trading. We also provide commercial loan servicing and technology solutions for the commercial real estate finance industry. Products and services are provided nationally.

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

Table 14: Period End Employees
March 31 December 31 September 30 June 30 March 31
2025 2024 2024 2024 2024
Full-time employees
Retail Banking 27,108  27,513  27,740  27,935  28,580 
Other full-time employees 26,360  26,173  26,009  25,997  25,861 
Total full-time employees 53,468  53,686  53,749  53,932  54,441 
Part-time employees
Retail Banking 1,460  1,451  1,451  1,558  1,554 
Other part-time employees 48  47  49  422  56 
Total part-time employees 1,508  1,498  1,500  1,980  1,610 
Total 54,976  55,184  55,249  55,912  56,051 


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 13
Table 15: Summary of Business Segment Net Income and Revenue (Unaudited) (a)
Three months ended
March 31 December 31 September 30 June 30 March 31
In millions 2025 2024 2024 2024 2024
Net Income
Retail Banking $ 1,112  $ 1,074  $ 1,164  $ 1,715  $ 1,085 
Corporate & Institutional Banking 1,244  1,365  1,197  1,046  1,121 
Asset Management Group 113  103  104  103  97 
Other (988) (932) (975) (1,405) (973)
Net income excluding noncontrolling interests $ 1,481  $ 1,610  $ 1,490  $ 1,459  $ 1,330 
  
Revenue
Retail Banking $ 3,532  $ 3,532  $ 3,484  $ 4,118  $ 3,381 
Corporate & Institutional Banking 2,630  2,755  2,645  2,502  2,437 
Asset Management Group 427  413  403  398  387 
Other (1,137) (1,133) (1,100) (1,607) (1,060)
Total revenue $ 5,452  $ 5,567  $ 5,432  $ 5,411  $ 5,145 
(a)Our business information is presented based on our internal management reporting practices. Net interest income in business segment results reflects PNC’s internal funds transfer pricing methodology. Assets receive a funding charge and liabilities and capital receive a funding credit based on a transfer pricing methodology that incorporates product repricing characteristics, tenor and other factors.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 14
Table 16: Retail Banking (Unaudited) (a)
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Income Statement
Net interest income $ 2,826  $ 2,824  $ 2,783  $ 2,709  $ 2,617 
Noninterest income 706  708  701  1,409  764 
Total revenue 3,532  3,532  3,484  4,118  3,381 
Provision for credit losses 168  106  111  27  118 
Noninterest expense
Personnel 548  546  549  543  551 
Segment allocations (b) 938  948  901  910  894 
Depreciation and amortization 89  75  78  80  79 
Other (c) 328  442  314  308  313 
Total noninterest expense 1,903  2,011  1,842  1,841  1,837 
Pretax earnings 1,461  1,415  1,531  2,250  1,426 
Income taxes 340  330  358  524  333 
Noncontrolling interests 9  11  9  11  8 
Earnings $ 1,112  $ 1,074  752  $ 1,164  322  $ 1,715  $ 1,085 
Average Balance Sheet
Loans held for sale $ 860  $ 873  $ 986  $ 641  $ 478 
Loans
Consumer
Residential real estate $ 33,169  $ 33,620  $ 33,913  $ 34,144  $ 34,600 
Home equity 24,358  24,408  24,345  24,347  24,462 
Automobile 15,240  15,213  15,000  14,785  14,839 
Credit card 6,568  6,779  6,805  6,840  6,930 
Education 1,637  1,674  1,723  1,822  1,933 
Other consumer 1,754  1,776  1,756  1,745  1,771 
Total consumer 82,726  83,470  83,542  83,683  84,535 
Commercial 12,840  12,927  12,788  12,787  12,620 
Total loans $ 95,566  $ 96,397  $ 96,330  $ 96,470  $ 97,155 
Total assets $ 112,971  $ 114,957  $ 114,257  $ 115,102  $ 114,199 
Deposits
Noninterest-bearing $ 51,229  $ 52,425  $ 52,990  $ 53,453  $ 53,395 
Interest-bearing 193,832  194,364  196,255  196,278  195,615 
Total deposits $ 245,061  $ 246,789  $ 249,245  $ 249,731  $ 249,010 
Performance Ratios
Return on average assets 3.99  % 3.71  % 4.04  % 5.98  % 3.85  %
Noninterest income to total revenue 20  % 20  % 20  % 34  % 23  %
Efficiency 54  % 57  % 53  % 45  % 54  %
(continued on following page)



THE PNC FINANCIAL SERVICES GROUP, INC.
Page 15
Retail Banking (Unaudited) (Continued)
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions, except as noted 2025 2024 2024 2024 2024
Supplemental Noninterest Income Information
Asset management and brokerage $ 152  $ 135  $ 145  $ 135  $ 137 
Card and cash management $ 296  $ 308  $ 319  $ 330  $ 306 
Lending and deposit services $ 184  $ 191  $ 193  $ 182  $ 178 
Residential and commercial mortgage $ 65  $ 46  $ 129  $ 70  $ 97 
Residential Mortgage Information
Residential mortgage servicing statistics (in billions, except as noted) (d)
Serviced portfolio balance (e)
 $ 193  $ 197  $ 200  $ 204  $ 207 
MSR asset value (e)
 $ 2.5  $ 2.6  $ 2.5  $ 2.7  $ 2.7 
Servicing income: (in millions)
Servicing fees, net (f)
 $ 71  $ 69  $ 69  $ 67  $ 82 
Mortgage servicing rights valuation net of economic hedge
 $ (4) $ (28) $ 53  $ (14) $ (6)
Residential mortgage loan statistics
Loan origination volume (in billions) $ 1.0  $ 1.6  $ 1.8  $ 1.7  $ 1.3 
Loan sale margin percentage 0.58  % 1.26  % 1.45  % 1.96  % 2.53  %
Other Information
Credit-related statistics
Nonperforming assets (e)
 $ 804  $ 848  $ 836  $ 840  $ 841 
Net charge-offs - loans and leases $ 144  $ 152  $ 141  $ 138  $ 139 
Other statistics
Branches (e) (g)
 2,217  2,234  2,242  2,247  2,271 
Brokerage account client assets (in billions) (e) (h)
 $ 84  $ 84  $ 84  $ 81  $ 81 
(a)See note (a) on page 13.
(b)Represents expense allocations for corporate overhead services used by each business segment; primarily comprised of technology, human resources and occupancy-related allocations.
(c)Other is primarily comprised of other direct expenses including outside services and equipment expense. Amounts for the fourth quarter of 2024 also include asset impairments primarily related to technology investments.
(d)Represents mortgage loan servicing balances for third parties and the related income.
(e)Presented as of period end.
(f)Servicing fees net of impact of decrease in MSR value due to passage of time, which includes the impact from regularly scheduled loan principal payments, prepayments and loans paid off during the period.
(g)Reflects all branches excluding standalone mortgage offices and satellite offices (e.g., drive-ups, electronic branches and retirement centers) that provide limited products and/or services.
(h)Includes cash and money market balances.





THE PNC FINANCIAL SERVICES GROUP, INC.
Page 16
Table 17: Corporate & Institutional Banking (Unaudited) (a)
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Income Statement
Net interest income $ 1,652  $ 1,688  $ 1,615  $ 1,560  $ 1,549 
Noninterest income 978  1,067  1,030  942  888 
Total revenue 2,630  2,755  2,645  2,502  2,437 
Provision for credit losses 49  44  134  228  47 
Noninterest expense
Personnel 376  401  393  348  366 
Segment allocations (b) 383  386  371  374  366 
Depreciation and amortization 51  51  50  51  50 
Other (c) 146  143  136  138  140 
Total noninterest expense 956  981  950  911  922 
Pretax earnings 1,625  1,730  1,561  1,363  1,468 
Income taxes 377  361  359  312  342 
Noncontrolling interests 4  4  5  5  5 
Earnings $ 1,244  $ 1,365  $ 1,197  $ 1,046  $ 1,121 
Average Balance Sheet
Loans held for sale $ 255  $ 832  $ 339  $ 212  $ 151 
Loans
Commercial
Commercial and industrial $ 163,379  $ 163,410  $ 163,061  $ 163,083  $ 163,326 
Commercial real estate 32,151  33,525  34,450  34,441  34,420 
Equipment lease financing 6,692  6,737  6,529  6,490  6,467 
Total commercial 202,222  203,672  204,040  204,014  204,213 
Consumer 3  3  3  4  3 
Total loans $ 202,225  $ 203,675  $ 204,043  $ 204,018  $ 204,216 
Total assets $ 227,069  $ 227,845  $ 227,277  $ 229,604  $ 228,698 
Deposits
Noninterest-bearing $ 39,501  $ 42,119  $ 41,174  $ 41,185  $ 43,854 
Interest-bearing 108,503  109,205  104,872  98,716  98,841 
Total deposits $ 148,004  $ 151,324  $ 146,046  $ 139,901  $ 142,695 
Performance Ratios
Return on average assets 2.22  % 2.38  % 2.09  % 1.83  % 1.99  %
Noninterest income to total revenue 37  % 39  % 39  % 38  % 36  %
Efficiency 36  % 36  % 36  % 36  % 38  %
(continued on following page)

























THE PNC FINANCIAL SERVICES GROUP, INC.
Page 17
Table 17: Corporate & Institutional Banking (Unaudited) (Continued)
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions 2025 2024 2024 2024 2024
Other Information
Consolidated revenue from:
Treasury Management (d) $ 1,049  $ 1,058  $ 974  $ 954  $ 936 
Commercial mortgage banking activities:
Commercial mortgage loans held for sale (e) $ 26  $ 38  $ 16  $ 17  $ 10 
Commercial mortgage loan servicing income (f) 94  112  90  84  67 
Commercial mortgage servicing rights valuation,
  net of economic hedge
 39  39  32  39  37 
Total $ 159  $ 189  $ 138  $ 140  $ 114 
Commercial mortgage servicing statistics
Serviced portfolio balance (in billions) (g) (h) $ 294  $ 290  $ 289  $ 289  $ 287 
MSR asset value (g) $ 1,041  $ 1,085  $ 975  $ 1,082  $ 1,075 
Average loans by C&IB business
Corporate Banking $ 117,659  $ 116,364  $ 116,330  $ 116,439  $ 116,845 
Real Estate 43,283  45,472  46,181  45,987  46,608 
Business Credit 30,044  30,343  29,825  29,653  28,929 
Commercial Banking 7,343  7,290  7,438  7,527  7,546 
Other 3,896  4,206  4,269  4,412  4,288 
Total average loans $ 202,225  $ 203,675  $ 204,043  $ 204,018  $ 204,216 
Credit-related statistics
Nonperforming assets (g) $ 1,372  $ 1,368  $ 1,624  $ 1,528  $ 1,419 
Net charge-offs - loans and leases $ 64  $ 100  $ 147  $ 129  $ 108 
(a)See note (a) on page 13.
(b)Represents expense allocations for corporate overhead services used by each business segment; primarily comprised of technology, human resources and occupancy-related allocations.
(c)Other is primarily comprised of other direct expenses including outside services and equipment expense.
(d)Amounts are reported in net interest income and noninterest income.
(e)Represents commercial mortgage banking income for valuations on commercial mortgage loans held for sale and related commitments, derivative valuations, origination fees, gains on sale of loans held for sale and net interest income on loans held for sale.
(f)Represents net interest income and noninterest income from loan servicing, net of reduction in commercial mortgage servicing rights due to time and payoffs. Commercial mortgage servicing rights valuation, net of economic hedge is shown separately.
(g)Presented as of period end.
(h)Represents balances related to capitalized servicing.


THE PNC FINANCIAL SERVICES GROUP, INC.
Page 18
Table 18: Asset Management Group (Unaudited) (a)
Three months ended
March 31 December 31 September 30 June 30 March 31
Dollars in millions, except as noted 2025 2024 2024 2024 2024
Income Statement
Net interest income $ 184  $ 171  $ 161  $ 163  $ 157 
Noninterest income 243  242  242  235  230 
Total revenue 427  413  403  398  387 
Provision for (recapture of) credit losses 1  2  (2) 2  (5)
Noninterest expense
Personnel 121  116  120  115  121 
Segment allocations (b) 117  123  114  110  107 
Depreciation and amortization 8  8  6  9  7 
Other (c) 33  30  30  27  30 
Total noninterest expense 279  277  270  261  265 
Pretax earnings 147  134  135  135  127 
Income taxes 34  31  31  32  30 
Earnings $ 113  $ 103  $ 104  $ 103  $ 97 
Average Balance Sheet
Loans
Consumer
Residential real estate $ 11,935  $ 12,019  $ 12,075  $ 12,022  $ 11,688 
Other consumer 3,663  3,676  3,695  3,736  3,758 
Total consumer 15,598  15,695  15,770  15,758  15,446 
Commercial 658  668  715  814  849 
Total loans $ 16,256  $ 16,363  $ 16,485  $ 16,572  $ 16,295 
Total assets $ 16,702  $ 16,815  $ 16,928  $ 17,018  $ 16,728 
Deposits
Noninterest-bearing $ 1,618  $ 1,617  $ 1,674  $ 1,648  $ 1,617 
Interest-bearing 26,501  26,056  25,571  26,245  27,064 
Total deposits $ 28,119  $ 27,673  $ 27,245  $ 27,893  $ 28,681 
Performance Ratios
Return on average assets 2.74  % 2.43  % 2.44  % 2.43  % 2.35  %
Noninterest income to total revenue 57  % 59  % 60  % 59  % 59  %
Efficiency 65  % 67  % 67  % 66  % 68  %
Other Information
Nonperforming assets (d) $ 36  $ 28  $ 36  $ 51  $ 28 
Net charge-offs - loans and leases   $ 2 
Client Assets Under Administration (in billions) (d) (e)
Discretionary client assets under management
 PNC Private Bank $ 127  $ 129  $ 132  $ 123  $ 124 
Institutional Asset Management 83  82  82  73  71 
Total discretionary clients assets under management 210  211  214  196  195 
Nondiscretionary client assets under administration 201  210  216  208  199 
Total $ 411  $ 421  $ 430  $ 404  $ 394 
(a)See note (a) on page 13.
(b)Represents expense allocations for corporate overhead services used by each business segment; primarily comprised of technology, human resources and occupancy-related allocations.
(c)Other is primarily comprised of other direct expenses including outside services and equipment expense.
(d)Presented as of period end.
(e)Excludes brokerage account client assets.

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 19
Glossary of Terms

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

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

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

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

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

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

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

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

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

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

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

Criticized commercial loans – Loans with potential or identified weaknesses based upon internal risk ratings that comply with the regulatory classification definitions of “special mention,” “substandard” or “doubtful.”

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

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

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

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

Efficiency – Noninterest expense divided by total revenue.

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

Fee income – Refers to the following categories within Noninterest income: Asset management and brokerage, Capital markets and advisory, Card and cash management, Lending and deposit services, and Residential and commercial mortgage.

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

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

THE PNC FINANCIAL SERVICES GROUP, INC.
Page 20
Nondiscretionary client assets under administration – Assets we hold for our customers/clients in a nondiscretionary, custodial capacity. We do not include these assets on our Consolidated Balance Sheet.

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

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

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

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

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

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

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

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

Taxable-equivalent interest income – The interest income earned on certain assets that is completely or partially exempt from federal income tax. These tax-exempt instruments typically yield lower returns than taxable investments.

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