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PNC Financial Services Group
250 EuroWeek Financing financial institutions
PNC Financial Services Group
Subordinated debt Senior unsecured Securitisation
-
5,000
10,000
15,000
20,000
25,000
30,000
2005 2006 2007 2008 2009 2010
Source: Dealogic. Data to August 20 2010
$m
Debt issuance
%
Source: PNC
0
2
4
6
8
10
12
14
16
2Q09 1Q10 2Q10
Tier one risk-based (reported)
Tier one common (reported)
Total risk-based
Debt issuance
capital ratios
pricing date: August4,2010
Value: $750m
Maturity date: August11,2020
coupon: 4.375%
spread to benchmark: 150bpoverUSTs
bookrunners: BankofAmericaMerrillLynch,JPMorgan
pricing date: May13,2010
Value: $500m
Maturity date: May19,2014
coupon: 3%
spread to benchmark: 112.5bpoverUSTs
bookrunners: JPMorgan,MorganStanley
pricing date: February3,2010
Value: $1bn
Maturity date: February8,2015
coupon: 3.625%
spread to benchmark: 125bpoverUSTs
bookrunners: MorganStanley,JPMorgan
Source: Dealogic
rank lead Manager amount $m no of issues
% share
1 JPMorgan 1,621 4 50
2 Morgan Stanley 1,248 3 38.5
3 Bank of America Merrill Lynch
373 1 11.5
subtotal 3,243 4 100
total 3,243 4 100
Source: Dealogic (Sep 20, 2009 to Sep 19, 2010)
recent Deals
-
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
-204
0
2041
+
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Source: Dealogic. Data to September 1, 2010 (securitisations not included)
$m
Maturity profile
top bookrunners
executive vice-president, director of investor relationsWilliam H Callihan+1 412 762 [email protected]
key contacts
pnc financial services Group inc
long term iDr a+short term iDr f1individual rating bsupport rating 5support rating floor no floor
summary:Fitch Ratings recently affirmed PNC’s long-term issuer default rating and long-term senior debt rating at A+ in recognition of its improved franchise, good liquidity, and solid core pre-tax, pre-provision earnings power.
The company’s profile was fundamentally altered with the December 31, 2008 acquisition of National City Corporation (NCC), doubling in size to become the fifth largest bank holding company in the US based on deposits. PNC has not reported any issues related to the integration to date. In the past, PNC has reported better credit quality, especially NCOs, than its regional and large bank peers. However, PNC is not immune to the difficult operating environment and has reported increasing levels of problem assets. NCC’s exposures across all risk categories were evaluated and marked to fair value by PNC through purchase accounting as of December 31, 2008.
To date, PNC’s credit valuations on their impaired loans appear to be holding up fairly well. With the exception of 4Q08, when PNC reported an approximately $500m conforming provision related to the NCC acquisition, the company has been profitable every quarter over the past two years. PNC made considerable progress during 2009 in rebuilding capital ratios.
fitch ratinGs upDate
PNC Financial Services Group
$m
Source: PNC
0
500
1,000
1,500
2,000
2,500
3,000
2Q09 1Q10 2Q10
Net interest income Pre-tax, pre-prevision earnings
Net income
$bn
Source: PNC
0
20
40
60
80
100
120
140
160
180
200
2Q09 1Q10 2Q10
%
Non-interest income to total revenue. Source: PNC
34
35
36
37
38
39
40
41
42
43
2Q09 1Q10 2Q10
%
Source: PNC
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2Q09 1Q10 2Q10
Non-performing loans to total loans Non-performing assets to total assets Net charge-offs to average loans (annualised)
%
Source: PNC
0
10
20
30
40
50
60
70
2Q09 1Q10 2Q10
$bn
Source: PNC
250
255
260
265
270
275
280
285
2Q09 1Q10 2Q10
incoMe stateMent
loans & Deposits
incoMe/reVenue ratio
npl ratios
efficiency ratio
total assets
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