Document

EX-99.1 2 q32021financialsupplement.htm EX-99.1 Document

Exhibit 99.1

THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2021

(Unaudited)

THE PNC FINANCIAL SERVICES GROUP, INC.

FINANCIAL SUPPLEMENT

THIRD QUARTER 2021

(UNAUDITED)


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

Business Segment Results:
Descriptions			13
Period End Employees			13
Net Income and Revenue			14
Retail Banking			15-16
Corporate & Institutional Banking			17
Asset Management Group			18

Glossary of Terms			19-21

The information contained in this Financial Supplement is preliminary, unaudited and based on data available on October 15, 2021. 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 (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 primarily in markets across the Mid-Atlantic, Midwest, Southeast and Southwest. PNC also has strategic international offices in four countries outside the U.S.

ACQUISITION OF BBVA USA BANCSHARES, INC.

On June 1, 2021, PNC acquired BBVA USA Bancshares Inc. (BBVA), a U.S. financial holding company conducting its business operations primarily through its U.S. banking subsidiary, BBVA USA. PNC paid $11.5 billion in cash as consideration for the acquisition, and added $82.2 billion of deposits and $60.5 billion of loans to PNC's Consolidated Balance Sheet as a result of the acquisition.

As of October 12, 2021, PNC has converted approximately 2.6 million customers, 9,000 employees and nearly 600 branches across seven states, merging BBVA USA into PNC Bank. PNC's third quarter earnings results reflect the full quarter benefit of BBVA's acquired business operations, and our second quarter results reflect BBVA business operations for the month of June 2021. PNC's balance sheets at both September 30, 2021 and June 30, 2021 include BBVA's balances. Our second quarter 2021 Form 10-Q included additional information on the June 1, 2021 acquisition of BBVA.

DISCONTINUED OPERATIONS

On May 15, 2020, PNC completed the sale of its 31.6 million shares of BlackRock, Inc., common and preferred stock through a registered secondary offering. In addition, BlackRock repurchased 2.65 million shares from PNC. The total proceeds from the sale were $14.2 billion in cash, net of $0.2 billion in expenses, and resulted in a gain on sale of $4.3 billion. Additionally, PNC contributed 500,000 BlackRock shares to the PNC Foundation on May 18, 2020. As a result, PNC has divested its entire holding in BlackRock. PNC and its affiliates only hold shares of BlackRock stock in a fiduciary capacity for clients of PNC and its affiliates. Activity for BlackRock for all periods presented on the Consolidated Income Statement have been reclassified to discontinued operations in accordance with Accounting Standard Codification (ASC) 205-20, Presentation of Financial Statements - Discontinued Operations.


THE PNC FINANCIAL SERVICES GROUP, INC.
Cross Reference Index to Third Quarter 2021 Financial Supplement (Unaudited)
Financial Supplement Table Reference

Table	Description	Page
1	Consolidated Income Statement	1
2	Consolidated Balance Sheet	2
3	Average Consolidated Balance Sheet	3
4	Details of Net Interest Margin	4
5	Per Share Related Information	5
6	Details of Loans	6
7	Change in Allowance for Loan and Lease Losses	7
8	Components of the Provision for (Recapture of) Credit Losses	8
9	Allowance for Credit Losses by Loan Class	8
10	Nonperforming Assets by Type	9
11	Change in Nonperforming Assets	9
12	Accruing Loans Past Due 30 to 59 Days	10
13	Accruing Loans Past Due 60 to 89 Days	11
14	Accruing Loans Past Due 90 Days or More	12
15	Period End Employees	13
16	Summary of Business Segment Net Income and Revenue	14
17	Retail Banking	15-16
18	Corporate & Institutional Banking	17
19	Asset Management Group	18


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 1

Table 1: Consolidated Income Statement (Unaudited) (a)


	Three months ended															Nine months ended
	September 30			June 30			March 31			December 31			September 30			September 30			September 30
In millions, except per share data	2021			2021			2021			2020			2020			2021			2020
Interest Income
Loans	$	2,437		$	2,160		$	1,996		$	2,074		$	2,116		$	6,593		$	6,853
Investment securities	460			469			421			442			490			1,350			1,599
Other	78			72			66			60			70			216			279
Total interest income	2,975			2,701			2,483			2,576			2,676			8,159			8,731
Interest Expense
Deposits	29			30			40			53			74			99			590
Borrowed funds	90			90			95			99			118			275			619
Total interest expense	119			120			135			152			192			374			1,209
Net interest income	2,856			2,581			2,348			2,424			2,484			7,785			7,522
Noninterest Income
Asset management	248			239			226			221			215			713			615
Consumer services	496			457			384			387			390			1,337			1,097
Corporate services	842			688			555			650			479			2,085			1,517
Residential mortgage	147			103			105			99			137			355			505
Service charges on deposits	159			131			119			134			119			409			366
Other (b)	449			468			483			293			457			1,400			1,071
Total noninterest income	2,341			2,086			1,872			1,784			1,797			6,299			5,171
Total revenue	5,197			4,667			4,220			4,208			4,281			14,084			12,693
Provision For (Recapture of) Credit Losses	(203)			302			(551)			(254)			52			(452)			3,429
Noninterest Expense
Personnel	1,986			1,640			1,477			1,521			1,410			5,103			4,152
Occupancy	248			217			215			215			205			680			611
Equipment	355			326			293			296			292			974			880
Marketing	103			74			45			64			67			222			172
Other	895			793			544			612			557			2,232			1,774
Total noninterest expense	3,587			3,050			2,574			2,708			2,531			9,211			7,589
Income from continuing operations before income taxes and noncontrolling interests	1,813			1,315			2,197			1,754			1,698			5,325			1,675
Income taxes from continuing operations	323			212			371			298			166			906			128
Net income from continuing operations	1,490			1,103			1,826			1,456			1,532			4,419			1,547
Income from discontinued operations before taxes																			5,777
Income taxes from discontinued operations																			1,222
Net income from discontinued operations																			4,555
Net income	1,490			1,103			1,826			1,456			1,532			4,419			6,102
Less: Net income attributable to noncontrolling interests	16			12			10			14			13			38			27
Preferred stock dividends (c)	57			48			57			48			63			162			181
Preferred stock discount accretion and redemptions	1			1			1			1			1			3			3
Net income attributable to common shareholders	$	1,416		$	1,042		$	1,758		$	1,393		$	1,455		$	4,216		$	5,891
Earnings Per Common Share
Basic earnings from continuing operations	$	3.31		$	2.43		$	4.11		$	3.26		$	3.40		$	9.84		$	3.11
Basic earnings from discontinued operations																			10.61
Total basic earnings	$	3.31		$	2.43		$	4.11		$	3.26		$	3.40		$	9.84		$	13.73
Diluted earnings from continuing operations	$	3.30		$	2.43		$	4.10		$	3.26		$	3.39		$	9.83		$	3.11
Diluted earnings from discontinued operations																			10.59
Total diluted earnings	$	3.30		$	2.43		$	4.10		$	3.26		$	3.39		$	9.83		$	13.70
Average Common Shares Outstanding
Basic	426			427			426			425			426			426			427
Diluted	426			427			426			426			426			427			428
Efficiency	69		%	65		%	61		%	64		%	59		%	65		%	60		%
Noninterest income to total revenue	45		%	45		%	44		%	42		%	42		%	45		%	41		%
Effective tax rate from continuing operations (d)	17.8		%	16.1		%	16.9		%	17.0		%	9.8		%	17.0		%	7.6		%

(a)Results reflect the BBVA acquisition beginning in the month of June 2021.

(b)Includes net gains on sales of securities of $15 million, $10 million, $25 million, $51 million and $32 million for the quarters ended September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020 and September 30, 2020, respectively. Amounts for the nine months ended September 30, 2021 and 2020 were $50 million and $254 million, respectively.

(c)Dividends are payable quarterly other than Series R and Series S preferred stock, which are payable semiannually. On September 13, 2021, PNC issued 1,500,000 depositary shares of Series T preferred stock with a $1 par value. Beginning on December 15, dividends will be paid on the Series T on a quarterly basis (March 15, June 15, September 15 and December 15 of each year).

(d)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) (a)


	September 30		June 30		March 31		December 31		September 30
In millions, except par value	2021		2021		2021		2020		2020
Assets
Cash and due from banks	$	8,843	$	8,724	$	7,455	$	7,017	$	6,629
Interest-earning deposits with banks (b)	75,478		72,447		86,161		85,173		70,959
Loans held for sale (c)	2,121		2,227		1,967		1,597		1,787
Investment securities – available for sale	124,127		125,058		96,799		87,358		89,747
Investment securities – held to maturity	1,479		1,485		1,456		1,441		1,438
Loans (c)	290,230		294,704		237,013		241,928		249,279
Allowance for loan and lease losses	(5,355)		(5,730)		(4,714)		(5,361)		(5,751)
Net loans	284,875		288,974		232,299		236,567		243,528
Equity investments	7,737		7,521		6,386		6,052		4,938
Mortgage servicing rights	1,833		1,793		1,680		1,242		1,113
Goodwill	10,885		10,958		9,317		9,233		9,233
Other (c)	36,137		35,025		30,894		30,999		32,445
Total assets	$	553,515	$	554,212	$	474,414	$	466,679	$	461,817
Liabilities
Deposits
Noninterest-bearing	$	156,305	$	154,190	$	120,641	$	112,637	$	107,281
Interest-bearing	292,597		298,693		254,426		252,708		247,798
Total deposits	448,902		452,883		375,067		365,345		355,079
Borrowed funds
Federal Home Loan Bank borrowings					1,500		3,500		5,500
Bank notes and senior debt	22,993		24,408		22,139		24,271		26,839
Subordinated debt	7,074		7,120		6,241		6,403		6,465
Other (c)	3,404		3,285		3,150		3,021		3,306
Total borrowed funds	33,471		34,813		33,030		37,195		42,110
Allowance for unfunded lending related commitments	646		645		507		584		689
Accrued expenses and other liabilities	14,199		11,186		11,931		9,514		10,629
Total liabilities	497,218		499,527		420,535		412,638		408,507
Equity
Preferred stock (d)
Common stock - $5 par value
Authorized 800 shares, issued 543, 543, 543, 543, and 542 shares	2,713		2,713		2,713		2,713		2,712
Capital surplus	17,453		15,928		15,879		15,884		15,836
Retained earnings	49,541		48,663		48,113		46,848		45,947
Accumulated other comprehensive income	1,079		1,463		1,290		2,770		2,997
Common stock held in treasury at cost:120, 118, 118, 119, and 118 shares	(14,527)		(14,140)		(14,146)		(14,205)		(14,216)
Total shareholders’ equity	56,259		54,627		53,849		54,010		53,276
Noncontrolling interests	38		58		30		31		34
Total equity	56,297		54,685		53,879		54,041		53,310
Total liabilities and equity	$	553,515	$	554,212	$	474,414	$	466,679	$	461,817

(a)BBVA balances are included at September 30, 2021 and June 30, 2021.

(b)Amounts include balances held with the Federal Reserve Bank of $75.1 billion, $71.9 billion, $85.8 billion, $84.9 billion and $70.6 billion as of September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020 and September 30, 2020, respectively.

(c)Amounts include assets and liabilities for which PNC has elected the fair value option. Our second quarter 2021 Form 10-Q included, and our third quarter 2021 Form 10-Q will include, additional information regarding these items.

(d)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										Nine months ended
	September 30		June 30		March 31		December 31		September 30		September 30		September 30
In millions	2021		2021		2021		2020		2020		2021		2020
Assets
Interest-earning assets:
Investment securities
Securities available for sale
Residential mortgage-backed
Agency	$	63,163	$	56,042	$	45,298	$	48,036	$	52,215	$	54,900	$	51,453
Non-agency	1,051		1,142		1,236		1,337		1,437		1,142		1,527
Commercial mortgage-backed	6,134		6,465		6,241		6,568		6,927		6,280		6,964
Asset-backed	5,608		5,855		5,304		5,017		5,033		5,590		5,115
U.S. Treasury and government agencies	38,149		32,419		22,309		18,783		18,724		31,017		16,714
Other	4,994		5,107		4,561		4,561		4,723		4,889		4,567
Total securities available for sale	119,099		107,030		84,949		84,302		89,059		103,818		86,340
Securities held to maturity


Asset-backed													24
U.S. Treasury and government agencies	807		802		797		793		788		802		783
Other	680		671		650		650		655		667		648
Total securities held to maturity	1,487		1,473		1,447		1,443		1,443		1,469		1,455
Total investment securities	120,586		108,503		86,396		85,745		90,502		105,287		87,795
Loans
Commercial and industrial	152,964		137,892		129,996		134,944		139,795		140,368		140,701
Commercial real estate	37,054		31,611		28,598		28,991		29,081		32,452		28,689
Equipment lease financing	6,300		6,332		6,332		6,380		6,771		6,321		6,958
Consumer	57,533		52,575		50,904		52,872		54,692		53,695		56,279
Residential real estate	37,475		27,197		22,305		22,638		22,753		29,048		22,292
Total loans	291,326		255,607		238,135		245,825		253,092		261,884		254,919
Interest-earning deposits with banks (c)	80,274		78,522		85,410		76,374		60,327		81,383		37,582
Other interest-earning assets	9,113		8,079		7,829		8,134		9,752		8,345		10,028
Total interest-earning assets	501,299		450,711		417,770		416,078		413,673		456,899		390,324
Noninterest-earning assets	57,943		53,718		50,450		48,901		48,466		54,065		53,705
Total assets	$	559,242	$	504,429	$	468,220	$	464,979	$	462,139	$	510,964	$	444,029
Liabilities and Equity
Interest-bearing liabilities:
Interest-bearing deposits
Money market	$	82,911	$	64,990	$	59,083	$	62,621	$	63,598	$	69,105	$	59,426
Demand	106,588		99,091		91,619		88,026		87,226		99,154		80,371
Savings	89,679		87,307		82,926		79,430		77,479		86,662		74,279
Time deposits	19,293		18,048		18,449		19,448		20,248		18,577		21,084
Total interest-bearing deposits	298,471		269,436		252,077		249,525		248,551		273,498		235,160
Borrowed funds
Federal Home Loan Bank borrowings			265		2,411		4,761		7,196		883		11,051
Bank notes and senior debt	22,573		22,620		22,799		24,022		25,858		22,663		28,040
Subordinated debt	6,787		6,218		5,929		5,936		5,936		6,315		5,935
Other	4,992		5,046		4,057		3,433		4,354		4,701		6,199
Total borrowed funds	34,352		34,149		35,196		38,152		43,344		34,562		51,225
Total interest-bearing liabilities	332,823		303,585		287,273		287,677		291,895		308,060		286,385
Noninterest-bearing liabilities and equity:
Noninterest-bearing deposits	155,948		132,283		113,299		109,878		101,931		133,999		90,078
Accrued expenses and other liabilities	15,332		14,755		14,258		14,348		15,341		14,787		16,251
Equity	55,139		53,806		53,390		53,076		52,972		54,118		51,315
Total liabilities and equity	$	559,242	$	504,429	$	468,220	$	464,979	$	462,139	$	510,964	$	444,029

(a)Calculated using average daily balances.

(b)Results reflect the BBVA acquisition beginning in the month of June 2021.

(c)Amounts include average balances held with the Federal Reserve Bank of Cleveland of $80.1 billion, $78.3 billion, $85.2 billion, $76.1 billion and $60.0 billion for the three months ended September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020 and September 30, 2020, and $81.1 billion and $37.3 billion for the nine months ended September 30, 2021 and September 30, 2020, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 4


Table 4: Details of Net Interest Margin (Unaudited) (a)
	Three months ended										Nine months ended
	September 30		June 30		March 31		December 31		September 30		September 30		September 30
	2021		2021		2021		2020		2020		2021		2020
Average yields/rates (b)
Yield on interest-earning assets
Investment securities
Securities available for sale
Residential mortgage-backed
Agency	1.41	%	1.61	%	1.72	%	1.81	%	2.03	%	1.56	%	2.31	%
Non-agency	8.07	%	7.85	%	7.24	%	7.15	%	7.26	%	7.70	%	7.43	%
Commercial mortgage-backed	2.34	%	2.49	%	2.58	%	2.66	%	2.50	%	2.47	%	2.68	%
Asset-backed	1.50	%	2.07	%	1.84	%	2.04	%	2.44	%	1.80	%	2.70	%
U.S. Treasury and government agencies	1.18	%	1.30	%	1.68	%	1.77	%	1.64	%	1.34	%	1.88	%
Other	2.90	%	3.00	%	3.28	%	3.45	%	3.39	%	3.05	%	3.51	%
Total securities available for sale	1.51	%	1.73	%	1.95	%	2.05	%	2.16	%	1.70	%	2.43	%
Securities held to maturity


Asset-backed													2.66	%
U.S. Treasury and government agencies	2.88	%	2.86	%	2.83	%	2.88	%	2.86	%	2.86	%	2.85	%
Other	4.33	%	3.67	%	4.17	%	4.20	%	4.20	%	4.05	%	4.32	%
Total securities held to maturity	3.54	%	3.23	%	3.43	%	3.47	%	3.47	%	3.40	%	3.50	%
Total investment securities	1.54	%	1.75	%	1.97	%	2.08	%	2.18	%	1.73	%	2.45	%
Loans
Commercial and industrial	2.80	%	2.89	%	2.91	%	2.87	%	2.82	%	2.87	%	3.07	%
Commercial real estate	3.17	%	2.92	%	2.80	%	2.63	%	2.65	%	2.98	%	3.03	%
Equipment lease financing	3.83	%	3.76	%	3.90	%	3.90	%	3.80	%	3.83	%	3.85	%
Consumer	4.85	%	4.82	%	4.78	%	4.74	%	4.69	%	4.82	%	4.98	%
Residential real estate	3.15	%	3.50	%	3.53	%	3.69	%	3.74	%	3.35	%	3.85	%
Total loans	3.32	%	3.38	%	3.38	%	3.35	%	3.32	%	3.36	%	3.58	%
Interest-earning deposits with banks	0.16	%	0.11	%	0.10	%	0.10	%	0.10	%	0.12	%	0.28	%
Other interest-earning assets	2.03	%	2.46	%	2.34	%	1.99	%	2.23	%	2.27	%	2.64	%
Total yield on interest-earning assets	2.36	%	2.40	%	2.40	%	2.46	%	2.57	%	2.38	%	2.98	%
Rate on interest-bearing liabilities
Interest-bearing deposits
Money market	0.03	%	0.03	%	0.03	%	0.05	%	0.07	%	0.03	%	0.29	%
Demand	0.03	%	0.03	%	0.04	%	0.04	%	0.05	%	0.03	%	0.17	%
Savings	0.04	%	0.05	%	0.06	%	0.08	%	0.11	%	0.05	%	0.39	%
Time deposits	0.12	%	0.20	%	0.32	%	0.41	%	0.58	%	0.21	%	0.91	%
Total interest-bearing deposits	0.04	%	0.05	%	0.06	%	0.08	%	0.12	%	0.05	%	0.34	%
Borrowed funds
Federal Home Loan Bank borrowings			0.35	%	0.43	%	0.40	%	0.47	%	0.42	%	1.16	%
Bank notes and senior debt	0.97	%	0.98	%	1.04	%	1.00	%	1.08	%	1.00	%	1.72	%
Subordinated debt	1.28	%	1.35	%	1.43	%	1.38	%	1.51	%	1.35	%	2.05	%
Other	0.93	%	0.97	%	1.21	%	1.39	%	1.31	%	1.02	%	1.33	%
Total borrowed funds	1.03	%	1.04	%	1.09	%	1.02	%	1.06	%	1.05	%	1.59	%
Total rate on interest-bearing liabilities	0.14	%	0.16	%	0.19	%	0.21	%	0.26	%	0.16	%	0.56	%
Interest rate spread	2.22	%	2.24	%	2.21	%	2.25	%	2.31	%	2.22	%	2.42	%
Benefit from use of noninterest bearing sources (c)	0.05	%	0.05	%	0.06	%	0.07	%	0.08	%	0.06	%	0.15	%
Net interest margin	2.27	%	2.29	%	2.27	%	2.32	%	2.39	%	2.28	%	2.57	%

(a)Results reflect the BBVA acquisition beginning in the month of June 2021.

(b)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 September 30, 2021, June 30, 2021, March 31, 2021, December 31, 2020 and September 30, 2020 were $22 million, $15 million, $15 million, $17 million and $17 million, respectively. The taxable-equivalent adjustments to net interest income for the nine months ended September 30, 2021 and September 30, 2020 were $52 million and $58 million, respectively.

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


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 5


Table 5: Per Share Related Information (Unaudited)
	Three months ended										Nine months ended
	September 30		June 30		March 31		December 31		September 30		September 30		September 30
In millions, except per share data	2021		2021		2021		2020		2020		2021		2020
Basic
Net income from continuing operations	$	1,490	$	1,103	$	1,826	$	1,456	$	1,532	$	4,419	$	1,547
Less:
Net income attributable to noncontrolling interests	16		12		10		14		13		38		27
Preferred stock dividends	57		48		57		48		63		162		181
Preferred stock discount accretion and redemptions	1		1		1		1		1		3		3
Net income from continuing operations attributable to common shareholders	1,416		1,042		1,758		1,393		1,455		4,216		1,336
Less: Dividends and undistributed earnings allocated to nonvested restricted shares	8		5		8		6		8		21		7
Net income from continuing operations attributable to basic common shareholders	$	1,408	$	1,037	$	1,750	$	1,387	$	1,447	$	4,195	$	1,329
Net income from discontinued operations attributable to common shareholders													$	4,555
Less: Undistributed earnings allocated to nonvested restricted shares													22
Net income from discontinued operations attributable to basic common shareholders													$	4,533
Basic weighted-average common shares outstanding	426		427		426		425		426		426		427
Basic earnings per common share from continuing operations (a)	$	3.31	$	2.43	$	4.11	$	3.26	$	3.40	$	9.84	$	3.11
Basic earnings per common share from discontinued operations (a)													$	10.61
Basic earnings per common share	$	3.31	$	2.43	$	4.11	$	3.26	$	3.40	$	9.84	$	13.73
Diluted
Net income from continuing operations attributable to diluted common shareholder	$	1,408	$	1,037	$	1,750	$	1,387	$	1,447	$	4,195	$	1,329
Net income from discontinued operations attributable to basic common shareholders													$	4,533
Less: Impact of earnings per share dilution from discontinued operations													2
Net income from discontinued operations attributable to diluted common shareholders													$	4,531
Basic weighted-average common shares outstanding	426		427		426		425		426		426		427
Dilutive potential common shares							1				1		1
Diluted weighted-average common shares outstanding	426		427		426		426		426		427		428
Diluted earnings per common share from continuing operations (a)	$	3.30	$	2.43	$	4.10	$	3.26	$	3.39	$	9.83	$	3.11
Diluted earnings per common share from discontinued operations (a)													$	10.59
Diluted earnings per common share	$	3.30	$	2.43	$	4.10	$	3.26	$	3.39	$	9.83	$	13.70

(a)Dividends are payable quarterly other than Series R and Series S preferred stock, which are payable semiannually. On September 13, 2021, PNC issued 1,500,000 depositary shares of Series T preferred stock with a $1 par value. Beginning on December 15, dividends will be paid on the Series T on a quarterly basis (March 15, June 15, September 15 and December 15 of each year).


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 6

Table 6: Details of Loans (Unaudited)


	September 30		June 30		March 31		December 31		September 30
In millions	2021 (a)		2021 (a)		2021		2020		2020
Commercial









Commercial and industrial	$	152,735	$	155,300	$	129,798	$	132,073	$	137,187
Commercial real estate	36,195		37,964		28,319		28,716		29,028
Equipment lease financing	6,257		6,376		6,389		6,414		6,479
Total commercial	195,187		199,640		164,506		167,203		172,694
Consumer
Residential real estate	38,214		36,846		22,418		22,560		22,886
Home equity	24,479		25,174		23,493		24,088		24,539
Automobile	17,265		17,551		13,584		14,218		14,977
Credit card	6,466		6,528		5,675		6,215		6,303
Education	2,653		2,726		2,842		2,946		3,051
Other consumer	5,966		6,239		4,495		4,698		4,829
Total consumer	95,043		95,064		72,507		74,725		76,585
Total loans	$	290,230	$	294,704	$	237,013	$	241,928	$	249,279

(a)Includes $55.6 billion of loans at September 30, 2021, $34.7 billion in the commercial portfolio and $20.9 billion in the consumer portfolio, attributable to BBVA. Comparable amounts at June 30, 2021 totaled $60.5 billion, with $38.5 billion and $22.0 billion in the commercial and consumer portfolios, respectively. Our second quarter 2021 Form 10-Q included additional information on the June 1, 2021 acquisition of BBVA.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 7

Allowance for Credit Losses (Unaudited)

Table 7: Change in Allowance for Loan and Lease Losses


	Three months ended															Nine months ended
	September 30			June 30			March 31			December 31			September 30			September 30			September 30
Dollars in millions	2021			2021			2021			2020			2020			2021			2020
Allowance for loan and lease losses
Beginning balance	$	5,730		$	4,714		$	5,361		$	5,751		$	5,928		$	5,361		$	2,742
Adoption of ASU 2016-03 (a)																			463
Acquisition PCD reserves	(59)			1,115												1,056
Gross charge-offs:
Commercial and industrial	(46)			(245)			(59)			(133)			(59)			(350)			(249)
Commercial real estate	(1)			(28)			(5)			(1)			(1)			(34)			(1)
Equipment lease financing	(3)			(1)			(5)			(4)			(4)			(9)			(19)
Residential real estate	(4)			(3)			(4)			(6)			(2)			(11)			(4)
Home equity	(2)			(7)			(7)			(11)			(12)			(16)			(31)
Automobile	(33)			(35)			(52)			(55)			(57)			(120)			(210)
Credit card	(62)			(65)			(69)			(72)			(74)			(196)			(228)
Education	(3)			(3)			(5)			(3)			(3)			(11)			(13)
Other consumer	(52)			(41)			(37)			(42)			(35)			(130)			(110)
Total gross charge-offs	(206)			(428)			(243)			(327)			(247)			(877)			(865)
Recoveries:
Commercial and industrial	25			29			14			23			21			68			52
Commercial real estate	2			2			1			3			2			5			6
Equipment lease financing	2			3			3			3			3			8			7
Residential real estate	9			6			5			4			4			20			12
Home equity	25			21			17			17			15			63			44
Automobile	38			41			38			33			31			117			95
Credit card	13			11			12			9			9			36			26
Education	2			2			2			2			2			6			6
Other consumer	9			7			5			4			5			21			14
Total recoveries	125			122			97			98			92			344			262
Net (charge-offs) / recoveries:
Commercial and industrial	(21)			(216)			(45)			(110)			(38)			(282)			(197)
Commercial real estate	1			(26)			(4)			2			1			(29)			5
Equipment lease financing	(1)			2			(2)			(1)			(1)			(1)			(12)
Residential real estate	5			3			1			(2)			2			9			8
Home equity	23			14			10			6			3			47			13
Automobile	5			6			(14)			(22)			(26)			(3)			(115)
Credit card	(49)			(54)			(57)			(63)			(65)			(160)			(202)
Education	(1)			(1)			(3)			(1)			(1)			(5)			(7)
Other consumer	(43)			(34)			(32)			(38)			(30)			(109)			(96)
Total net (charge-offs) (b)	(81)			(306)			(146)			(229)			(155)			(533)			(603)
Provision for (recapture of) credit losses (c)	(229)			206			(502)			(164)			(23)			(525)			3,149
Other	(6)			1			1			3			1			(4)
Ending balance	$	5,355		$	5,730		$	4,714		$	5,361		$	5,751		$	5,355		$	5,751
Supplemental Information
Net charge-offs
Commercial net charge-offs	$	(21)		$	(240)		$	(51)		$	(109)		$	(38)		$	(312)		$	(204)
Consumer net charge-offs	(60)			(66)			(95)			(120)			(117)			(221)			(399)
Total net charge-offs (b)	$	(81)		$	(306)		$	(146)		$	(229)		$	(155)		$	(533)		$	(603)
Net charge-offs to average loans (annualized)	0.11		%	0.48		%	0.25		%	0.37		%	0.24		%	0.27		%	0.32		%
Commercial	0.04		%	0.55		%	0.13		%	0.25		%	0.09		%	0.23		%	0.15		%
Consumer	0.25		%	0.33		%	0.53		%	0.63		%	0.60		%	0.36		%	0.68		%

(a) Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2020, and our transition from an incurred loss methodology for our reserves to an expected credit loss methodology. Our 2020 Form 10-K included additional information related to our adoption of the CECL standard.

(b) Amounts for the three months ended June 30, 2021 included $248 million attributable to BBVA, primarily related to commercial industrial loans, which were largely the result of required purchase accounting treatment for the BBVA acquisition on June 1, 2021.

(c) See Table 8 for the components of the Provision for (recapture of) credit losses being reported on the Consolidated Income Statement.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 8

Allowance for Credit Losses (Unaudited) (Continued)

Table 8: Components of the Provision for (Recapture of) Credit Losses


	Three months ended										Nine months ended
	September 30		June 30		March 31		December 31		September 30		September 30		September 30
In millions	2021		2021 (a)		2021		2020		2020		2021 (a)		2020
Provision for (recapture of) credit losses
Loans and leases	$	(229)	$	206	$	(502)	$	(164)	$	(23)	(525)		$	3,149
Unfunded lending related commitments	1		92		(77)		(105)		27		16		192
Investment securities	25				26		11		39		51		69
Other financial assets			4		2		4		9		6		19
Total provision for (recapture of) credit losses	$	(203)	$	302	$	(551)	$	(254)	$	52	$	(452)	$	3,429

(a) Amounts include $1.0 billion of provision for credit losses that was recorded as part of the BBVA acquisition on June 1, 2021.

Table 9: Allowance for Credit Losses by Loan Class (a)


	September 30, 2021						June 30, 2021						September 30, 2020
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	$	2,173	$	152,735	1.42	%	$	2,282	$	155,300	1.47	%	$	2,735	$	137,187	1.99	%
Commercial real estate	1,312		36,195		3.62	%	1,404		37,964		3.70	%	630		29,028		2.17	%
Equipment lease financing	118		6,257		1.89	%	126		6,376		1.98	%	163		6,479		2.52	%
Total commercial	3,603		195,187		1.85	%	3,812		199,640		1.91	%	3,528		172,694		2.04	%
Consumer
Residential real estate	42		38,214		0.11	%	63		36,846		0.17	%	28		22,886		0.12	%
Home equity	167		24,479		0.68	%	188		25,174		0.75	%	349		24,539		1.42	%
Automobile	365		17,265		2.11	%	421		17,551		2.40	%	404		14,977		2.70	%
Credit card	701		6,466		10.84	%	711		6,528		10.89	%	891		6,303		14.14	%
Education	81		2,653		3.05	%	98		2,726		3.60	%	136		3,051		4.46	%
Other consumer	396		5,966		6.64	%	437		6,239		7.00	%	415		4,829		8.59	%
Total consumer	1,752		95,043		1.84	%	1,918		95,064		2.02	%	2,223		76,585		2.90	%
Total	5,355		$	290,230	1.85	%	5,730		$	294,704	1.94	%	5,751		$	249,279	2.31	%
Allowance for unfunded lending related commitments	646						645						689
Allowance for credit losses	$	6,001					$	6,375					$	6,440

Supplemental Information
Allowance for credit losses to total loans					2.07	%					2.16	%					2.58	%
Commercial					2.12	%					2.18	%					2.38	%
Consumer					1.96	%					2.14	%					3.04	%

(a) Excludes allowances for investment securities and other financial assets, which together totaled $162 million, $138 million and $98 million at September 30, 2021, June 30, 2021 and September 30, 2020, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 9

Details of Nonperforming Assets (Unaudited)

Table 10: Nonperforming Assets by Type


	September 30			June 30			March 31			December 31			September 30
Dollars in millions	2021 (a)			2021 (a)			2021			2020			2020
Nonperforming loans, including TDRs
Commercial
Commercial and industrial
Service providers	$	220		$	206		$	79		$	90		$	69
Manufacturing	62			65			55			81			80
Retail/wholesale trade	59			71			66			61			90
Health care	56			71			19			20			20
Real estate related (b)	49			78			48			95			140
Transportation and warehousing	21			18			18			20			14
Other industries	362			421			227			299			264
Total commercial and industrial	829			930			512			666			677
Commercial real estate	365			501			221			224			217
Equipment lease financing	10			15			16			33			21
Total commercial	1,204			1,446			749			923			915
Consumer (c)
Residential real estate	533			503			541			528			339
Home equity	592			626			656			645			639
Automobile	184			191			178			175			171
Credit card	7			7			7			8			13
Other consumer	8			6			7			7			8
Total consumer	1,324			1,333			1,389			1,363			1,170
Total nonperforming loans (d)	2,528			2,779			2,138			2,286			2,085
OREO and foreclosed assets	31			39			41			51			67
Total nonperforming assets	$	2,559		$	2,818		$	2,179		$	2,337		$	2,152
Nonperforming loans to total loans	0.87		%	0.94		%	0.90		%	0.94		%	0.84		%
Nonperforming assets to total loans, OREO and foreclosed assets	0.88		%	0.96		%	0.92		%	0.97		%	0.86		%
Nonperforming assets to total assets	0.46		%	0.51		%	0.46		%	0.50		%	0.47		%
Allowance for loan and lease losses to nonperforming loans	212		%	206		%	220		%	235		%	276		%

(a)Includes $715 million of nonperforming assets at September 30, 2021, $666 million in the commercial portfolio, $41 million in the consumer portfolio and $8 million of OREO and foreclosed assets, attributable to BBVA. Comparable amounts at June 30, 2021 totaled $880 million, $847 million, $24 million and $9 million, respectively. Our second quarter 2021 Form 10-Q included additional information on the June 1, 2021 acquisition of BBVA.

(b)Represents loans related to customers in the real estate and construction industries.

(c)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.

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

Table 11: Change in Nonperforming Assets


	July 1, 2021 -		April 1, 2021 -		January 1, 2021 -		October 1, 2020 -		July 1, 2020 -
In millions	September 30, 2021		June 30, 2021		March 31, 2021		December 31, 2020		September 30, 2020
Beginning balance	$	2,818	$	2,179	$	2,337	$	2,152	$	1,955
New nonperforming assets	365		207		249		586		512
Charge-offs and valuation adjustments	(71)		(61)		(70)		(97)		(75)
Principal activity, including paydowns and payoffs	(333)		(264)		(186)		(185)		(175)
Asset sales and transfers to loans held for sale	(30)		(15)		(86)		(14)		(20)
Returned to performing status	(190)		(108)		(65)		(105)		(45)
Acquired nonperforming assets (a)			880
Ending balance	$	2,559	$	2,818	$	2,179	$	2,337	$	2,152

(a)Represents nonperforming assets acquired as a part of the BBVA acquisition on June 1, 2021 and includes $871 million of loans and $9 million of OREO and foreclosed assets. Our second quarter 2021 Form 10-Q included additional information on the BBVA acquisition.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 10

Accruing Loans Past Due (Unaudited)

Pursuant to the interagency guidance issued in April 2020 and in connection with the credit reporting rules from the U.S. Coronavirus Aid, Relief and Economic Security Act (CARES Act), the delinquency status of loans modified due to COVID-19 related hardships are reported for all periods presented in alignment with the rules set forth for banks to report delinquency status to the credit agencies. These rules require that COVID-19 related loan modifications be reported as follows:

•if current at the time of modification, the loan remains current throughout the modification period,

•if delinquent at the time of modification and the borrower was not made current as part of the modification, the loan maintains its reported as delinquent status during the modification period, or

•if delinquent at the time of modification and the borrower was made current as part of the modification or became current during the modification period, the loan is reported as current.

As a result, certain loans modified due to COVID-19 related hardships are not being reported as past due for the periods presented based on the contractual terms of the loan, even where borrowers may not be making payments on their loans during the modification period. Our second quarter 2021 Form 10-Q included, and our third quarter 2021 Form 10-Q will include, additional information on COVID-19 related loan modifications.

Table 12: Accruing Loans Past Due 30 to 59 Days (a)



	September 30			June 30			March 31			December 31			September 30
Dollars in millions	2021 (b)			2021 (b)			2021			2020			2020
Commercial
Commercial and industrial	$	97		$	72		$	80		$	106		$	56
Commercial real estate	68			5			12			6			6
Equipment lease financing	5			3			21			31			7
Total commercial	170			80			113			143			69
Consumer
Residential real estate
Non government insured	128			124			61			89			99
Government insured	81			88			101			92			89
Home equity	45			44			43			50			48
Automobile	114			98			76			134			116
Credit card	42			37			31			43			44
Education
Non government insured	5			5			6			5			6
Government insured	40			41			43			50			51
Other consumer	34			31			11			14			17
Total consumer	489			468			372			477			470
Total	$	659		$	548		$	485		$	620		$	539
Supplemental Information
Total accruing loans past due 30-59 days to total loans	0.23		%	0.19		%	0.20		%	0.26		%	0.22		%
Commercial	0.09		%	0.04		%	0.07		%	0.09		%	0.04		%
Consumer	0.51		%	0.49		%	0.51		%	0.64		%	0.61		%

(a)Excludes loans held for sale.

(b)Includes $220 million of accruing loans 30-59 days past due at September 30, 2021, $98 million in the commercial portfolio and $122 million in the consumer portfolio, attributable to BBVA. Comparable amounts at June 30, 2021 were $141 million, $30 million and $111 million, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 11

Accruing Loans Past Due (Unaudited) (Continued)

Table 13: Accruing Loans Past Due 60 to 89 Days (a)


	September 30			June 30			March 31			December 31			September 30
Dollars in millions	2021 (b)			2021 (b)			2021			2020			2020
Commercial
Commercial and industrial	$	50		$	27		$	13		$	26		$	37
Commercial real estate	2			3			1			1			6
Equipment lease financing	4			4			1			5			4
Total commercial	56			34			15			32			47
Consumer
Residential real estate
Non government insured	35			30			13			16			22
Government insured	45			52			60			62			58
Home equity	18			17			20			21			22
Automobile	23			20			19			34			32
Credit card	27			24			24			30			33
Education
Non government insured	3			2			3			2			2
Government insured	23			20			22			27			24
Other consumer	15			16			6			10			11
Total consumer	189			181			167			202			204
Total	$	245		$	215		$	182		$	234		$	251
Supplemental Information
Total accruing loans past due 60-89 days to total loans	0.08		%	0.07		%	0.08		%	0.10		%	0.10		%
Commercial	0.03		%	0.02		%	0.01		%	0.02		%	0.03		%
Consumer	0.20		%	0.19		%	0.23		%	0.27		%	0.27		%

(a)Excludes loans held for sale.

(b)Includes $80 million of accruing loans 60-89 days past due at September 30, 2021, $26 million in the commercial portfolio and $54 million in the consumer portfolio, attributable to BBVA. Comparable amounts at June 30, 2021 were $56 million, $10 million and $46 million, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 12

Accruing Loans Past Due (Unaudited) (Continued)

Table 14: Accruing Loans Past Due 90 Days or More (a)


	September 30			June 30			March 31			December 31			September 30
Dollars in millions	2021 (b)			2021 (b)			2021			2020			2020
Commercial
Commercial and industrial	$	56		$	45		$	63		$	30		$	36
Commercial real estate	11			2
Total commercial	67			47			63			30			36
Consumer
Residential real estate
Non government insured	28			40			17			27			28
Government insured	268			297			258			292			241
Automobile	4			3			6			12			12
Credit card	53			59			52			60			60
Education
Non government insured	1			1			2			2			1
Government insured	60			66			74			75			62
Other consumer	11			14			7			11			8
Total consumer	425			480			416			479			412
Total	$	492		$	527		$	479		$	509		$	448
Supplemental Information
Total accruing loans past due 90 days or more to total loans	0.17		%	0.18		%	0.20		%	0.21		%	0.18		%
Commercial	0.03		%	0.02		%	0.04		%	0.02		%	0.02		%
Consumer	0.45		%	0.50		%	0.57		%	0.64		%	0.54		%
Total accruing loans past due	$	1,396		$	1,290		$	1,146		$	1,363		$	1,238
Commercial	$	293		$	161		$	191		$	205		$	152
Consumer	$	1,103		$	1,129		$	955		$	1,158		$	1,086
Total accruing loans past due to total loans	0.48		%	0.44		%	0.48		%	0.56		%	0.50		%
Commercial	0.15		%	0.08		%	0.12		%	0.12		%	0.09		%
Consumer	1.16		%	1.19		%	1.32		%	1.55		%	1.42		%

(a)Excludes loans held for sale.

(b)Includes $72 million of accruing loans 90 days or more past due at September 30, 2021, $6 million in the commercial portfolio and $66 million in the consumer portfolio, attributable to BBVA. Comparable amounts at June 30, 2021 were $94 million, $7 million and $87 million, respectively.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 13

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. Our customers are serviced through our branch network, ATMs, call centers, online banking and mobile channels. The branch network is located primarily in markets across the Mid-Atlantic, Midwest, Southeast and Southwest. Our national expansion strategy is designed to grow customers with digitally-led banking and a thin branch network in markets outside of our existing retail branch network. Deposit products include checking, savings and money market accounts and certificates of deposit. 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, and capital markets-related 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 payables, receivables, deposit and account services, liquidity and investments, and online and mobile banking products and services to our clients. Capital markets-related products and services include foreign exchange, derivatives, fixed income, securities underwriting, loan syndications, mergers and acquisitions advisory and equity capital markets advisory related services. 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 comprised of two distinct 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, and trust management and administration. In addition, multi-generational family planning services are also provided to ultra high net worth individuals and 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, private real estate, 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 15: Period End Employees


	September 30	June 30	March 31	December 31	September 30
	2021	2021	2021	2020	2020
Full-time employees
Retail Banking	33,188	33,471	27,690	27,621	27,808
Other full-time employees	25,442	25,512	22,281	21,928	21,997
Total full-time employees	58,630	58,983	49,971	49,549	49,805
Part-time employees
Retail Banking	1,616	1,821	1,697	1,611	1,593
Other part-time employees	94	431	101	97	104
Total part-time employees	1,710	2,252	1,798	1,708	1,697
Total	60,340	61,235	51,769	51,257	51,502


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 14

Table 16: Summary of Business Segment Net Income and Revenue (Unaudited) (a)


	Three months ended										Nine months ended
	September 30		June 30		March 31		December 31		September 30		September 30		September 30
In millions	2021		2021		2021		2020		2020		2021		2020
Income
Retail Banking	$	447	$	232	$	607	$	336	$	530	$	1,286	$	508
Corporate & Institutional Banking	1,123		809		1,058		992		670		2,990		682
Asset Management Group	114		87		99		82		91		300		173
Other	(210)		(37)		52		32		228		(195)		157
Net income from continuing operations excluding noncontrolling interest	$	1,474	$	1,091	$	1,816	$	1,442	$	1,519	$	4,381	$	1,520

Revenue
Retail Banking	$	2,375	$	2,203	$	2,016	$	1,853	$	2,056	$	6,594	$	6,275
Corporate & Institutional Banking	2,306		1,959		1,808		1,913		1,748		6,073		5,198
Asset Management Group	397		356		322		316		310		1,075		895
Other	119		149		74		126		167		342		325
Total revenue	$	5,197	$	4,667	$	4,220	$	4,208	$	4,281	$	14,084	$	12,693

(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.

Our third quarter 2021 business segment results reflect the full quarter benefit of BBVA's business operations, and our second quarter 2021 results reflect the impact of BBVA business operations for the month of June. Period end information presented includes BBVA's balances at both September 30, 2021 and June 30, 2021. Until the conversion of bank systems and branches on October 12, 2021, PNC Bank and BBVA customers were served through their respective PNC Bank and BBVA USA branches, websites and mobile apps, financial advisors and relationship managers. Upon conversion, there will be changes in the segmentation of BBVA USA customers as we integrate data to PNC applications, finalize the review of customer relationships and better align customers with PNC's products and services. These changes will be reflected in fourth quarter reporting.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 15

Table 17: Retail Banking (Unaudited) (a)


	Three months ended															Nine months ended
	September 30			June 30			March 31			December 31			September 30			September 30			September 30
Dollars in millions	2021			2021			2021			2020			2020			2021			2020
Income Statement
Net interest income	$	1,713		$	1,497		$	1,362		$	1,380		$	1,383		$	4,572		$	4,229
Noninterest income	662			706			654			473			673			2,022			2,046
Total revenue	2,375			2,203			2,016			1,853			2,056			6,594			6,275
Provision for (recapture of) credit losses	(113)			214			(257)			(81)			(157)			(156)			1,049
Noninterest expense	1,889			1,677			1,476			1,482			1,512			5,042			4,537
Pretax earnings	599			312			797			452			701			1,708			689
Income taxes	140			73			183			105			162			396			161
Noncontrolling interest	12			7			7			11			9			26			20
Earnings	$	447		$	232		$	607		$	336		$	530		$	1,286		$	508
Average Balance Sheet
Loans held for sale	$	1,583		$	1,405		$	891		$	672		$	700		$	1,296		$	769
Loans
Consumer
Residential real estate	$	30,702		$	21,653		$	17,468		$	18,042		$	18,435		$	23,323		$	18,215
Home equity	23,047			22,080			21,833			22,366			22,647			22,324			22,723
Automobile	17,377			14,888			13,890			14,536			15,573			15,398			16,449
Credit card	6,484			5,900			5,819			6,218			6,408			6,070			6,767
Education	2,712			2,812			2,938			3,027			3,119			2,820			3,226
Other consumer	2,892			2,175			1,898			2,086			2,262			2,326			2,417
Total consumer	83,214			69,508			63,846			66,275			68,444			72,261			69,797
Commercial	15,895			14,796			13,743			13,391			13,356			14,819			12,298
Total loans	$	99,109		$	84,304		$	77,589		$	79,666		$	81,800		$	87,080		$	82,095
Total assets	$	117,394		$	100,948		$	92,891		$	94,303		$	98,731		$	103,820		$	98,764
Deposits
Noninterest-bearing demand	$	65,985		$	54,260		$	44,845		$	43,818		$	43,752		$	55,107		$	38,390
Interest-bearing demand	62,414			59,329			54,269			50,702			49,274			58,700			46,501
Money market	40,471			29,998			24,198			24,112			23,816			31,639			23,210
Savings	81,950			79,518			75,180			72,041			70,236			78,907			67,000
Certificates of deposit	11,171			10,101			9,742			10,156			10,852			10,321			11,579
Total deposits	$	261,991		$	233,206		$	208,234		$	200,829		$	197,930		$	234,674		$	186,680
Performance Ratios
Return on average assets	1.51		%	0.92		%	2.65		%	1.41		%	2.13		%	1.66		%	0.69		%
Noninterest income to total revenue	28		%	32		%	32		%	26		%	33		%	31		%	33		%
Efficiency	80		%	76		%	73		%	80		%	74		%	76		%	72		%

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


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 16

Retail Banking (Unaudited) (Continued)


	Three months ended															Nine months ended
	September 30			June 30			March 31			December 31			September 30			September 30			September 30
Dollars in millions, except as noted	2021			2021			2021			2020			2020			2021			2020
Supplemental Noninterest Income Information
Consumer services	$	470		$	435		$	368		$	369		$	371		$	1,273		$	1,058
Residential mortgage	$	147		$	103		$	105		$	99		$	137		$	355		$	505
Service charges on deposits	$	158		$	129		$	119		$	133		$	118		$	406		$	364
Residential Mortgage Information
Residential mortgage servicing statistics (in billions, except as noted) (a)
Serviced portfolio balance (b)	$	139		$	145		$	117		$	121		$	119
Serviced portfolio acquisitions	$	2		$	33		$	7		$	12		$	8		$	42		$	21
MSR asset value (b)	$	1.1		$	1.1		$	1.0		$	0.7		$	0.6
MSR capitalization value (in basis points) (b)	81			77			83			56			50
Servicing income: (in millions)
Servicing fees, net (c)	$	18		$	(3)		$	5		$	13		$	25		$	20		$	105
Mortgage servicing rights valuation, net of economic hedge	$	24		$	24		$	14		$	(1)		$	17		$	62		$	138
Residential mortgage loan statistics
Loan origination volume (in billions)	$	7.4		$	6.5		$	4.3		$	3.7		$	4.0		$	18.2		$	11.4
Loan sale margin percentage	3.01		%	2.67		%	3.28		%	3.75		%	3.62		%	2.95		%	3.51		%
Percentage of originations represented by:
Purchase volume (d)	47		%	48		%	34		%	45		%	44		%	45		%	38		%
Refinance volume	53		%	52		%	66		%	55		%	56		%	55		%	62		%
Other Information (b)
Customer-related statistics (average) (e)
Non-teller deposit transactions (f)	66		%	65		%	66		%	66		%	67		%	66		%	63		%
Digital consumer customers (g)	80		%	80		%	79		%	77		%	75		%	80		%	73		%
Credit-related statistics
Nonperforming assets	$	1,220		$	1,245		$	1,229		$	1,211		$	1,077
Net charge-offs - loans and leases	$	82		$	79		$	108		$	136		$	125		$	269		$	433
Other statistics
ATMs	9,572			9,636			8,874			8,900			9,058
Branches (h)	2,712			2,724			2,137			2,162			2,207
Brokerage account client assets (in billions) (i)	$	76		$	83		$	61		$	59		$	55

(a)Represents mortgage loan servicing balances for third parties and the related income.

(b)Presented as of period end, except for average customer-related statistics and net charge-offs, which are both shown for the three and nine months ended.

(c)Servicing fees net of impact of decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan payments, prepayments, and loans that were paid down or paid off during the period.

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

(e)Represents PNC legacy only, statistics will be refreshed to include BBVA activity in fourth quarter reporting after the conversion of bank systems and branches is completed.

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

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

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

(i)Includes cash and money market balances.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 17

Table 18: Corporate & Institutional Banking (Unaudited) (a)


	Three months ended															Nine months ended
	September 30			June 30			March 31			December 31			September 30			September 30			September 30
Dollars in millions	2021			2021			2021			2020			2020			2021			2020
Income Statement
Net interest income	$	1,250		$	1,092		$	1,001		$	994		$	1,025		$	3,343		$	3,055
Noninterest income	1,056			867			807			919			723			2,730			2,143
Total revenue	2,306			1,959			1,808			1,913			1,748			6,073			5,198
Provision for (recapture of) credit losses	(99)			104			(282)			(166)			211			(277)			2,254
Noninterest expense	980			813			711			801			663			2,504			2,055
Pretax earnings	1,425			1,042			1,379			1,278			874			3,846			889
Income taxes	299			229			318			282			201			846			201
Noncontrolling interest	3			4			3			4			3			10			6
Earnings	$	1,123		$	809		$	1,058		$	992		$	670		$	2,990		$	682
Average Balance Sheet
Loans held for sale	$	541		$	564		$	691		$	1,039		$	904		$	598		$	669
Loans
Commercial
Commercial and industrial	$	134,128		$	121,232		$	114,944		$	120,297		$	125,187		$	123,505		$	127,149
Commercial real estate	35,368			30,118			27,182			27,509			27,511			30,919			27,070
Equipment lease financing	6,300			6,332			6,332			6,381			6,772			6,321			6,957
Total commercial	175,796			157,682			148,458			154,187			159,470			160,745			161,176
Consumer	20			13			9			10			11			14			9
Total loans	$	175,816		$	157,695		$	148,467		$	154,197		$	159,481		$	160,759		$	161,185
Total assets	$	202,268		$	181,770		$	170,531		$	177,792		$	183,266		$	184,964		$	185,001
Deposits
Noninterest-bearing demand	$	85,869		$	75,570		$	66,666		$	64,334		$	56,433		$	76,105		$	50,104
Interest-bearing demand	33,817			30,156			28,118			28,793			29,730			30,718			26,182
Money market	36,115			31,788			33,182			36,705			38,015			33,706			34,373
Other	7,315			7,499			8,368			8,928			8,956			7,723			8,789
Total deposits	$	163,116		$	145,013		$	136,334		$	138,760		$	133,134		$	148,252		$	119,448
Performance Ratios
Return on average assets	2.20		%	1.79		%	2.52		%	2.21		%	1.45		%	2.16		%	0.49		%
Noninterest income to total revenue	46		%	44		%	45		%	48		%	41		%	45		%	41		%
Efficiency	42		%	42		%	39		%	42		%	38		%	41		%	40		%
Other Information
Consolidated revenue from:
Treasury Management (b)	$	592		$	523		$	494		$	472		$	452		$	1,609		$	1,412
Capital Markets (b)	$	577		$	432		$	403		$	530		$	345		$	1,412		$	1,077
Commercial mortgage banking activities:
Commercial mortgage loans held for sale (c)	$	44		$	29		$	30		$	45		$	46		$	103		$	117
Commercial mortgage loan servicing income (d)	88			66			90			82			76			244			212
Commercial mortgage servicing rights valuation, net of economic hedge (e)	14			33			17			14			16			64			58
Total	$	146		$	128		$	137		$	141		$	138		$	411		$	387
MSR asset value (f)	$	703		$	682		$	702		$	569		$	515
Average loans by C&IB business
Corporate Banking	$	85,208		$	77,645		$	74,459		$	76,664		$	81,617		$	78,975		$	83,762
Real Estate	47,335			41,188			38,395			41,427			40,592			42,313			40,030
Business Credit	25,540			22,965			21,552			21,337			21,845			23,367			23,009
Commercial Banking	13,458			12,513			10,807			11,375			11,770			12,435			10,093
Other	4,275			3,384			3,254			3,394			3,657			3,669			4,291
Total average loans	$	175,816		$	157,695		$	148,467		$	154,197		$	159,481		$	160,759		$	161,185
Credit-related statistics
Nonperforming assets (f)	$	1,061		$	1,274		$	658		$	827		$	832
Net charge-offs - loans and leases	$	13		$	233		$	44		$	99		$	32		$	290		$	181

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

(b)Amounts are reported in net interest income and noninterest income.

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

(d)Represents net interest income and noninterest income (primarily in corporate service fees) from loan servicing net of reduction in commercial mortgage servicing rights due to amortization expense and payoffs. Commercial mortgage servicing rights valuation, net of economic hedge is shown separately.

(e)Amounts are reported in corporate service fees.

(f)Presented as of period end.


THE PNC FINANCIAL SERVICES GROUP, INC.						Page 18

Table 19: Asset Management Group (Unaudited) (a)


	Three months ended															Nine months ended
	September 30			June 30			March 31			December 31			September 30			September 30			September 30
Dollars in millions, except as noted	2021			2021			2021			2020			2020			2021			2020
Income Statement
Net interest income	$	141		$	112		$	93		$	91		$	89		$	346		$	266
Noninterest income	256			244			229			225			221			729			629
Total revenue	397			356			322			316			310			1,075			895
Provision for (recapture of) credit losses	(6)			23			(9)			(2)			(19)			8			23
Noninterest expense	255			219			202			211			211			676			647
Pretax earnings	148			114			129			107			118			391			225
Income taxes	34			27			30			25			27			91			52
Earnings	$	114		$	87		$	99		$	82		$	91		$	300		$	173
Average Balance Sheet
Loans
Consumer
Residential real estate	$	5,727		$	4,439		$	3,635		$	3,326		$	2,976		$	4,608		$	2,667
Other consumer	4,544			4,190			4,008			4,077			4,065			4,249			4,031
Total consumer	10,271			8,629			7,643			7,403			7,041			8,857			6,698
Commercial	2,693			1,415			756			774			810			1,629			849
Total loans	$	12,964		$	10,044		$	8,399		$	8,177		$	7,851		$	10,486		$	7,547
Total assets	$	13,805		$	10,640		$	8,873		$	8,615		$	8,361		$	11,124		$	8,041
Deposits
Noninterest-bearing demand	$	4,332		$	2,537		$	1,754		$	1,689		$	1,692		$	2,884		$	1,528
Interest-bearing demand	10,200			9,477			9,104			8,404			8,101			9,597			7,566
Money market	6,193			3,066			1,520			1,606			1,542			3,610			1,616
Savings	7,729			7,789			7,747			7,388			7,243			7,755			7,279
Other	862			562			454			482			554			628			707
Total deposits	$	29,316		$	23,431		$	20,579		$	19,569		$	19,132		$	24,474		$	18,696
Performance Ratios
Return on average assets	3.28		%	3.28		%	4.52		%	3.78		%	4.32		%	3.61		%	2.88		%
Noninterest income to total revenue	64		%	69		%	71		%	71		%	71		%	68		%	70		%
Efficiency	64		%	62		%	63		%	67		%	68		%	63		%	72		%
Other Information
Nonperforming assets (b)	$	80		$	85		$	68		$	66		$	39
Net charge-offs (recoveries) - loans and leases	$	(1)		$	2					$	1		$	1		$	1
Brokerage account client assets (in billions) (b)	$	5		$	5
Client Assets Under Administration (in billions) (b) (c)
Discretionary client assets under management	$	183		$	183		$	173		$	170		$	158
Nondiscretionary client assets under administration	170			172			161			154			142
Total	$	353		$	355		$	334		$	324		$	300
Discretionary client assets under management
Personal	$	117		$	119		$	110		$	108		$	99
Institutional	66			64			63			62			59
Total	$	183		$	183		$	173		$	170		$	158

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

(b)As of period end.

(c)Excludes brokerage account client assets.


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Glossary of Terms

2019 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).

Adjusted average total assets - Primarily consisted 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).

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).

BBVA – BBVA USA Bancshares, Inc.

BBVA, S.A. – Banco Bilbao Vizcaya Argentaria, S.A.

BBVA USA – BBVA USA, the Alabama-chartered bank subsidiary of BBVA USA Bancshares, Inc.

BlackRock – BlackRock, Inc.

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.


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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; 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.

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.

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, including TDRs which have not returned to performing status. 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.

Purchased credit deteriorated assets (PCD) - Acquired loans or debt securities that, at acquisition, are determined to have experienced a more-than-insignificant deterioration in credit quality since origination or issuance.

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.

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. 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


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interest income earned on other taxable investments. This adjustment is not permitted under GAAP on the Consolidated Income Statement.

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

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.

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.