PNC Reports 3Q Net Income of $1.1 Billion

PITTSBURGH — PNC Financial Services Group today reported third-quarter net income of $1.126 billion, or $2.16 per diluted common share. 

This compares to the $1.097 billion in net income, or $2.10 per diluted common share, during the second quarter and $1.006 billion in net income, or $1.84 per diluted common share, for the third quarter of 2016.

The August quarterly cash dividend of 75 cents per share payable Nov. 5 to shareholders of record Oct. 17 reflects a 36% increase.

In a prepared statement, PNC chairman, president and CEO William Demchak, said, “Net interest income increased and our margin expanded as we benefited from higher short-term rates and our well-positioned balance sheet. We continue to focus on disciplined expense management even as we invest in our businesses, and we believe we have additional opportunities to drive further growth and efficiency over the long term.”

Highlights PNC cited include:

  • Total revenue growth rose $65 million, or 2%, from the second quarter to $4.1 billion.
  • Noninterest expense of $2.5 billion decreased $23 million, or 1%, as expenses were well managed.
  • Provision for credit losses increased $32 million to $130 million and included $10 million related to Hurricanes Harvey and Irma. Loan growth and seasonal consumer loan credit trends contributed to the increase.
  • A return of capital to shareholders through PNC repurchasing 4.2 million common shares for $.5 billion.
  • Deposits increased $1.6 billion, or 1%, to $260.7 billion at Sept. 30,  compared with June 30, due to seasonal growth in commercial deposits.

Key financial ratios for the quarters ended Sept. 30, June 30, and Sept. 30, 2016:

  • Return on average assets, 1.20%, 1.19%, 1.10%.
  • Return on average common equity, 9.89%, 9.88%, 8.74%.
  • Net interest margin, 2.91%, 2.84%, 2.68%.
  • Efficiency, 60%, 61%, 63%.

Net interest income increased to $2.345 billion compared to $2.258 billion reported for the second quarter and $2.095 billion the year-ago quarter.

Noninterest income was $1.780 billion, compared to $1.802 billion the preceding quarter and $1.734 billion for the quarter ended Sept. 30, 2016, while noninterest expense (such as wages and benefits, rents, advertising and Federal Deposit Insurance Corp. premiums) was $2.456 billion, $2.479 billion and $2.394 billion respectively.

Total assets increased to $375.2 billion during the quarter.

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