1
Exhibit 99.1
CONTACTS:
MEDIA:
Jonathan Williams
(412) 762-4550
pubrela@pncmail.com
INVESTORS:
William H. Callihan
(412) 762-8257
invrela@pncmail.com
PNC BANK CORP. REPORTS STRONG FOURTH QUARTER,
LEADING TO RECORD EARNINGS FOR 1997
PITTSBURGH, Jan. 15, 1998 - PNC Bank Corp. (NYSE: PNC) today
reported strong fourth quarter 1997 earnings of $265 million or $0.85 per
diluted share and record full year earnings of $1.052 billion or $3.28 per
diluted share. Comparable 1996 results were $272 million or $0.79 per diluted
share for the fourth quarter and $992 million or $2.88 per diluted share for the
year.
Return on average common shareholders' equity was 20.28% for the
fourth quarter and 20.01% for the year compared with 18.58% and 17.18%,
respectively for the prior year. Return on average assets was 1.49% for both the
last quarter and full year compared with 1.56% and 1.40% for the respective 1996
periods.
"Our record performance reflects solid revenue growth," said Thomas
H. O'Brien, chairman and chief executive officer. "Our aggressive investments
over the past several years in fee-based businesses such as Asset Management,
Treasury Management, Capital Markets and Mutual Fund Servicing have generated
significant contributions to our performance. Noninterest revenues represented
more than 44% of total revenues in the fourth quarter and we expect that
relative contribution to increase to over 50% by 2000."
2
PNC Bank Corp. Reports Strong Fourth Quarter,
Leading To Record Earnings For 1997 -- Page 2
HIGHLIGHTS
o Revenue increased 12% in the year-to-year comparison.
o Noninterest income grew $413 million led by fee-based revenue growth
of 21%.
o The relationship of noninterest income to total revenue was 42% for
1997 and increased to 44% for the fourth quarter.
o The net interest margin widened 11 basis points to 3.94% during 1997.
o Significant investments were made in national consumer businesses,
including the AAA initiative which is expected to become profitable
in the fourth quarter of 1998.
o Asset quality improved significantly. Nonperforming assets declined
15% from the third quarter and 27% since last year and finished the
year at 0.61% of loans and foreclosed assets. Net charge-offs for
1997 were 0.51% of average loans.
o Continued aggressive reduction in the securities portfolio and
related wholesale funding while maintaining a balance sheet that is
essentially neutral to changes in interest rates.
o Capital management activities for 1997 included reducing the
securities portfolio to $8.5 billion or 12.8% of earning assets and
repurchasing 29.3 million common shares or 9.0% of shares
outstanding.
INCOME STATEMENT REVIEW
Taxable-equivalent net interest income was $2.524 billion for 1997,
a $46 million increase over 1996. The net interest margin widened to 3.94%
compared with 3.83% in the prior year primarily resulting from a higher-yielding
earning asset mix.
The provision for credit losses was $70 million for 1997. No
provision was recorded in the prior year.
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3
PNC Bank Corp. Reports Strong Fourth Quarter,
Leading To Record Earnings For 1997 -- Page 3
Noninterest income totaled $1.808 billion in 1997 and represented
42% of total revenue compared with $1.395 billion and 36%, respectively, in
1996. Growth in investment advisory, private banking and mutual fund servicing
contributed to a $106 million or 21% increase in asset management fees. Managed
assets increased to approximately $137 billion at Dec. 31, 1997 compared with
$109 billion a year ago. Service fees increased $146 million or 26% primarily
from growth in credit card, corporate finance, insurance, deposit, treasury
management and consumer services.
Mortgage banking revenue grew primarily due to higher income from
securitization activities. Mortgage originations totaled $6.1 billion in 1997
compared with $5.6 billion a year ago. At Dec. 31, 1997, the corporation
serviced approximately $40.7 billion of mortgages, including $31.7 billion
serviced for others.
Other noninterest income increased $132 million in the comparison
primarily due to higher venture capital and asset securitization income.
Noninterest expense increased $303 million to $2.615 billion in 1997
largely due to $187 million of incremental costs associated with AAA and credit
card-related initiatives. The remaining increase was attributable to higher
incentive compensation commensurate with growth in fee-based revenue and the
cost of trust preferred capital securities. The efficiency ratio was 59.4% for
1997 compared with 59.6% a year ago.
BALANCE SHEET REVIEW
Total assets were $75.1 billion at Dec. 31, 1997. Average earning
assets declined $708 million during the year to $64.0 billion as loan growth was
more than offset by securities portfolio reductions. Average loans grew 7.7% to
$52.9 billion, a $3.8 billion increase from the prior year. Loans represented
82.6% of average earning assets compared with 75.9% a year ago. Growth in credit
cards, residential mortgages and middle market commercial loans more than offset
downsizing of the indirect automobile lending portfolio and the impact of loan
securitizations. Since 1994, the corporation has aggressively downsized the
securities portfolio and related wholesale funding. As a result, average
securities have been reduced to $8.8 billion or 13.7% of average earning assets.
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4
PNC Bank Corp. Reports Strong Fourth Quarter,
Leading To Record Earnings For 1997 -- Page 4
Average interest-bearing funding was substantially unchanged at $53.5
billion in 1997. Deposits represented 63.0% of total sources of funds for 1997
compared with 63.7% a year ago.
Shareholders' equity totaled $5.4 billion at Dec. 31, 1997. The
leverage ratio was 7.3% and Tier I and total risk-based capital ratios are
estimated to be 7.4% and 11.0%, respectively. During 1997, the corporation
repurchased 29.3 million common shares. During the fourth quarter, the board of
directors approved a 5.4% increase in the quarterly common dividend to $0.39 per
share.
The ratio of nonperforming assets to total loans and foreclosed assets
declined to 0.61% at Dec. 31, 1997, compared with 0.73% at Sept. 30, 1997, and
0.88% a year ago. Nonperforming assets declined to $333 million at Dec. 31,
1997, compared with $394 million at Sept. 30, 1997, and $459 million at Dec. 31,
1996.
The allowance for credit losses was $972 million at Dec. 31, 1997, and
represented 352% of nonperforming loans compared with 334% a year ago. Net
charge-offs were $272 million or 0.51% of average loans in 1997 compared with
$164 million and 0.33%, respectively, a year ago. The increase was primarily
associated with higher credit card outstandings.
PNC Bank Corp., headquartered in Pittsburgh, is one of the largest
diversified financial services organizations in the United States. Its major
businesses include consumer banking, corporate banking, private banking,
mortgage banking, secured lending and asset management.
Visit PNC Bank on the World Wide Web at http://www.pncbank.com
Our SEC reports, accessible on our website, identify factors that can affect
forward looking statements.
[TABULAR MATERIAL FOLLOWS]
5
PNC BANK CORP. AND SUBSIDIARIES Page 5
Consolidated Financial Highlights
Three months ended
December 31 Year ended December 31
1997 1996 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL PERFORMANCE (in thousands, except per share data)
Revenue
Net interest income (taxable-equivalent basis) $638,912 $625,637 $2,524,207 $2,478,609
Noninterest income 503,993 388,579 1,808,166 1,395,100
Total revenue 1,142,905 1,014,216 4,332,373 3,873,709
Net income 265,489 271,903 1,052,468 992,226
Per common share
Diluted earnings .85 .79 3.28 2.88
Cash dividends declared .39 .37 1.50 1.42
SELECTED RATIOS
Return on
Average common shareholders' equity 20.28% 18.58% 20.01% 17.18%
Average assets 1.49 1.56 1.49 1.40
Net interest margin 3.95 3.92 3.94 3.83
After-tax profit margin 23.23 26.81 24.29 25.61
Efficiency ratio (excluding distributions on capital securities) 60.20 57.69 59.36 59.64
Net charge-offs to average loans .59 .45 .51 .33
December 31 September 30 June 30 March 31 December 31
1997 1997 1997 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
BALANCE SHEET DATA (in millions)
Assets $75,120 $71,828 $71,973 $71,166 $73,260
Earning assets 66,688 64,208 64,297 64,255 65,439
Loans, net of unearned income 54,245 53,651 53,497 52,575 51,798
Securities 8,522 8,000 8,396 9,593 11,917
Deposits 47,649 44,788 45,216 44,902 45,676
Borrowed funds 19,622 19,052 19,066 18,547 19,604
Shareholders' equity 5,384 5,476 5,384 5,478 5,869
Common shareholders' equity 5,069 5,161 5,068 5,162 5,553
CAPITAL RATIOS
Leverage 7.27% 7.46% 7.35% 7.17% 7.70%
Common shareholders' equity to assets 6.75 7.18 7.04 7.25 7.58
ASSET QUALITY RATIOS
Nonperforming assets to loans and foreclosed assets .61 .73 .83 .82 .88
Allowance for credit losses to loans 1.79 1.91 2.01 2.13 2.25
Allowance for credit losses to nonperforming loans 351.79 324.25 310.34 346.11 334.40
Book value per common share $16.87 $16.92 $16.51 $16.45 $17.13
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PNC BANK CORP. AND SUBSIDIARIES Page 6
Consolidated Statement of Income
Three months ended
December 31 Year ended December 31
-------------------------- --------------------------
In thousands, except per share data 1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
INTEREST INCOME
Loans and fees on loans $1,117,551 $1,011,871 $4,353,744 $3,943,586
Securities 119,366 181,264 539,953 858,686
Other 44,426 30,490 157,306 136,463
----------------------------------------------------
Total interest income 1,281,343 1,223,625 5,051,003 4,938,735
INTEREST EXPENSE
Deposits 369,572 354,985 1,456,587 1,428,771
Borrowed funds 279,570 250,906 1,099,198 1,065,663
----------------------------------------------------
Total interest expense 649,142 605,891 2,555,785 2,494,434
----------------------------------------------------
Net interest income 632,201 617,734 2,495,218 2,444,301
Provision for credit losses 25,000 70,000
----------------------------------------------------
Net interest income less provision for credit losses 607,201 617,734 2,425,218 2,444,301
NONINTEREST INCOME
Asset management 166,409 129,048 602,804 496,739
Service fees 192,788 158,045 712,452 566,358
Mortgage banking 45,741 47,532 156,486 153,672
Other 77,621 46,399 287,851 156,207
----------------------------------------------------
Total noninterest income before net securities gains 482,559 381,024 1,759,593 1,372,976
Net securities gains 21,434 7,555 48,573 22,124
----------------------------------------------------
Total noninterest income 503,993 388,579 1,808,166 1,395,100
NONINTEREST EXPENSE
Staff expense 312,339 269,233 1,208,175 1,109,932
Net occupancy and equipment 97,611 92,955 369,380 368,649
Amortization 56,104 36,701 173,921 117,439
Other 222,014 186,210 820,171 714,439
Distributions on capital securities 13,123 1,391 43,138 1,391
----------------------------------------------------
Total noninterest expense 701,191 586,490 2,614,785 2,311,850
Income before income taxes 410,003 419,823 1,618,599 1,527,551
Applicable income taxes 144,514 147,920 566,131 535,325
----------------------------------------------------
Net income $265,489 $271,903 $1,052,468 $992,226
- -------------------------------------------------------------------------------------------------------------------------------
Net income applicable to common shareholders $261,675 $268,662 $1,037,324 $991,558
EARNINGS PER COMMON SHARE
Basic $.86 $.80 $3.33 $2.91
Diluted .85 .79 3.28 2.88
CASH DIVIDENDS DECLARED PER COMMON SHARE .39 .37 1.50 1.42
AVERAGE COMMON SHARES OUTSTANDING
Basic 303,207 332,266 310,147 338,568
Diluted 309,533 338,678 316,221 344,576
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PNC BANK CORP. AND SUBSIDIARIES Page 7
Details of Net Interest Income
Three months ended
NET INTEREST INCOME December 31 Year ended December 31
Taxable-equivalent basis -------------------------------------------------------
In thousands 1997 1996 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
Interest income
Loans $1,123,127 $1,017,982 $4,376,444 $3,969,159
Securities 120,395 183,013 545,936 867,209
Other interest-earning assets 44,532 30,533 157,612 136,675
---------------------------------------------------------
Total interest income 1,288,054 1,231,528 5,079,992 4,973,043
Interest expense
Deposits 369,572 354,985 1,456,587 1,428,771
Borrowed funds 279,570 250,906 1,099,198 1,065,663
---------------------------------------------------------
Total interest expense 649,142 605,891 2,555,785 2,494,434
---------------------------------------------------------
Net interest income $638,912 $625,637 $2,524,207 $2,478,609
- ------------------------------------------------------------------------------------------------------------------------------------
Taxable-equivalent basis December 31 September 30 June 30 March 31 December 31
Three months ended - in thousands 1997 1997 1997 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
Interest income
Loans $1,123,127 $1,107,250 $1,084,532 $1,061,535 $1,017,982
Securities 120,395 127,053 140,618 157,870 183,013
Other interest-earning assets 44,532 43,555 39,416 30,109 30,533
---------------------------------------------------------------------
Total interest income 1,288,054 1,277,858 1,264,566 1,249,514 1,231,528
Interest expense
Deposits 369,572 372,860 368,000 346,155 354,985
Borrowed funds 279,570 277,567 275,985 266,076 250,906
---------------------------------------------------------------------
Total interest expense 649,142 650,427 643,985 612,231 605,891
---------------------------------------------------------------------
Net interest income $638,912 $627,431 $620,581 $637,283 $625,637
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PNC BANK CORP. AND SUBSIDIARIES Page 8
Details of Net Interest Margin
Three months ended
December 31 Year ended December 31
NET INTEREST MARGIN -----------------------------------------------------
Taxable-equivalent basis 1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
Rates earned/paid
Yield on earning assets
Loans 8.27% 8.07% 8.27% 8.08%
Securities 6.19 6.32 6.22 6.40
Other interest-earning assets 6.68 6.84 6.75 6.64
----------------------------------------------------
Total yield on earning assets 7.96 7.71 7.93 7.68
Rate on interest-bearing liabilities
Deposits 4.23 4.05 4.18 4.06
Borrowed funds 5.91 5.79 5.91 5.82
----------------------------------------------------
Total rate on interest-bearing liabilities 4.82 4.62 4.78 4.66
----------------------------------------------------
Interest rate spread 3.14 3.09 3.15 3.02
Impact of noninterest-bearing sources .81 .83 .79 .81
----------------------------------------------------
Net interest margin 3.95% 3.92% 3.94% 3.83%
- -------------------------------------------------------------------------------------------------------------------------------
Taxable-equivalent basis December 31 September 30 June 30 March 31 December 31
Three months ended 1997 1997 1997 1997 1996
- --------------------------------------------------------------------------------------------------------------------------------
Rates earned/paid
Yield on earning assets
Loans 8.27% 8.23% 8.19% 8.20% 8.07%
Securities 6.19 6.17 6.21 6.27 6.32
Other interest-earning assets 6.68 6.83 6.76 6.68 6.84
----------------------------------------------------------------
Total yield on earning assets 7.96 7.92 7.85 7.86 7.71
Rate on interest-bearing liabilities
Deposits 4.23 4.23 4.18 4.06 4.05
Borrowed funds 5.91 5.92 5.88 5.76 5.79
----------------------------------------------------------------
Total rate on interest-bearing liabilities 4.82 4.82 4.77 4.66 4.62
----------------------------------------------------------------
Interest rate spread 3.14 3.10 3.08 3.20 3.09
Impact of noninterest-bearing sources .81 .79 .76 .78 .83
----------------------------------------------------------------
Net interest margin 3.95% 3.89% 3.84% 3.98% 3.92%
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PNC BANK CORP. AND SUBSIDIARIES Page 9
Details of Noninterest Income
Three months ended
December 31 Year ended December 31
NONINTEREST INCOME -----------------------------------------------------
In thousands 1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
Asset management
Asset management and trust $128,916 $97,588 $461,512 $377,854
Mutual fund servicing 37,493 31,460 141,292 118,885
----------------------------------------------------
Total asset management 166,409 129,048 602,804 496,739
Service fees
Deposit 78,408 77,571 317,489 289,596
Credit card and merchant services 28,802 14,903 93,158 29,759
Corporate finance and capital markets 27,194 16,449 83,356 65,615
Consumer 19,965 19,246 74,783 63,676
Brokerage 14,230 12,392 54,341 53,810
Insurance 10,543 8,706 39,769 30,062
Other 13,646 8,778 49,556 33,840
----------------------------------------------------
Total service fees 192,788 158,045 712,452 566,358
Mortgage banking
Servicing 30,503 30,064 116,231 118,906
Marketing 14,775 8,022 37,440 23,638
Sale of servicing 463 9,446 2,815 11,128
----------------------------------------------------
Total mortgage banking 45,741 47,532 156,486 153,672
Other 77,621 46,399 287,851 156,207
----------------------------------------------------
Total noninterest income before net securities gains 482,559 381,024 1,759,593 1,372,976
Net securities gains 21,434 7,555 48,573 22,124
----------------------------------------------------
Total $503,993 $388,579 $1,808,166 $1,395,100
- -------------------------------------------------------------------------------------------------------------------------------
December 31 September 30 June 30 March 31 December 31
Three months ended - in thousands 1997 1997 1997 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
Asset management
Asset management and trust $128,916 $115,197 $110,500 $106,899 $97,588
Mutual fund servicing 37,493 35,608 35,518 32,673 31,460
-----------------------------------------------------------------
Total asset management 166,409 150,805 146,018 139,572 129,048
Service fees
Deposit 78,408 78,406 79,817 80,858 77,571
Credit card and merchant services 28,802 23,292 21,960 19,104 14,903
Corporate finance and capital markets 27,194 18,480 21,090 16,592 16,449
Consumer 19,965 19,533 17,988 17,297 19,246
Brokerage 14,230 14,138 12,731 13,242 12,392
Insurance 10,543 10,421 9,659 9,146 8,706
Other 13,646 10,876 13,852 11,182 8,778
-----------------------------------------------------------------
Total service fees 192,788 175,146 177,097 167,421 158,045
Mortgage banking
Servicing 30,503 30,316 27,963 27,449 30,064
Marketing 14,775 15,552 3,692 3,421 8,022
Sale of servicing 463 683 494 1,175 9,446
-----------------------------------------------------------------
Total mortgage banking 45,741 46,551 32,149 32,045 47,532
Other 77,621 75,805 64,773 69,652 46,399
-----------------------------------------------------------------
Total noninterest income before net securities gains
(losses) 482,559 448,307 420,037 408,690 381,024
Net securities gains (losses) 21,434 (2,657) 13,370 16,426 7,555
-----------------------------------------------------------------
Total $503,993 $445,650 $433,407 $425,116 $388,579
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PNC BANK CORP. AND SUBSIDIARIES Page 10
Details of Noninterest Expense
Three months ended
December 31 Year ended December 31
NONINTEREST EXPENSE -----------------------------------------------------
In thousands 1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
Staff expense
Compensation $276,768 $234,690 $1,015,898 $929,626
Employee benefits 35,571 34,543 192,277 180,306
----------------------------------------------------
Total staff expense 312,339 269,233 1,208,175 1,109,932
Net occupancy 49,813 49,681 189,345 196,975
Equipment 47,798 43,274 180,035 171,674
Goodwill amortization 13,143 15,118 52,795 54,300
Other amortization 42,961 21,583 121,126 63,139
Taxes other than income 13,730 12,360 56,476 53,353
Distributions on capital securities 13,123 1,391 43,138 1,391
Other 208,284 173,850 763,695 661,086
----------------------------------------------------
Total $701,191 $586,490 $2,614,785 $2,311,850
- -------------------------------------------------------------------------------------------------------------------------------
December 31 September 30 June 30 March 31 December 31
Three months ended - in thousands 1997 1997 1997 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
Staff expense
Compensation $276,768 $250,833 $243,602 $244,695 $234,690
Employee benefits 35,571 48,141 50,559 58,006 34,543
-----------------------------------------------------------------
Total staff expense 312,339 298,974 294,161 302,701 269,233
Net occupancy 49,813 46,221 46,071 47,240 49,681
Equipment 47,798 44,483 45,710 42,044 43,274
Goodwill amortization 13,143 13,110 13,274 13,268 15,118
Other amortization 42,961 35,349 26,253 16,563 21,583
Taxes other than income 13,730 13,879 13,832 15,035 12,360
Distributions on capital securities 13,123 13,192 9,867 6,956 1,391
Other 208,284 173,350 189,664 192,397 173,850
-----------------------------------------------------------------
Total $701,191 $638,558 $638,832 $636,204 $586,490
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PNC BANK CORP. AND SUBSIDIARIES Page 11
Consolidated Balance Sheet
December 31 December 31
In millions 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
ASSETS
Cash and due from banks $4,303 $4,016
Short-term investments 1,526 774
Loans held for sale 2,324 941
Securities available for sale 8,522 11,917
Loans, net of unearned income of $412 and $385 54,245 51,798
Allowance for credit losses (972) (1,166)
-------------------------
Net loans 53,273 50,632
Other 5,172 4,980
-------------------------
Total assets $75,120 $73,260
-------------------------
LIABILITIES
Deposits
Noninterest-bearing $10,158 $10,937
Interest-bearing 37,491 34,739
-------------------------
Total deposits 47,649 45,676
Borrowed funds
Bank notes and senior debt 9,826 8,093
Federal funds purchased 3,632 3,933
Repurchase agreements 714 645
Other borrowed funds 3,753 5,576
Subordinated debt 1,697 1,357
-------------------------
Total borrowed funds 19,622 19,604
Other 1,815 1,761
-------------------------
Total liabilities 69,086 67,041
Mandatorily redeemable capital securities of subsidiary trusts 650 350
SHAREHOLDERS' EQUITY
Preferred stock 7 7
Common stock - $5 par value
Authorized $450,000,000 shares
Issued 348,447,600 and 345,154,238 shares 1,742 1,726
Capital surplus 1,042 939
Retained earnings 4,641 4,075
Deferred benefit expense (41) (60)
Net unrealized securities losses (23) (67)
Common stock held in treasury at cost: 48,017,641 and 21,036,195 shares (1,984) (751)
-------------------------
Total shareholders' equity 5,384 5,869
-------------------------
Total liabilities, capital securities and shareholders' equity $75,120 $73,260
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PNC BANK CORP. AND SUBSIDIARIES Page 12
Consolidated Average Balance Sheet Data
Three months ended
December 31 Year ended December 31
-----------------------------------------------------
In millions 1997 1996 1997 1996
- -------------------------------------------------------------------------------------------------------------------------------
ASSETS
Interest-earning assets
Securities $7,769 $11,569 $8,774 $13,550
Loans, net of unearned income
Consumer
Credit card 3,803 1,683 3,558 1,165
Other consumer 11,108 12,084 11,224 12,192
----------------------------------------------------
Total consumer 14,911 13,767 14,782 13,357
Residential mortgage 12,966 12,361 13,105 12,049
Commercial 19,838 18,122 19,089 17,727
Commercial real estate 4,067 4,092 4,060 4,186
Other 1,881 1,631 1,871 1,797
----------------------------------------------------
Total loans, net of unearned income 53,663 49,973 52,907 49,116
Other interest-earning assets 2,655 1,780 2,336 2,059
----------------------------------------------------
Total interest-earning assets 64,087 63,322 64,017 64,725
Noninterest-earning assets 6,782 6,214 6,627 6,082
----------------------------------------------------
Total assets $70,869 $69,536 $70,644 $70,807
----------------------------------------------------
LIABILITIES
Interest-bearing liabilities
Deposits $34,655 $34,829 $34,864 $35,217
Borrowed funds 18,624 17,110 18,594 18,314
----------------------------------------------------
Total interest-bearing liabilities 53,279 51,939 53,458 53,531
Noninterest-bearing deposits 9,925 10,003 9,670 9,900
Other 1,601 1,501 1,501 1,529
----------------------------------------------------
Total liabilities 64,805 63,443 64,629 64,960
Mandatorily redeemable capital securities of subsidiary trusts 650 76 537 19
SHAREHOLDERS' EQUITY 5,414 6,017 5,478 5,828
----------------------------------------------------
Total liabilities, capital securities and shareholders' equity $70,869 $69,536 $70,644 $70,807
----------------------------------------------------
COMMON SHAREHOLDERS' EQUITY $5,099 $5,727 $5,162 $5,742
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PNC BANK CORP. AND SUBSIDIARIES Page 13
Consolidated Balance Sheet Data
AVERAGE BALANCES December 31 September 30 June 30 March 31 December 31
Three months ended - in millions 1997 1997 1997 1997 1996
- --------------------------------------------------------------------------------------------------------------------------------
ASSETS
Interest-earning assets
Securities $7,769 $8,216 $9,055 $10,089 $11,569
Loans, net of unearned income
Consumer
Credit card 3,803 3,871 3,502 3,043 1,683
Other consumer 11,108 10,996 11,239 11,827 12,084
-----------------------------------------------------------------
Total consumer 14,911 14,867 14,741 14,870 13,767
Residential mortgage 12,966 13,503 13,164 12,781 12,361
Commercial 19,838 18,858 18,986 18,429 18,122
Commercial real estate 4,067 4,022 4,038 4,078 4,092
Other 1,881 1,952 1,884 1,764 1,631
-----------------------------------------------------------------
Total loans, net of unearned income 53,663 53,202 52,813 51,922 49,973
Other interest-earning assets 2,655 2,536 2,333 1,814 1,780
-----------------------------------------------------------------
Total interest-earning assets 64,087 63,954 64,201 63,825 63,322
Noninterest-earning assets 6,782 6,627 6,620 6,476 6,214
-----------------------------------------------------------------
Total assets $70,869 $70,581 $70,821 $70,301 $69,536
-----------------------------------------------------------------
LIABILITIES
Interest-bearing liabilities
Deposits $34,655 $34,952 $35,313 $34,533 $34,829
Borrowed funds 18,624 18,484 18,675 18,594 17,110
-----------------------------------------------------------------
Total interest-bearing liabilities 53,279 53,436 53,988 53,127 51,939
Noninterest-bearing deposits 9,925 9,654 9,501 9,600 10,003
Other 1,601 1,460 1,480 1,466 1,501
-----------------------------------------------------------------
Total liabilities 64,805 64,550 64,969 64,193 63,443
Mandatorily redeemable capital securities of subsidiary
trusts 650 650 492 350 76
SHAREHOLDERS' EQUITY 5,414 5,381 5,360 5,758 6,017
-----------------------------------------------------------------
Total liabilities, capital securities and shareholders'
equity $70,869 $70,581 $70,821 $70,301 $69,536
-----------------------------------------------------------------
COMMON SHAREHOLDERS' EQUITY $5,099 $5,066 $5,044 $5,442 $5,727
- --------------------------------------------------------------------------------------------------------------------------------
LOAN PORTFOLIO December 31 September 30 June 30 March 31 December 31
Period ended - in millions 1997 1997 1997 1997 1996
- --------------------------------------------------------------------------------------------------------------------------------
Consumer
Credit card $3,830 $3,861 $3,693 $3,345 $2,776
Other consumer 11,205 11,206 10,983 11,356 12,092
Residential mortgage 12,785 13,064 13,494 13,056 12,703
Commercial 19,989 19,536 19,266 19,020 18,588
Commercial real estate
Commercial mortgage 1,848 1,926 1,880 1,894 1,941
Real estate project 2,126 2,159 2,123 2,137 2,157
Other 2,874 2,281 2,450 2,154 1,926
-----------------------------------------------------------------
Total loans 54,657 54,033 53,889 52,962 52,183
Unearned income (412) (382) (392) (387) (385)
-----------------------------------------------------------------
Loans, net of unearned income $54,245 $53,651 $53,497 $52,575 $51,798
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PNC BANK CORP. AND SUBSIDIARIES Page 14
Asset Quality Data
LOAN PORTFOLIO December 31 September 30 June 30 March 31 December 31
Three months ended - in millions 1997 1997 1997 1997 1996
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Beginning balance $1,027 $1,075 $1,119 $1,166 $1,152
Charge-offs
Consumer
Credit card (54) (53) (55) (46) (23)
Other consumer (27) (25) (25) (30) (28)
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Total consumer (81) (78) (80) (76) (51)
Residential mortgage (1) (3) (3) (2) (2)
Commercial (18) (11) (10) (10) (17)
Commercial real estate (5) (3) (3) (1) (9)
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Total charge-offs (105) (95) (96) (89) (79)
Recoveries
Consumer
Credit card 5 4 9 7 2
Other consumer 10 9 9 9 9
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Total consumer 15 13 18 16 11
Residential mortgage 1 1
Commercial 4 7 18 9 7
Commercial real estate 6 2 1 3 3
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Total recoveries 25 22 37 29 22
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Net charge-offs (80) (73) (59) (60) (57)
Provision for credit losses 25 20 15 10
Acquisitions 5 3 71
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Ending balance $972 $1,027 $1,075 $1,119 $1,166
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NONPERFORMING ASSETS December 31 September 30 June 30 March 31 December 31
Period ended - in millions 1997 1997 1997 1997 1996
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Nonaccrual loans
Commercial $128 $142 $155 $135 $156
Commercial real estate
Commercial mortgage 84 94 106 113 109
Real estate project 10 28 33 24 25
Consumer 10 6 5 5 6
Residential mortgage 44 45 46 45 51
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Total nonaccrual loans 276 315 345 322 347
Restructured loans 2 1 1 2
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Total nonperforming loans 276 317 346 323 349
Foreclosed assets
Commercial real estate 27 37 55 66 71
Residential mortgage 21 23 23 24 22
Other 9 17 18 16 17
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Total foreclosed assets 57 77 96 106 110
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Total nonperforming assets $333 $394 $442 $429 $459
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