XML 64 R41.htm IDEA: XBRL DOCUMENT v3.8.0.1
Employee Benefit Plans (Tables)
 12 Months Ended
Dec. 31, 2017
Employee Benefit Plans [Abstract]  
Reconciliation of Changes in Projected Benefit Obligation and Change in Plan Assets
Table 72: Reconciliation of Changes in Projected Benefit Obligation and Change in Plan Assets
 
Qualified
Pension
 
Nonqualified
Pension
 
Postretirement
Benefits
December 31 (Measurement Date) – in millions
2017

 
2016

 
2017

 
2016

 
2017

 
2016

Accumulated benefit obligation at end of year
$
4,726

 
$
4,495

 
$
280

 
$
282

 
 
 
 
Projected benefit obligation at beginning of year
$
4,547

 
$
4,397

 
$
289

 
$
298

 
$
373

 
$
368

Service cost
160

 
102

 
3

 
3

 
5

 
6

Interest cost
179

 
186

 
10

 
12

 
14

 
15

Amendments
17

 


 
 
 


 
2

 


Actuarial (gains)/losses and changes in assumptions
172

 
131

 
8

 
7

 
(18
)
 
6

Participant contributions
 
 

 
 
 

 
3

 
4

Federal Medicare subsidy on benefits paid
 
 

 
 
 

 
1

 
1

Benefits paid
(286
)
 
(269
)
 
(24
)
 
(31
)
 
(25
)
 
(27
)
Projected benefit obligation at end of year
$
4,789

 
$
4,547

 
$
286

 
$
289

 
$
355

 
$
373

Fair value of plan assets at beginning of year
$
4,617

 
$
4,316

 

 
 
 
$
208

 
$
200

Actual return on plan assets
722

 
320

 
 
 

 
9

 
(7
)
Employer contribution
200

 
250

 
$
24

 
$
31

 
34

 
$
37

Participant contributions
 
 

 
 
 

 
3

 
4

Federal Medicare subsidy on benefits paid
 
 

 
 
 

 
1

 
1

Benefits paid
(286
)
 
(269
)
 
(24
)
 
(31
)
 
(25
)
 
(27
)
Fair value of plan assets at end of year
$
5,253

 
$
4,617

 


 


 
$
230

 
$
208

Funded status
$
464

 
$
70

 
$
(286
)
 
$
(289
)
 
$
(125
)
 
$
(165
)
Amounts recognized on the consolidated balance sheet
 
 
 
 
 
 
 
 
 
 
 
Noncurrent asset
$
464

 
$
70

 
 
 

 
 
 

Current liability
 
 

 
$
(28
)
 
$
(27
)
 
$
(2
)
 
$
(2
)
Noncurrent liability
 
 


 
(258
)
 
(262
)
 
(123
)
 
(163
)
Net amount recognized on the consolidated balance sheet
$
464

 
$
70

 
$
(286
)
 
$
(289
)
 
$
(125
)
 
$
(165
)
Amounts recognized in Accumulated other comprehensive income (AOCI)
consist of:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost (credit)
$
13

 
$
(7
)
 
 
 


 
$
1

 
$
(3
)
Net actuarial loss
534

 
841

 
$
77

 
$
74

 
18

 
40

Amount recognized in AOCI
$
547

 
$
834

 
$
77

 
$
74

 
$
19

 
$
37
Asset Strategy Allocations
Table 73: Asset Strategy Allocations
 
Target
Allocation
Range

Percentage of
Plan Assets by
Strategy at
December 31
 
PNC Pension Plan
  
2017

2016

Asset Category
 
 
 
Domestic Equity
20 – 40%

30
%
28
%
International Equity
10 – 25%

24
%
21
%
Private Equity
0 – 15%

9
%
8
%
Total Equity
40 – 70%

63
%
57
%
Domestic Fixed Income
10 – 40%

16
%
16
%
High Yield Fixed Income
0 – 25%

10
%
12
%
Total Fixed Income
10 – 65%

26
%
28
%
Real estate
0 – 15%

5
%
5
%
Other
0 – 10%

6
%
10
%
Total
100
%
100
%
100
%
Pension Plan Assets - Fair Value Hierarchy
The following table sets forth by level, within the fair value hierarchy, the Plan’s assets at fair value as of December 31, 2017 and 2016.
Table 74: Pension Plan Assets - Fair Value Hierarchy
 
Fair Value Measurements Using:
 
December 31, 2017 - in millions
Fair Value

 
Quoted Prices in
Active Markets
For Identical Assets
(Level 1)

 
Significant Other
Observable Inputs
(Level 2)

 
Significant
Unobservable Inputs
(Level 3)

 
Interest bearing cash
$
11

 
$
10

 
$
1

 
 
 
Money market funds
339

 
339

 
 
 
 
 
U.S. government and agency securities
338

 
233

 
105

 
 
 
Corporate debt
583

 
 
 
578

 
$
5

 
Common stock
804

 
791

 
13

 
 
 
Mutual Funds
271

 
 
 
271

 
 
 
Other
77

 
1

 
69

 
7

 
Investments measured at net asset value (a)
2,830

 

 

 

 
Total
$
5,253

 
$
1,374

 
$
1,037

 
$
12

 
December 31, 2016 - in millions
 
 
 
 
 
 
 
 
Interest bearing cash
$
45

 
$
35

 
$
10

 

 
Money market funds
404

 
404

 

 

 
U.S. government and agency securities
285

 
158

 
127

 

 
Corporate debt
580

 

 
572

 
$
8

 
Common stock
652

 
645

 
7

 

 
Other
60

 

 
60

 

 
Investments measured at net asset value (a)
2,591

 
 
 
 
 
 
 
Total
$
4,617

 
$
1,242

 
$
776

 
$
8

 
(a)
In accordance with ASC 820-10, collective trust fund investments and limited partnerships are measured at fair value using the NAV per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented on the Consolidated Balance Sheet.
Estimated Cash Flows
The following table provides information regarding our estimated future cash flows related to our various plans.
Table 75: Estimated Cash Flows
 
Pension Plans
 
Postretirement Benefits
 
In millions
Qualified Pension

 
Nonqualified Pension

 
Gross PNC Benefit Payments

 
Reduction in PNC Benefit Payments Due to Medicare Part D Subsidy

 
Estimated 2018 employer contributions
 
 
$
28

 
$
26

 
 
 
Estimated future benefit payments
 
 
 
 
 
 
 
 
2018
$
295

 
$
28

 
$
26

 
 
 
2019
$
303

 
$
25

 
$
27

 
 
 
2020
$
315

 
$
24

 
$
27

 
 
 
2021
$
318

 
$
23

 
$
26

 
 
 
2022
$
318

 
$
22

 
$
26

 
 
 
2023-2027
$
1,573

 
$
100

 
$
123

 
$
2

 
Components of Net Periodic Benefit Cost
The components of net periodic benefit cost/(income) and other amounts recognized in Other comprehensive income (OCI) were as follows.

Table 76: Components of Net Periodic Benefit Cost
 
Qualified Pension Plan
Nonqualified Pension Plan
Postretirement Benefits
Year ended December 31 – in millions
2017

2016

2015

2017

2016

2015

2017

2016

2015

Net periodic cost consists of:
 
 
 
 
 
 
 
 
 
Service cost (a)
$
160

$
102

$
107

$
3

$
3

$
3

$
5

6

$
5

Interest cost
179

186

177

10

12

11

14

15

15

Expected return on plan assets
(285
)
(281
)
(297
)
 


(5
)
(6
)

Amortization of prior service cost/(credit)
(3
)
(7
)
(9
)
 


(1
)
(1
)
(1
)
Amortization of actuarial (gain)/loss
43

45

31

4

5

7

 
 
 
Net periodic cost (benefit)
94

45

9

17

20

21

13

14

19

Other changes in plan assets and benefit obligations recognized in
Other comprehensive income:
 
 
 
 
 
 
 
 
 
Current year prior service cost/(credit)
17




 


2



Amortization of prior service (cost)/credit
3

7

9

 


1

1

1

Current year actuarial loss/(gain)
(264
)
91

152

7

7

(10
)
(22
)
17

(9
)
Amortization of actuarial gain/(loss)
(43
)
(45
)
(31
)
(4
)
(5
)
(7
)
 
 
 
Total recognized in OCI
(287
)
53

130

3

2

(17
)
(19
)
18

(8
)
Total amounts recognized in net periodic cost and OCI
$
(193
)
$
98

$
139

$
20

$
22

$
4

$
(6
)
$
32

$
11


(a) 2017 Qualified Pension service cost includes $57 million of additional service cost due to the special, one-time cash balance credit announced at the end of 2017.
Net Periodic Costs - Assumptions
The weighted-average assumptions used (as of the beginning of each year) to determine the net periodic costs shown in Table 76 were as follows.
Table 77: Net Period Costs - Assumptions
 
Net Periodic Cost Determination
Year ended December 31
2017

2016

2015

Discount rate
 
 
 
Qualified pension
4.00
%
4.25
%
3.95
%
Nonqualified pension
3.80
%
3.95
%
3.65
%
Postretirement benefits
3.90
%
4.15
%
3.80
%
Rate of compensation increase
(average)
3.50
%
3.50
%
4.00
%
Assumed health care cost trend rate
 
 
 
Initial trend
7.00
%
7.25
%
7.50
%
Ultimate trend
5.00
%
5.00
%
5.00
%
Year ultimate trend reached
2025

2025

2025

Expected long-term return on plan
assets
6.38
%
6.75
%
6.75
%
Other Pension Assumptions
The weighted-average assumptions used (as of the end of each year) to determine year end obligations for pension and postretirement benefits were as follows.
Table 78: Other Pension Assumptions
Year ended December 31
2017

 
2016

 
Discount rate
 
 
 
 
Qualified pension
3.60
%
 
4.00
%
 
Nonqualified pension
3.45
%
 
3.80
%
 
Postretirement benefits
3.55
%
 
3.90
%
 
Rate of compensation increase (average)
3.50
%
 
3.50
%
 
Assumed health care cost trend rate
 
 
 
 
Initial trend
6.75
%
 
7.00
%
 
Ultimate trend
5.00
%
 
5.00
%
 
Year ultimate trend reached
2025

 
2025