-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IFhIhh6gWHMJ1PfFE/PIyh/sIzG9GZwDf0y6lD2THLyIuynZLOobaR4z1JUE1mZm nngy0Iv2KjNKcOECFEMwQQ== 0000950128-96-000408.txt : 19960718 0000950128-96-000408.hdr.sgml : 19960718 ACCESSION NUMBER: 0000950128-96-000408 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960715 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19960717 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PNC BANK CORP CENTRAL INDEX KEY: 0000713676 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 251435979 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09718 FILM NUMBER: 96596003 BUSINESS ADDRESS: STREET 1: ONE PNC PLAZA STREET 2: FIFTH AVE & WOOD ST CITY: PITTSBURGH STATE: PA ZIP: 15265 BUSINESS PHONE: 4127622666 MAIL ADDRESS: STREET 1: ONE PNC PLAZA STREET 2: FIFTH AVENUE & WOOD STREET CITY: PITTSBURGH STATE: PA ZIP: 15265 FORMER COMPANY: FORMER CONFORMED NAME: PNC BANK CORP /PA/ DATE OF NAME CHANGE: 19930428 FORMER COMPANY: FORMER CONFORMED NAME: PNC FINANCIAL CORP DATE OF NAME CHANGE: 19920703 8-K 1 PNC BANK 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 JULY 15, 1996 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) PNC BANK CORP. (Exact name of registrant as specified in its charter) COMMISSION FILE NUMBER 1-9718 PENNSYLVANIA 25-1435979 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) ONE PNC PLAZA 249 FIFTH AVENUE PITTSBURGH, PENNSYLVANIA 15222-2707 (Address of principal executive offices) (Zip Code) (412) 762-1553 (Registrant's telephone number, including area code) (Former name or former address, if changed since last report) 2 ITEM 5. OTHER EVENTS 1996 Second Quarter Financial Results On July 15, 1996, PNC Bank Corp. ("Corporation") reported results of operations for the three months and six months ended June 30, 1996. A copy of the earnings press release issued by the Corporation is attached as Exhibit 99 and incorporated herein by reference. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits The exhibit listed on the Exhibit Index on page 3 of this Form 8-K is filed herewith. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. PNC BANK CORP. (Registrant) Date: July 17, 1996 By /s/ ROBERT L. HAUNSCHILD -------------------------- Robert L. Haunschild Senior Vice President and Chief Financial Officer 2 3 EXHIBIT INDEX 99 Earnings press release issued by the Corporation on July 15, 1996, with respect to the results of operations for the three months and six months ended June 30, 1996, is filed herewith. 3 EX-99 2 PNC BANK 1 Exhibit 99 CONTACTS: MEDIA: - ------ Jonathan Williams (412) 762-4550 INVESTORS: - ---------- William H. Callihan (412) 762-8257 PNC BANK CORP. EARNINGS INCREASE 28 PERCENT PITTSBURGH, July 15, 1996 -- PNC Bank Corp. (NYSE: PNC) today reported second quarter 1996 earnings increased 28% compared with the same period in 1995. Net income totaled $248.1 million or $0.72 per fully diluted share compared with $194.0 million or $0.56 per fully diluted share for the second quarter of 1995. Return on average assets and average common shareholders' equity improved to 1.38% and 17.33%, respectively, from 1.03% and 13.65% a year ago. "Our second quarter earnings were generated by solid performance from our major businesses including growth in fee-based revenues led by asset management, brokerage and corporate finance. This quarter's strong results also reflect the benefits of previous actions taken to reposition our balance sheet," said Thomas H. O'Brien, chairman and chief executive officer. "In addition, we continue to be enthusiastic about the progress of the Midlantic integration and the value this combination is creating for our shareholders." SECOND QUARTER HIGHLIGHTS o Net interest income increased 15.9% and net interest margin widened 66 basis points to 3.72% compared with the second quarter of 1995. o Noninterest income before securities gains increased 13.1% excluding the impact of alliances in credit card and merchant services. -more- 2 PNC Bank Corp. Earnings Increase 28 Percent Page 2 o The efficiency ratio improved to 59.0% reflecting aggressive management of operating expenses. o Asset quality remained strong. Net charge-offs were 0.29% of average loans and consumer net charge-offs declined compared with the first quarter of 1996. o The integration of Midlantic's operations is proceeding on schedule and will be substantially completed by the end of the third quarter of 1996. INCOME STATEMENT REVIEW Taxable-equivalent net interest income for the second quarter of 1996 increased $85.2 million to $619.9 million and net interest margin widened to 3.72% compared with $534.7 million and 3.06%, respectively, in the year-earlier period. The increase in net interest income was due to loan growth, the Chemical Bank, New Jersey acquisition and the balance sheet repositioning. The improvement in net interest margin is primarily due to a higher proportion of loans to earning assets and an increase in lower-cost consumer deposits relative to total sources of funds. Noninterest income increased 7.4% to $336.6 million for the second quarter of 1996 compared with the year-earlier period. Excluding the impact of alliances in credit card and merchant services, noninterest income before securities gains increased 13.1%. Asset management and trust revenue increased $15.4 million or 14.1% due to growth in mutual fund and personal trust services and an increase in the value of assets under administration. Discretionary assets totaled $104.5 billion at June 30, 1996 compared with $89.3 billion a year ago. Service fees increased 12.2% to $133.6 million. Deposit fees increased $14.1 million primarily due to growth in treasury management revenue and acquisitions. Brokerage and corporate finance fees increased 48.8% and 23.7%, respectively. Credit card and merchant services declined $11.0 million in the quarter-to-quarter comparison as a result of alliances with third parties for these businesses. Excluding this impact service fees increased 23.7%. -more- 3 PNC Bank Corp. Earnings Increase 28 Percent Page 3 Mortgage banking revenue declined in the comparison primarily due to lower servicing sales and the impact of an increasingly competitive market for mortgage originations. Mortgage originations totaled $1.6 billion in the second quarter of 1996 and, at June 30, 1996, the corporation serviced $40.6 billion of mortgages, including $28.1 billion serviced for others. Other noninterest income increased $12.6 million to $38.8 million, primarily due to higher venture capital income. Noninterest expense increased 4.0% compared with the second quarter of 1995 due to acquisitions, investments in alternative delivery capabilities and incentive compensation related to higher levels of fee-based revenue. The increases were partially offset by lower Federal deposit insurance premiums. Excluding acquisitions, noninterest expense declined slightly in the comparison. The efficiency ratio improved to 59.0% for the second quarter of 1996 compared with 64.0% a year ago. BALANCE SHEET REVIEW Average earning assets declined $3.1 billion to $66.4 billion compared to the second quarter of 1995. The decline results from the corporation's initiative to downsize the securities portfolio and reduce associated wholesale funding. Average securities declined $8.4 billion to $14.7 billion which represents 22.2% of average earning assets compared with 33.3% a year ago. Average loans increased $4.4 billion to $49.2 billion, representing 74.1% of average earning assets compared with 64.4% a year ago. Excluding acquisitions, average loans increased 5.0% in the comparison. Consumer loan growth was tempered by competitive pricing pressures and the corporation's assessment of national asset quality trends in consumer lending. Average deposits increased $1.0 billion to $45.4 billion for the second quarter of 1996. Higher levels of retail deposits from acquisitions were partially offset by lower wholesale liabilities. Excluding acquisitions and wholesale deposits, average deposits increased 1.3% in the comparison. Average deposits represented 62.6% of total sources of funds in the second quarter of 1996 compared with 58.9% a year ago. -more- 4 PNC Bank Corp. Earnings Increase 28 Percent Page 4 The corporation's asset quality remained strong during the second quarter of 1996. The allowance for credit losses was $1.2 billion at June 30, 1996, representing 312% of nonperforming loans compared with 273% at June 30, 1995. Net charge-offs were $36 million, or 0.29% of average loans in the second quarter of 1996 compared with $26 million and 0.23%, respectively, a year ago. Consumer net charge-offs were 0.79% compared with 0.90% in the first quarter of 1996 and 0.52% a year ago. Nonperforming assets declined to $509 million at June 30, 1996, compared with $673 million at the end of the second quarter 1995. The ratio of nonperforming assets to total loans and foreclosed assets was 1.03% at June 30, 1996 and 1.47% at June 30, 1995. Shareholders' equity totaled $5.8 billion or $17.07 per common share at June 30, 1996. The leverage capital ratio was 6.96%, and Tier I and total risk-based capital ratios are estimated to be 8.5% and 12.0%, respectively. During the second quarter of 1996, approximately 1.6 million common shares were repurchased as part of a systematic program for employee benefit and dividend reinvestment plans. YEAR-TO-DATE RESULTS Net income for the first six months of 1996 totaled $486.4 million or $1.41 per fully diluted share compared with $373.5 million or $1.08 per fully diluted share for the first six months of 1995. Return on average assets and average common shareholders' equity were 1.36% and 16.99%, respectively, compared with 1.00% and 13.24%, respectively, for the first six months of 1995. PNC Bank Corp., headquartered in Pittsburgh, is one of the largest financial services organizations in the United States, with banking subsidiaries in Pennsylvania, New Jersey, Delaware, Ohio, Kentucky, Indiana, Massachusetts, and Florida. Its major businesses include consumer banking, corporate banking, mortgage banking, real estate banking and asset management. [TABULAR MATERIAL FOLLOWS] -more- 5 PNC BANK CORP. AND SUBSIDIARIES Page 5 Consolidated Financial Highlights
Three months ended Six months ended June 30 June 30 -------------------------------------------------- 1996 1995 1996 1995 - ---------------------------------------------------------------------------------------------------------------------------------- FINANCIAL PERFORMANCE (Dollars in thousands, except per share data) Net interest income (taxable-equivalent basis) $619,926 $534,741 $1,236,034 $1,085,877 Net income 248,050 193,953 486,370 373,500 Fully diluted earnings per common share .72 .56 1.41 1.08 Return on average total assets 1.38% 1.03% 1.36% 1.00% Return on average common shareholders' equity 17.33 13.65 16.99 13.24 Net interest margin 3.72 3.06 3.72 3.12 After-tax profit margin 25.93 22.87 25.68 22.17 Efficiency ratio 59.00 63.99 59.65 65.06 AVERAGE BALANCES (In millions) Assets $72,440 $75,343 $72,087 $75,092 Earning assets 66,356 69,495 66,030 69,490 Loans, net of unearned income 49,191 44,765 48,908 44,240 Securities 14,740 23,137 14,779 23,558 Deposits 45,379 44,365 45,465 44,018 Shareholders' equity 5,767 5,727 5,766 5,719 - ----------------------------------------------------------------------------------------------------------------------------------
June 30 March 31 December 31 June 30 As of or for the three months ended 1996 1996 1995 1995 - ---------------------------------------------------------------------------------------------------------------------------------- PERIOD-END BALANCES (In millions) Assets $71,961 $72,668 $73,404 $76,519 Earning assets 65,234 66,041 66,772 69,623 Loans, net of unearned income 49,223 48,800 48,653 45,491 Securities 14,107 14,692 15,839 22,397 Deposits 44,852 45,621 46,899 46,177 Shareholders' equity 5,832 5,786 5,768 5,793 SELECTED RATIOS Capital ratios Leverage 6.96% 6.90% 6.37% 6.79% Common shareholders' equity to assets 8.08 7.94 7.83 7.55 Average common shareholders' equity to average assets 7.94 8.01 7.76 7.51 Asset quality ratios Net charge-offs to average loans .29 .28 .45 .23 Nonperforming loans to loans .77 .76 .74 1.05 Nonperforming assets to loans and foreclosed assets 1.03 1.10 1.10 1.47 Nonperforming assets to total assets .71 .74 .73 .88 Allowance for credit losses to loans 2.42 2.51 2.59 2.86 Allowance for credit losses to nonperforming loans 312.19 328.88 351.68 272.54 Book value per common share As reported $17.07 $16.88 $16.87 $17.24 Excluding net unrealized securities gains/losses 17.49 17.16 16.79 17.35 - ----------------------------------------------------------------------------------------------------------------------------------
-more- 6 PNC BANK CORP. AND SUBSIDIARIES Page 6 Consolidated Statement of Income
Three months ended Six months ended June 30 June 30 ---------------------------------------------------- In thousands, except per share data 1996 1995 1996 1995 - ---------------------------------------------------------------------------------------------------------------------------------- INTEREST INCOME Loans and fees on loans $971,829 $927,370 $1,952,665 $1,814,791 Securities 232,251 337,595 469,693 682,999 Other 39,062 29,678 76,122 58,130 ---------------------------------------------------- Total interest income 1,243,142 1,294,643 2,498,480 2,555,920 INTEREST EXPENSE Deposits 351,891 390,754 722,874 748,475 Borrowed funds 107,702 226,279 220,159 437,246 Notes and debentures 172,769 154,788 337,810 308,097 ---------------------------------------------------- Total interest expense 632,362 771,821 1,280,843 1,493,818 ---------------------------------------------------- Net interest income 610,780 522,822 1,217,637 1,062,102 Provision for credit losses 1,500 3,000 ---------------------------------------------------- Net interest income less provision for credit losses 610,780 521,322 1,217,637 1,059,102 NONINTEREST INCOME Asset management and trust 124,515 109,151 245,392 199,519 Service fees 133,598 119,091 263,867 240,563 Mortgage banking 35,758 50,858 71,740 95,581 Net securities gains 3,904 7,966 6,847 9,220 Other 38,810 26,184 70,301 53,924 ---------------------------------------------------- Total noninterest income 336,585 313,250 658,147 598,807 NONINTEREST EXPENSE Staff expense 284,281 265,415 562,938 528,816 Net occupancy and equipment 92,182 84,537 185,465 171,271 Intangible asset and MSR amortization 28,062 23,855 51,726 47,190 Federal deposit insurance 3,435 24,217 6,625 48,537 Other 156,362 144,639 323,214 300,200 ---------------------------------------------------- Total noninterest expense 564,322 542,663 1,129,968 1,096,014 ---------------------------------------------------- Income before income taxes 383,043 291,909 745,816 561,895 Applicable income taxes 134,993 97,956 259,446 188,395 ---------------------------------------------------- Net income $248,050 $193,953 $486,370 $373,500 ---------------------------------------------------- EARNINGS PER COMMON SHARE Primary $.72 $.57 $1.42 $1.09 Fully diluted .72 .56 1.41 1.08 CASH DIVIDENDS DECLARED PER COMMON SHARE .35 .35 .70 .70 AVERAGE COMMON SHARES OUTSTANDING Primary 343,022 337,458 342,949 339,608 Fully diluted 347,343 342,479 347,306 345,057 - ----------------------------------------------------------------------------------------------------------------------------------
-more- 7 PNC BANK CORP. AND SUBSIDIARIES Page 7 Details of Net Interest Income
Three months ended Six months ended Taxable-equivalent basis June 30 June 30 --------------------------------------------------- In thousands 1996 1995 1996 1995 - ----------------------------------------------------------------------------------------------------------------------------------- Interest income/expense before hedging activities Interest income $1,224,852 $1,314,090 $2,461,129 $2,592,922 Loan fees 20,828 21,354 45,285 40,943 Taxable-equivalent adjustment 9,146 11,919 18,397 23,775 -------------------------------------------------- Total interest income 1,254,826 1,347,363 2,524,811 2,657,640 Interest expense 632,229 762,064 1,279,426 1,479,475 -------------------------------------------------- Net interest income before hedging activities 622,597 585,299 1,245,385 1,178,165 Effect of hedging activities on Interest income (2,538) (40,801) (7,934) (77,945) Interest expense 133 9,757 1,417 14,343 -------------------------------------------------- Total effect of hedging activities (2,671) (50,558) (9,351) (92,288) -------------------------------------------------- Net interest income $619,926 $534,741 $1,236,034 $1,085,877 - -----------------------------------------------------------------------------------------------------------------------------------
Three months ended Taxable-equivalent basis June 30 March 31 December 31 September 30 June 30 In thousands 1996 1996 1995 1995 1995 - ------------------------------------------------------------------------------------------------------------------------------------ Interest income/expense before hedging activities Interest income $1,224,852 $1,236,277 $1,318,461 $1,312,720 $1,314,090 Loan fees 20,828 24,457 17,965 23,115 21,354 Taxable-equivalent adjustment 9,146 9,251 11,077 11,790 11,919 ----------------------------------------------------------------- Total interest income 1,254,826 1,269,985 1,347,503 1,347,625 1,347,363 Interest expense 632,229 647,197 739,819 760,001 762,064 ----------------------------------------------------------------- Net interest income before hedging activities 622,597 622,788 607,684 587,624 585,299 Effect of hedging activities on Interest income (2,538) (5,396) (36,424) (42,326) (40,801) Interest expense 133 1,284 7,435 6,489 9,757 ----------------------------------------------------------------- Total effect of hedging activities (2,671) (6,680) (43,859) (48,815) (50,558) ----------------------------------------------------------------- Net interest income $619,926 $616,108 $563,825 $538,809 $534,741 - ------------------------------------------------------------------------------------------------------------------------------------
-more- 8 PNC BANK CORP. AND SUBSIDIARIES Page 8 Details of Net Interest Margin
Three months ended Six months ended June 30 June 30 ---------------------------------------------- Taxable-equivalent basis 1996 1995 1996 1995 - ----------------------------------------------------------------------------------------------------------------------------------- Rates earned/paid before hedging activities Book-basis yield on earning assets 7.37% 7.49% 7.44% 7.46% Effect of loan fees .12 .12 .14 .12 Taxable-equivalent adjustment .06 .07 .06 .07 ---------------------------------------------- Taxable-equivalent yield on earning assets 7.55 7.68 7.64 7.65 Rate on interest-bearing liabilities 4.59 5.09 4.67 5.03 ---------------------------------------------- Interest rate spread 2.96 2.59 2.97 2.62 Noninterest-bearing sources .78 .77 .78 .76 ---------------------------------------------- Net interest margin before hedging activities 3.74 3.36 3.75 3.38 Effect of hedging activities on Interest income (.02) (.23) (.03) (.22) Interest expense .07 .04 ---------------------------------------------- Total effect of hedging activities (.02) (.30) (.03) (.26) ---------------------------------------------- Net interest margin 3.72% 3.06% 3.72% 3.12% - -----------------------------------------------------------------------------------------------------------------------------------
Three months ended June 30 March 31 December 31 September 30 June 30 Taxable-equivalent basis 1996 1996 1995 1995 1995 - ----------------------------------------------------------------------------------------------------------------------------------- Rates earned/paid before hedging activities Book-basis yield on earning assets 7.37% 7.51% 7.50% 7.49% 7.49% Effect of loan fees .12 .15 .10 .13 .12 Taxable-equivalent adjustment .06 .06 .06 .07 .07 ---------------------------------------------------------- Taxable-equivalent yield on earning assets 7.55 7.72 7.66 7.69 7.68 Rate on interest-bearing liabilities 4.59 4.74 4.98 5.11 5.09 ---------------------------------------------------------- Interest rate spread 2.96 2.98 2.68 2.58 2.59 Noninterest-bearing sources .78 .79 .79 .79 .77 ---------------------------------------------------------- Net interest margin before hedging activities 3.74 3.77 3.47 3.37 3.36 Effect of hedging activities on Interest income (.02) (.03) (.20) (.24) (.23) Interest expense .01 .05 .04 .07 ---------------------------------------------------------- Total effect of hedging activities (.02) (.04) (.25) (.28) (.30) ---------------------------------------------------------- Net interest margin 3.72% 3.73% 3.22% 3.09% 3.06% - -----------------------------------------------------------------------------------------------------------------------------------
-more- 9 PNC BANK CORP. AND SUBSIDIARIES Page 9 Details of Noninterest Income
Three months ended Six months ended June 30 June 30 ---------------------------------------------- In thousands 1996 1995 1996 1995 - -------------------------------------------------------------------------------------------------------------------------------- Asset management and trust Asset management services $24,284 $20,811 $49,933 $33,324 Mutual fund services 45,671 39,325 89,657 71,174 Trust 54,560 49,015 105,802 95,021 ---------------------------------------------- Total asset management and trust 124,515 109,151 245,392 199,519 Service fees Deposit 72,403 58,326 137,921 116,713 Brokerage 15,344 10,311 28,986 19,653 Consumer 14,370 11,839 27,828 24,165 Corporate finance 16,106 13,021 29,521 25,405 Credit card and merchant services 282 11,321 9,200 26,652 Insurance 6,872 6,062 13,644 11,468 Other 8,221 8,211 16,767 16,507 ---------------------------------------------- Total service fees 133,598 119,091 263,867 240,563 Mortgage banking Servicing 30,443 29,772 59,481 60,898 Marketing 4,683 11,414 11,277 12,753 Sale of servicing 632 9,672 982 21,930 ---------------------------------------------- Total mortgage banking 35,758 50,858 71,740 95,581 Net securities gains 3,904 7,966 6,847 9,220 Other 38,810 26,184 70,301 53,924 ---------------------------------------------- Total $336,585 $313,250 $658,147 $598,807 - --------------------------------------------------------------------------------------------------------------------------------
Three months ended June 30 March 31 December 31 September 30 June 30 In thousands 1996 1996 1995 1995 1995 - -------------------------------------------------------------------------------------------------------------------------------- Asset management and trust Asset management services $24,284 $25,649 $18,890 $20,814 $20,811 Mutual fund services 45,671 43,986 42,349 40,829 39,325 Trust 54,560 51,242 50,285 47,474 49,015 ----------------------------------------------------------- Total asset management and trust 124,515 120,877 111,524 109,117 109,151 Service fees Deposit 72,403 65,518 62,843 60,722 58,326 Brokerage 15,344 13,642 11,587 10,113 10,311 Consumer 14,370 13,458 14,821 14,437 11,839 Corporate finance 16,106 13,415 14,592 13,133 13,021 Credit card and merchant services 282 8,918 10,888 9,649 11,321 Insurance 6,872 6,772 6,599 6,764 6,062 Other 8,221 8,546 9,473 8,465 8,211 ----------------------------------------------------------- Total service fees 133,598 130,269 130,803 123,283 119,091 Mortgage banking Servicing 30,443 29,038 28,488 30,215 29,772 Marketing 4,683 6,594 9,893 10,649 11,414 Sale of servicing 632 350 1,046 10,745 9,672 ----------------------------------------------------------- Total mortgage banking 35,758 35,982 39,427 51,609 50,858 Net securities gains (losses) 3,904 2,943 (288,958) 44 7,966 Other 38,810 31,491 30,490 54,273 26,184 ----------------------------------------------------------- Total $336,585 $321,562 $23,286 $338,326 $313,250 - --------------------------------------------------------------------------------------------------------------------------------
-more- 10 PNC BANK CORP. AND SUBSIDIARIES Page 10 Details of Noninterest Expense
Three months ended Six months ended June 30 June 30 --------------------------------------------------- In thousands 1996 1995 1996 1995 - -------------------------------------------------------------------------------------------------------------------------------- Compensation $234,542 $213,879 $462,775 $422,572 Employee benefits 49,739 51,536 100,163 106,244 --------------------------------------------------- Total staff expense 284,281 265,415 562,938 528,816 Net occupancy 49,192 45,771 99,764 91,432 Equipment 42,990 38,766 85,701 79,839 Intangible asset and MSR amortization 28,062 23,855 51,726 47,190 Taxes other than income 13,391 13,107 28,021 26,205 Federal deposit insurance 3,435 24,217 6,625 48,537 Other 142,971 131,532 295,193 273,995 --------------------------------------------------- Total $564,322 $542,663 $1,129,968 $1,096,014 - --------------------------------------------------------------------------------------------------------------------------------
Three months ended June 30 March 31 December 31 September 30 June 30 In thousands 1996 1996 1995 1995 1995 - -------------------------------------------------------------------------------------------------------------------------------- Compensation $234,542 $228,233 $221,645 $218,934 $213,879 Employee benefits 49,739 50,424 45,317 50,345 51,536 --------------------------------------------------------------- Total staff expense 284,281 278,657 266,962 269,279 265,415 Net occupancy 49,192 50,572 42,424 46,542 45,771 Equipment 42,990 42,711 45,639 40,188 38,766 Intangible asset and MSR amortization 28,062 23,664 41,387 26,094 23,855 Taxes other than income 13,391 14,630 13,796 12,856 13,107 Federal deposit insurance 3,435 3,190 7,662 1,470 24,217 Other 142,971 152,222 148,031 151,006 131,532 --------------------------------------------------------------- Total noninterest expense before special charges 564,322 565,646 565,901 547,435 542,663 Special charges 259,926 --------------------------------------------------------------- Total $564,322 $565,646 $825,827 $547,435 $542,663 - --------------------------------------------------------------------------------------------------------------------------------
-more- 11 PNC BANK CORP. AND SUBSIDIARIES Page 11 Consolidated Balance Sheet
June 30 December 31 June 30 Dollars in millions, except par values 1996 1995 1995 - ----------------------------------------------------------------------------------------------------------------------------------- ASSETS Cash and due from banks $3,232 $3,679 $3,446 Short-term investments 841 1,611 950 Loans held for sale 1,053 659 773 Securities available for sale 14,107 15,839 3,261 Investment securities, fair value of $18,935 19,136 Loans, net of unearned income of $358, $403 and $393 49,223 48,653 45,491 Allowance for credit losses (1,189) (1,259) (1,300) --------------------------------------- Net loans 48,034 47,394 44,191 Goodwill and other intangibles 1,004 997 756 Mortgage servicing rights 323 268 280 Other 3,367 2,957 3,726 --------------------------------------- Total assets $71,961 $73,404 $76,519 --------------------------------------- LIABILITIES Deposits Noninterest-bearing $10,245 $10,707 $9,458 Interest-bearing 34,607 36,192 36,719 --------------------------------------- Total deposits 44,852 46,899 46,177 Borrowed funds Federal funds purchased 1,362 3,817 2,222 Repurchase agreements 2,188 2,851 6,578 Commercial paper 462 753 576 Other 3,070 1,244 3,893 --------------------------------------- Total borrowed funds 7,082 8,665 13,269 Notes and debentures 12,243 10,398 9,368 Other 1,952 1,674 1,912 --------------------------------------- Total liabilities 66,129 67,636 70,726 SHAREHOLDERS' EQUITY Preferred stock - $1 par value Authorized: 17,492,925, 17,529,342 and 17,562,360 shares Issued and outstanding: 812,367, 848,784 and 881,802 shares 1 1 1 Common stock - $5 par value Authorized: 450,000,000 shares Issued: 340,634,415, 340,863,348 and 344,648,895 shares 1,711 1,704 1,723 Capital surplus 571 545 698 Retained earnings 3,817 3,571 3,717 Deferred benefit expense (77) (79) (83) Net unrealized securities gains (losses) (141) 26 (37) Common stock held in treasury at cost: 1,630,612 and 9,724,594 shares (50) (226) --------------------------------------- Total shareholders' equity 5,832 5,768 5,793 --------------------------------------- Total liabilities and shareholders' equity $71,961 $73,404 $76,519 - ----------------------------------------------------------------------------------------------------------------------------------
-more- 12 PNC BANK CORP. AND SUBSIDIARIES Page 12 Condensed Consolidated Average Balance Sheet
Three months ended Six months ended June 30 June 30 -------------------------------------------------- In millions 1996 1995 1996 1995 - ---------------------------------------------------------------------------------------------------------------------------------- ASSETS Interest-earning assets Short-term investments $1,155 $1,042 $1,128 $1,187 Securities available for sale 14,740 3,754 14,779 3,978 Investment securities 19,383 19,580 Loans, net of unearned income 49,191 44,765 48,908 44,240 Other interest-earning assets 1,270 551 1,215 505 -------------------------------------------------- Total interest-earning assets 66,356 69,495 66,030 69,490 Other 6,084 5,848 6,057 5,602 -------------------------------------------------- Total assets $72,440 $75,343 $72,087 $75,092 -------------------------------------------------- LIABILITIES Interest-bearing liabilities Deposits $35,383 $35,407 $35,627 $35,182 Borrowed funds 7,816 14,140 7,819 14,018 Notes and debentures 11,904 9,586 11,487 9,848 -------------------------------------------------- Total interest-bearing liabilities 55,103 59,133 54,933 59,048 Noninterest-bearing deposits 9,996 8,958 9,838 8,836 Other 1,574 1,525 1,550 1,489 -------------------------------------------------- Total liabilities 66,673 69,616 66,321 69,373 SHAREHOLDERS' EQUITY 5,767 5,727 5,766 5,719 -------------------------------------------------- Total liabilities and shareholders' equity $72,440 $75,343 $72,087 $75,092 -------------------------------------------------- COMMON SHAREHOLDERS' EQUITY $5,750 $5,660 $5,749 $5,651 - ----------------------------------------------------------------------------------------------------------------------------------
Three months ended June 30 March 31 December 31 September 30 June 30 In millions 1996 1996 1995 1995 1995 - ---------------------------------------------------------------------------------------------------------------------------------- ASSETS Interest-earning assets Short-term investments $1,155 $1,102 $950 $815 $1,042 Securities available for sale 14,740 14,818 9,349 3,222 3,754 Investment securities 10,101 18,823 19,383 Loans, net of unearned income Consumer 13,243 13,370 13,188 11,822 11,603 Residential mortgage 11,883 11,619 11,462 11,066 10,629 Commercial 17,190 16,806 16,590 15,914 15,620 Commercial real estate 4,831 4,885 5,029 5,096 5,016 Other 2,044 1,945 2,035 1,748 1,897 -------------------------------------------------------------- Total loans, net of unearned income 49,191 48,625 48,304 45,646 44,765 Other interest-earning assets 1,270 1,160 977 952 551 -------------------------------------------------------------- Total interest-earning assets 66,356 65,705 69,681 69,458 69,495 Other 6,084 6,028 6,026 5,808 5,848 -------------------------------------------------------------- Total assets $72,440 $71,733 $75,707 $75,266 $75,343 -------------------------------------------------------------- LIABILITIES Interest-bearing liabilities Deposits $35,383 $35,872 $36,577 $35,945 $35,407 Borrowed funds 7,816 7,823 11,511 14,016 14,140 Notes and debentures 11,904 11,068 10,637 8,829 9,586 -------------------------------------------------------------- Total interest-bearing liabilities 55,103 54,763 58,725 58,790 59,133 Noninterest-bearing deposits 9,996 9,681 9,639 9,132 8,958 Other 1,574 1,525 1,450 1,542 1,525 -------------------------------------------------------------- Total liabilities 66,673 65,969 69,814 69,464 69,616 SHAREHOLDERS' EQUITY 5,767 5,764 5,893 5,802 5,727 -------------------------------------------------------------- Total liabilities and shareholders' equity $72,440 $71,733 $75,707 $75,266 $75,343 -------------------------------------------------------------- COMMON SHAREHOLDERS' EQUITY $5,750 $5,747 $5,875 $5,784 $5,660 - ----------------------------------------------------------------------------------------------------------------------------------
-more- 13 PNC BANK CORP. AND SUBSIDIARIES Page 13 Asset Quality Data
ALLOWANCE FOR CREDIT LOSSES Three months ended June 30 March 31 December 31 September 30 June 30 March 31 In millions 1996 1996 1995 1995 1995 1995 - ---------------------------------------------------------------------------------------------------------------------------------- Beginning balance $1,225 $1,259 $1,285 $1,300 $1,318 $1,352 Charge-offs Consumer (38) (39) (36) (23) (27) (23) Commercial (17) (10) (29) (11) (14) (30) Other (3) (6) (12) (14) (12) (9) ----------------------------------------------------------------------------- Total loans charged off (58) (55) (77) (48) (53) (62) Recoveries Consumer 12 9 9 10 12 10 Commercial 6 9 8 14 14 13 Other 4 3 5 7 1 3 ----------------------------------------------------------------------------- Total recoveries 22 21 22 31 27 26 ----------------------------------------------------------------------------- Net charge-offs (36) (34) (55) (17) (26) (36) Provision for credit losses 1 2 2 1 Acquisitions 28 6 1 ----------------------------------------------------------------------------- Ending balance $1,189 $1,225 $1,259 $1,285 $1,300 $1,318 - ----------------------------------------------------------------------------------------------------------------------------------
NONPERFORMING ASSETS June 30 March 31 December 31 September 30 June 30 In millions 1996 1996 1995 1995 1995 - ---------------------------------------------------------------------------------------------------------------------------------- Nonaccrual loans Commercial $169 $141 $118 $126 $148 Commercial real estate Commercial mortgage 127 116 108 109 113 Real estate project 30 40 45 89 103 Consumer 6 7 10 17 14 Residential mortgage 46 51 54 55 54 ------------------------------------------------------------------ Total nonaccrual loans 378 355 335 396 432 Restructured loans 3 17 23 45 45 ------------------------------------------------------------------ Total nonperforming loans 381 372 358 441 477 Foreclosed assets Commercial real estate 85 98 105 115 119 Residential 21 26 24 25 26 Other 22 44 49 50 51 ------------------------------------------------------------------ Total foreclosed assets 128 168 178 190 196 ------------------------------------------------------------------ Total nonperforming assets $509 $540 $536 $631 $673 - ----------------------------------------------------------------------------------------------------------------------------------
LOAN PORTFOLIO Period ended June 30 March 31 December 31 September 30 June 30 In millions 1996 1996 1995 1995 1995 - ---------------------------------------------------------------------------------------------------------------------------------- Consumer $13,178 $13,566 $13,539 $11,954 $11,930 Residential mortgage 12,139 11,620 11,689 11,444 10,999 Commercial 17,296 16,950 16,812 15,789 16,010 Commercial real estate Commercial mortgage 2,644 2,737 2,775 2,799 2,838 Real estate project 2,193 2,137 2,139 2,261 2,233 Other 2,131 2,170 2,102 2,044 1,874 ------------------------------------------------------------------ Total loans 49,581 49,180 49,056 46,291 45,884 Unearned income (358) (380) (403) (390) (393) ------------------------------------------------------------------ Loans, net of unearned income $49,223 $48,800 $48,653 $45,901 $45,491 - ----------------------------------------------------------------------------------------------------------------------------------
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