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Subsequent Events
9 Months Ended
Sep. 30, 2012
Subsequent Events [Abstract]  
Subsequent Events [Text Block]

Note 20 Subsequent Events

 

On October 22, 2012, PNC Bank, N.A. issued $1.0 billion of subordinated notes with a maturity date of November 1, 2022. Interest is payable semiannually, at a fixed rate of 2.70%, on May 1 and November 1 of each year, beginning on May 1, 2013.

 

Effective October 26, 2012, PNC divested certain deposits and assets of the Smartstreet business unit, which was acquired by PNC as part of the RBC Bank (USA) acquisition, to Union Bank, N.A. Smartstreet is a nationwide business focused on homeowner or community association managers and had approximately $1 billion of assets and deposits as of September 30, 2012. Upon recording of the sale transaction in the fourth quarter of 2012, the gain on sale will be immaterial and we will reduce goodwill and core deposit intangibles by approximately $46 million and $13 million, respectively, and record accrued taxes payable of approximately $32 million.

Our outstanding trust preferred securities at September 30, 2012 included $500.0 million of 12% Fixed-to-Floating Rate Normal APEX (the “Normal APEX”) issued by the National City Preferred Capital Trust I (the “Trust”). As contractually obligated under the terms of the Normal APEX, on November 1, 2012, PNC remarketed $500.1 million of its Remarketable 8.729% Junior Subordinated Notes due 2043 (the "Subordinated Notes) owned by the Trust, with the Trust selling the Subordinated Notes and PNC exchanging, with the purchasers of the Subordinated Notes, $500.1 million of its parent company Senior Notes due November 9, 2022 ( the “Senior Notes”) for the Subordinated Notes. The Senior Notes bear interest at 8.729% from and including June 10, 2012, to but excluding November 9, 2012 and thereafter at 2.854% per annum. The purchasers have commenced a secondary public offering of the Senior Notes. The remarketing, secondary offering and related transactions are expected to close on November 9, 2012, subject to customary closing conditions.

 

Contingent upon this closing, the proceeds of the remarketing will be used by the Trust to purchase $500.1 million of PNC's Non-Cumulative Perpetual Preferred Stock, Series M (the “Preferred Stock”) on December 10, 2012 as required under a stock purchase agreement between PNC and the Trust. PNC intends to redeem all $500.1 million of the Preferred Stock from the Trust immediately upon its issuance, and the Trust will in turn redeem all $500.0 million outstanding Normal APEX and $0.1 million Common Securities of the Trust. PNC has submitted redemption notices to the Property Trustee and has instructed the Property Trustee to issue the redemption notices to the holders of the Preferred Stock, Normal APEX and Common Securities on November 9, 2012, contingent upon the settlement of the secondary offering and related transactions described above on that day. After the closing of these transactions, including the redemption of the Normal APEX, only the Senior Notes due November 9, 2022 will remain outstanding.