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Sep 30, 2024
PNC Q3 2024 Earnings Report
Reported net income of $1.5 billion and diluted EPS of $3.49, driven by positive operating leverage, growth in NII, and a substantial increase in fee income and TBV.
Key Takeaways
PNC Financial Services Group reported a strong third quarter in 2024, with positive operating leverage, increased net interest income (NII), substantially increased fee income, and tangible book value (TBV). The company's diluted earnings per share (EPS) was $3.49, and net income reached $1.5 billion.
Generated 1% positive operating leverage.
Net Interest Income (NII) grew by 3% and Net Interest Margin (NIM) increased by 4 bps.
Fee income increased by 10%, with strong capital markets and advisory revenue.
Tangible Book Value (TBV) per share increased by 9%.
PNC
PNC
PNC Revenue by Segment
Forward Guidance
PNC expects record NII in 2025.
Positive Outlook
- Job and income gains will continue to support consumer spending growth in the near term.
- Real GDP growth this year and next will be close to trend at around 2%.
- The unemployment rate will remain somewhat above 4% through the rest of 2024 and in 2025.
- Inflation will continue to slow as wage pressures abate, gradually moving back to the Federal Reserve’s 2% long-term objective.
- With slowing inflation PNC expects two additional federal funds rate cuts of 25 basis points each at the Federal Open Market Committee’s remaining meetings in 2024, with the rate ending this year in a range between 4.25% and 4.50%.
Challenges Ahead
- Economic and financial market conditions will be substantially different than those we are currently expecting and do not take into account potential legal and regulatory contingencies.
- PNC’s ability to take certain capital actions, including returning capital to shareholders, is subject to PNC meeting or exceeding minimum capital levels, including a stress capital buffer established by the Federal Reserve Board in connection with the Federal Reserve Board’s Comprehensive Capital Analysis and Review (CCAR) process.
- PNC's regulatory capital ratios in the future will depend on, among other things, PNC’s financial performance, the scope and terms of final capital regulations then in effect and management actions affecting the composition of PNC’s balance sheet.
- PNC’s ability to determine, evaluate and forecast regulatory capital ratios, and to take actions (such as capital distributions) based on actual or forecasted capital ratios, will be dependent at least in part on the development, validation and regulatory review of related models and the reliability of and risks resulting from extensive use of such models.
- Legal and regulatory developments could have an impact on our ability to operate our businesses, financial condition, results of operations, competitive position, reputation, or pursuit of attractive acquisition opportunities.
Revenue & Expenses
Visualization of income flow from segment revenue to net income