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Pennsylvania
|
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25-1435979
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(State or other jurisdiction of incorporation or organization)
|
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(I.R.S. Employer Identification No.)
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Title of Each Class
|
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Name of Each Exchange
on Which Registered
|
Common Stock, par value $5.00
|
|
New York Stock Exchange
|
Depositary Shares Each Representing a 1/4,000 Interest in a Share of Fixed-to-
Floating Rate Non-Cumulative Perpetual Preferred Stock, Series P
|
|
New York Stock Exchange
|
Depositary Shares Each Representing a 1/4,000 Interest in a Share of 5.375%
Non-Cumulative Perpetual Preferred Stock, Series Q
|
|
New York Stock Exchange
|
Warrants (expiring December 31, 2018) to purchase Common Stock
|
|
New York Stock Exchange
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Large accelerated filer
X
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Accelerated filer
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Non-accelerated filer
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Smaller reporting company
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Emerging growth company
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Page
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PART I
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Item 1
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Item 1A
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Item 1B
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Item 2
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Item 3
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Item 4
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PART II
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Item 5
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Item 6
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Item 7
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Item 7A
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Item 8
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Page
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Item 8
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Financial Statements and Supplementary Data. (continued)
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Item 9
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Item 9A
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Item 9B
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PART III
|
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|
|
Item 10
|
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Item 11
|
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Item 12
|
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Item 13
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Item 14
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PART IV
|
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Item 15
|
||
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Item 16
|
||
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Table
|
Description
|
Page
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|
|
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
||
12
|
||
13
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||
14
|
||
15
|
||
16
|
||
17
|
||
18
|
||
19
|
||
20
|
||
21
|
||
22
|
||
23
|
||
24
|
||
25
|
||
26
|
||
27
|
||
28
|
||
29
|
||
30
|
||
31
|
||
32
|
||
33
|
||
34
|
||
35
|
Table
|
Description
|
Page
|
|
|
|
36
|
||
37
|
||
38
|
||
39
|
||
40
|
||
41
|
||
42
|
||
43
|
||
44
|
||
45
|
||
46
|
||
47
|
||
48
|
||
49
|
||
50
|
||
51
|
||
52
|
||
53
|
||
54
|
||
55
|
||
56
|
||
57
|
||
58
|
||
59
|
||
60
|
||
61
|
||
62
|
||
63
|
||
64
|
||
65
|
||
66
|
||
67
|
||
68
|
Table
|
Description
|
Page
|
|
|
|
69
|
||
70
|
||
71
|
||
72
|
||
73
|
||
74
|
||
75
|
||
76
|
||
77
|
||
78
|
||
79
|
||
80
|
||
81
|
||
82
|
||
83
|
||
84
|
||
85
|
||
86
|
||
87
|
||
88
|
||
89
|
||
90
|
||
91
|
||
92
|
||
93
|
||
94
|
||
95
|
||
96
|
||
97
|
||
98
|
||
99
|
||
100
|
||
101
|
||
102
|
||
103
|
•
|
Retail Banking
|
•
|
Corporate & Institutional Banking
|
•
|
Asset Management Group
|
•
|
BlackRock
|
|
Form 10-K page
|
Average Consolidated Balance Sheet And Net
Interest Analysis
|
158
|
Analysis Of Year-To-Year Changes
In Net Interest Income
|
159
|
Book Values Of Securities
|
37 and 108-111
|
Maturities And Weighted-Average Yield Of
Securities
|
37 and 110-111
|
Loan Types
|
36, 53, 98-99 and 160
|
Selected Loan Maturities And Interest Sensitivity
|
163
|
Nonaccrual, Past Due And Restructured Loans And
Other Nonperforming Assets
|
53-59, 87-90, 97-105 and 161
|
Potential Problem Loans
|
53-59
|
Summary Of Loan Loss Experience
|
58-59, 106-107 and 162
|
Allocation Of Allowance For Loan And Lease
Losses
|
58-59 and 162
|
Average Amount And Average Rate Paid On
Deposits
|
158
|
Time Deposits Of $100,000 Or More
|
163
|
Selected Consolidated Financial Data
|
28-29
|
Short-term Borrowings – not included as average
balances during 2017, 2016, and 2015 were less
than 30% of total shareholders’ equity at the end
of each period.
|
|
•
|
Other commercial banks,
|
•
|
Savings banks,
|
•
|
Credit unions,
|
•
|
Consumer finance companies,
|
•
|
Leasing companies,
|
•
|
Other non-bank lenders,
|
•
|
Financial technology companies,
|
•
|
Treasury management service companies,
|
•
|
Insurance companies, and
|
•
|
Issuers of commercial paper and other securities, including mutual funds.
|
•
|
Investment management firms,
|
•
|
Large banks and other financial institutions,
|
•
|
Brokerage firms,
|
•
|
Financial technology companies,
|
•
|
Mutual fund complexes, and
|
•
|
Insurance companies.
|
•
|
Commercial banks,
|
•
|
Investment banking firms,
|
•
|
Collateralized loan obligation (CLO) managers,
|
•
|
Hedge funds,
|
•
|
Mutual fund complexes,
|
•
|
Merchant banks,
|
•
|
Insurance companies,
|
•
|
Private equity firms, and
|
•
|
Other investment vehicles.
|
•
|
Changes in interest rates or interest rate spreads can affect the difference between the interest that we earn on assets and the interest that we pay on liabilities, which impacts our overall net interest income and margin as well as our profitability.
|
•
|
Such changes can affect the ability of borrowers to meet obligations under variable or adjustable rate loans and other debt instruments, and can, in turn, affect our loss rates on those assets.
|
•
|
Such changes may decrease the demand for interest rate-based products and services, including loans and deposit accounts.
|
•
|
Such changes can also affect our ability to hedge various forms of market and interest rate risk and may decrease the effectiveness of those hedges in helping to manage such risks.
|
•
|
Movements in interest rates also affect mortgage prepayment speeds and could result in impairments of mortgage servicing assets or otherwise affect the profitability of such assets.
|
•
|
Increases in interest rates can lower the price we would receive on fixed-rate customer obligations if we were to sell them.
|
Name
|
Age
|
|
Position with PNC
|
Year
Employed (a)
|
William S. Demchak
|
55
|
|
Chairman, President and
Chief Executive
Officer (b)
|
2002
|
Orlando C. Esposito
|
59
|
|
Executive Vice
President
|
1988
|
Michael J. Hannon
|
61
|
|
Executive Vice
President and Chief
Credit Officer
|
1982
|
Vicki C. Henn
|
49
|
|
Executive Vice
President and Chief
Human Resources
Officer
|
1994
|
Gregory B. Jordan
|
58
|
|
Executive Vice
President, General
Counsel and Chief
Administrative
Officer
|
2013
|
Stacy M. Juchno
|
42
|
|
Executive Vice
President and General
Auditor
|
2009
|
Karen L. Larrimer
|
55
|
|
Executive Vice
President, Chief
Customer Officer and
Head of Retail
Banking
|
1995
|
Michael P. Lyons
|
47
|
|
Executive Vice
President, Head of
Corporate &
Institutional Banking
and Head of Asset
Management Group
|
2011
|
E William Parsley, III
|
52
|
|
Executive Vice
President and Chief
Operating Officer
|
2003
|
Robert Q. Reilly
|
53
|
|
Executive Vice
President and Chief
Financial Officer
|
1987
|
Joseph E. Rockey
|
53
|
|
Executive Vice
President and Chief
Risk Officer
|
1999
|
Steven Van Wyk
|
59
|
|
Executive Vice
President and Head of
Technology and
Innovation
|
2013
|
Gregory H. Kozich
|
54
|
|
Senior Vice President
and Controller
|
2010
|
(a)
|
Where applicable, refers to year employed by predecessor company.
|
(b)
|
Mr. Demchak also serves as a director. Biographical information for Mr. Demchak is included in “Election of Directors (Item 1)” in our proxy statement for the
2018
annual meeting of shareholders. See Item 10 of this Report.
|
•
|
Charles E. Bunch, 68, Retired Executive Chairman of PPG Industries, Inc. (
coatings, sealants and glass products
) (2007)
|
•
|
Debra A. Cafaro, 60, Chairman of the Board and Chief Executive Officer of Ventas, Inc. (
real estate investment trust)
(2017)
|
•
|
Marjorie Rodgers Cheshire, 49, President and Chief Operating Officer of A&R Development Corp.
(real estate development company)
(2014)
|
•
|
William S. Demchak, 55, Chairman, President and Chief Executive Officer of PNC (2013)
|
•
|
Andrew T. Feldstein, 53, Chief Executive Officer and Chief Investment Officer of BlueMountain Capital Management, LLC (
asset management firm)
(2013)
|
•
|
Daniel R. Hesse, 64, Retired President and Chief Executive Officer of Sprint Corporation (
telecommunications
) (2016)
|
•
|
Richard B. Kelson, 71, Chairman, President and Chief Executive Officer of ServCo LLC (
strategic sourcing, supply chain management
) (2002)
|
•
|
Linda R. Medler, 61, Retired Brigadier General, United States Air Force and President and Chief Executive Officer of L A Medler & Associates, LLC (
cyber strategy consulting services)
(2018)
|
•
|
Jane G. Pepper, 72, Retired President of the Pennsylvania Horticultural Society (
non-profit
) (1997)
|
•
|
Martin Pfinsgraff, 63, Former Senior Deputy Comptroller of the Office of the Comptroller of the Currency (
federal agency
) (2018)
|
•
|
Donald J. Shepard, 71, Retired Chairman of the Executive Board and Chief Executive Officer of AEGON N.V. (
insurance
) (2007)
|
•
|
Lorene K. Steffes, 72, Independent Business Advisor (
executive, business management and technical expertise
) (2000)
|
•
|
Dennis F. Strigl, 71, Retired President and Chief Operating Officer of Verizon Communications Inc. (
telecommunications
) (2001)
|
•
|
Michael J. Ward, 67, Retired Chairman and Chief Executive Officer of CSX Corporation (
railroads, transportation
) (2016)
|
•
|
Gregory D. Wasson, 59, Retired President and Chief Executive Officer of Walgreens Boots Alliance
(pharmacy, health and wellbeing enterprise)
(2015)
|
(b)
|
Not applicable.
|
(c)
|
Details of our repurchases of PNC common stock during the fourth quarter of
2017
are included in the following table:
|
2017 period
|
Total shares
purchased (a)
|
|
Average
price
paid per
share
|
|
Total shares
purchased as
part of
publicly
announced
programs (b)
|
|
Maximum
number of
shares that
may yet be
purchased
under the
programs (b)
|
|
|
October 1 – 31
|
1,092
|
|
$
|
135.97
|
|
1,065
|
|
43,308
|
|
November 1 – 30
|
1,159
|
|
$
|
134.65
|
|
1,159
|
|
42,149
|
|
December 1 – 31
|
1,512
|
|
$
|
144.56
|
|
1,512
|
|
40,637
|
|
Total
|
3,763
|
|
$
|
139.01
|
|
|
|
(a)
|
Includes PNC common stock purchased in connection with our various employee benefit plans generally related to forfeitures of unvested restricted stock awards and shares used to cover employee payroll tax withholding requirements. Note 11 Employee Benefit Plans and Note 12 Stock Based Compensation Plans in the Notes To Consolidated Financial Statements in Item 8 of this Report include additional information regarding our employee benefit and equity compensation plans that use PNC common stock.
|
(b)
|
On March 11 2015, we announced that our Board of Directors approved the establishment of a stock repurchase program authorization in the amount of 100 million shares of PNC common stock, effective April 1, 2015. Repurchases are made in open market or privately negotiated transactions and the timing and exact amount of common stock repurchases will depend on a number of factors including, among others, market and general economic conditions, regulatory capital considerations, alternative uses of capital, the potential impact on our credit ratings, and contractual and regulatory limitations, including the results of the supervisory assessment of capital adequacy and capital planning processes undertaken by the Federal Reserve as part of the CCAR process. In June
2017
, we announced share repurchase programs of up to $2.7 billion for the four quarter period beginning with the third quarter of
2017
, including repurchases of up to $300 million related to employee benefit plans, in accordance with PNC's 2017 capital plan. In the fourth quarter of
2017
,we repurchased
3.7 million
shares of common stock on the open market, with an average price of $
139.05
per share and an aggregate repurchase price of $
.5 billion
. See the Liquidity and Capital Management portion of the Risk Management section in Item 7 of this Report for more information on the share repurchase programs for the period July 1, 2017 through June 30, 2018 included in the
2017
capital plan accepted by the Federal Reserve.
|
|
Base
Period
|
|
Assumes $100 investment at Close of
Market on December 31, 2012
Total Return = Price change plus
reinvestment of dividends
|
|
5-Year
Compound
Growth
Rate
|
|
||||||||||||||
|
Dec. 2012
|
|
Dec. 2013
|
|
Dec. 2014
|
|
Dec. 2015
|
|
Dec. 2016
|
|
Dec. 2017
|
|
|
|||||||
PNC
|
$
|
100
|
|
$
|
136.45
|
|
$
|
164.18
|
|
$
|
175.35
|
|
$
|
220.56
|
|
$
|
277.82
|
|
22.67
|
%
|
S&P 500 Index
|
$
|
100
|
|
$
|
132.37
|
|
$
|
150.48
|
|
$
|
152.55
|
|
$
|
170.78
|
|
$
|
208.05
|
|
15.78
|
%
|
S&P 500 Banks
|
$
|
100
|
|
$
|
135.72
|
|
$
|
156.78
|
|
$
|
158.10
|
|
$
|
196.54
|
|
$
|
240.87
|
|
19.22
|
%
|
Peer Group
|
$
|
100
|
|
$
|
135.48
|
|
$
|
151.18
|
|
$
|
145.75
|
|
$
|
197.16
|
|
$
|
238.65
|
|
19.00
|
%
|
|
Year ended December 31
|
|
||||||||||||||||||
Dollars in millions, except per share data
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||||
Summary of Operations
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income
|
$
|
10,814
|
|
|
$
|
9,652
|
|
|
$
|
9,323
|
|
|
$
|
9,431
|
|
|
$
|
10,007
|
|
|
Interest expense
|
1,706
|
|
|
1,261
|
|
|
1,045
|
|
|
906
|
|
|
860
|
|
|
|||||
Net interest income
|
9,108
|
|
|
8,391
|
|
|
8,278
|
|
|
8,525
|
|
|
9,147
|
|
|
|||||
Noninterest income
|
7,221
|
|
|
6,771
|
|
|
6,947
|
|
|
6,850
|
|
|
6,865
|
|
|
|||||
Total revenue
|
16,329
|
|
|
15,162
|
|
|
15,225
|
|
|
15,375
|
|
|
16,012
|
|
|
|||||
Provision for credit losses
|
441
|
|
|
433
|
|
|
255
|
|
|
273
|
|
|
643
|
|
|
|||||
Noninterest expense
|
10,398
|
|
|
9,476
|
|
|
9,463
|
|
|
9,488
|
|
|
9,681
|
|
|
|||||
Income before income taxes and noncontrolling interests
|
5,490
|
|
|
5,253
|
|
|
5,507
|
|
|
5,614
|
|
|
5,688
|
|
|
|||||
Income taxes
|
102
|
|
|
1,268
|
|
|
1,364
|
|
|
1,407
|
|
|
1,476
|
|
|
|||||
Net income
|
5,388
|
|
|
3,985
|
|
|
4,143
|
|
|
4,207
|
|
|
4,212
|
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
50
|
|
|
82
|
|
|
37
|
|
|
23
|
|
|
11
|
|
|
|||||
Preferred stock dividends
|
236
|
|
|
209
|
|
|
220
|
|
|
232
|
|
|
237
|
|
|
|||||
Preferred stock discount accretion and redemptions
|
26
|
|
|
6
|
|
|
5
|
|
|
5
|
|
|
12
|
|
|
|||||
Net income attributable to common shareholders
|
$
|
5,076
|
|
|
$
|
3,688
|
|
|
$
|
3,881
|
|
|
$
|
3,947
|
|
|
$
|
3,952
|
|
|
Per Common Share
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings
|
$
|
10.49
|
|
|
$
|
7.42
|
|
|
$
|
7.52
|
|
|
$
|
7.44
|
|
|
$
|
7.45
|
|
|
Diluted earnings
|
$
|
10.36
|
|
|
$
|
7.30
|
|
|
$
|
7.39
|
|
|
$
|
7.30
|
|
|
$
|
7.36
|
|
|
Book value
|
$
|
91.94
|
|
|
$
|
85.94
|
|
|
$
|
81.84
|
|
|
$
|
77.61
|
|
|
$
|
72.07
|
|
|
Cash dividends declared
|
$
|
2.60
|
|
|
$
|
2.12
|
|
|
$
|
2.01
|
|
|
$
|
1.88
|
|
|
$
|
1.72
|
|
|
Effective tax rate (a)
|
1.9
|
%
|
|
24.1
|
%
|
|
24.8
|
%
|
|
25.1
|
%
|
|
25.9
|
%
|
|
(a)
|
The effective tax rates are generally lower than the statutory rate due to the relationship of pretax income to tax credits and earnings that are not subject to tax. The full year 2017 results benefited from the new federal tax legislation. Certain tax legislation amounts are considered reasonable estimates as of December 31, 2017. See the Critical Accounting Estimates and Judgments section in Item 7 of this Report for additional details.
|
|
At or for the year ended December 31
|
|
||||||||||||||||||
Dollars in millions, except as noted
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
||||||||||
Balance Sheet Highlights
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets
|
$
|
380,768
|
|
|
$
|
366,380
|
|
|
$
|
358,493
|
|
|
$
|
345,072
|
|
|
$
|
320,192
|
|
|
Loans (a)
|
$
|
220,458
|
|
|
$
|
210,833
|
|
|
$
|
206,696
|
|
|
$
|
204,817
|
|
|
$
|
195,613
|
|
|
Allowance for loan and lease losses
|
$
|
2,611
|
|
|
$
|
2,589
|
|
|
$
|
2,727
|
|
|
$
|
3,331
|
|
|
$
|
3,609
|
|
|
Interest-earning deposits with banks (b)
|
$
|
28,595
|
|
|
$
|
25,711
|
|
|
$
|
30,546
|
|
|
$
|
31,779
|
|
|
$
|
12,135
|
|
|
Investment securities
|
$
|
76,131
|
|
|
$
|
75,947
|
|
|
$
|
70,528
|
|
|
$
|
55,823
|
|
|
$
|
60,294
|
|
|
Loans held for sale (a)
|
$
|
2,655
|
|
|
$
|
2,504
|
|
|
$
|
1,540
|
|
|
$
|
2,262
|
|
|
$
|
2,255
|
|
|
Equity investments (c)
|
$
|
11,392
|
|
|
$
|
10,728
|
|
|
$
|
10,587
|
|
|
$
|
10,728
|
|
|
$
|
10,560
|
|
|
Mortgage servicing rights
|
$
|
1,832
|
|
|
$
|
1,758
|
|
|
$
|
1,589
|
|
|
$
|
1,351
|
|
|
$
|
1,636
|
|
|
Goodwill
|
$
|
9,173
|
|
|
$
|
9,103
|
|
|
$
|
9,103
|
|
|
$
|
9,103
|
|
|
$
|
9,074
|
|
|
Other assets (a)
|
$
|
27,894
|
|
|
$
|
27,506
|
|
|
$
|
26,566
|
|
|
$
|
28,180
|
|
|
$
|
28,191
|
|
|
Noninterest-bearing deposits
|
$
|
79,864
|
|
|
$
|
80,230
|
|
|
$
|
79,435
|
|
|
$
|
73,479
|
|
|
$
|
70,306
|
|
|
Interest-bearing deposits
|
$
|
185,189
|
|
|
$
|
176,934
|
|
|
$
|
169,567
|
|
|
$
|
158,755
|
|
|
$
|
150,625
|
|
|
Total deposits
|
$
|
265,053
|
|
|
$
|
257,164
|
|
|
$
|
249,002
|
|
|
$
|
232,234
|
|
|
$
|
220,931
|
|
|
Borrowed funds (a) (d)
|
$
|
59,088
|
|
|
$
|
52,706
|
|
|
$
|
54,532
|
|
|
$
|
56,768
|
|
|
$
|
46,105
|
|
|
Total shareholders’ equity
|
$
|
47,513
|
|
|
$
|
45,699
|
|
|
$
|
44,710
|
|
|
$
|
44,551
|
|
|
$
|
42,334
|
|
|
Common shareholders’ equity
|
$
|
43,530
|
|
|
$
|
41,723
|
|
|
$
|
41,258
|
|
|
$
|
40,605
|
|
|
$
|
38,392
|
|
|
Accumulated other comprehensive income (loss)
|
$
|
(148
|
)
|
|
$
|
(265
|
)
|
|
$
|
130
|
|
|
$
|
503
|
|
|
$
|
436
|
|
|
Period-end common shares outstanding (millions)
|
473
|
|
|
485
|
|
|
504
|
|
|
523
|
|
|
533
|
|
|
|||||
Client Investment Assets
(billions)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Discretionary client assets under management
|
$
|
151
|
|
|
$
|
137
|
|
|
$
|
134
|
|
|
$
|
135
|
|
|
$
|
127
|
|
|
Nondiscretionary client assets under administration
|
131
|
|
|
120
|
|
|
119
|
|
|
123
|
|
|
116
|
|
|
|||||
Total client assets under administration (e)
|
282
|
|
|
257
|
|
|
253
|
|
|
258
|
|
|
243
|
|
|
|||||
Brokerage account client assets
|
49
|
|
|
44
|
|
|
43
|
|
|
43
|
|
|
41
|
|
|
|||||
Total
|
$
|
331
|
|
|
$
|
301
|
|
|
$
|
296
|
|
|
$
|
301
|
|
|
$
|
284
|
|
|
Selected Ratios
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest margin (f)
|
2.87
|
%
|
|
2.73
|
%
|
|
2.74
|
%
|
|
3.08
|
%
|
|
3.57
|
%
|
|
|||||
Noninterest income to total revenue
|
44
|
%
|
|
45
|
%
|
|
46
|
%
|
|
45
|
%
|
|
43
|
%
|
|
|||||
Efficiency
|
64
|
%
|
|
62
|
%
|
|
62
|
%
|
|
62
|
%
|
|
60
|
%
|
|
|||||
Return on
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average common shareholders’ equity (g)
|
12.09
|
%
|
|
8.85
|
%
|
|
9.50
|
%
|
|
9.91
|
%
|
|
10.85
|
%
|
|
|||||
Average assets (g)
|
1.45
|
%
|
|
1.10
|
%
|
|
1.17
|
%
|
|
1.28
|
%
|
|
1.38
|
%
|
|
|||||
Loans to deposits
|
83
|
%
|
|
82
|
%
|
|
83
|
%
|
|
88
|
%
|
|
89
|
%
|
|
|||||
Dividend payout
|
24.7
|
%
|
|
29.0
|
%
|
|
27.0
|
%
|
|
25.3
|
%
|
|
23.1
|
%
|
|
|||||
Transitional Basel III common equity Tier 1 capital ratio (h) (i) (j)
|
10.4
|
%
|
|
10.6
|
%
|
|
10.6
|
%
|
|
10.9
|
%
|
|
N/A
|
|
|
|||||
Transitional Basel III Tier 1 risk-based capital ratio (h) (i) (j)
|
11.6
|
%
|
|
12.0
|
%
|
|
12.0
|
%
|
|
12.6
|
%
|
|
N/A
|
|
|
|||||
Pro forma fully phased-in Basel III common equity Tier 1 capital ratio
(Non-GAAP) (i) (j) (k)
|
9.8
|
%
|
|
10.0
|
%
|
|
10.0
|
%
|
|
10.0
|
%
|
|
9.4
|
%
|
|
|||||
Basel I Tier 1 common capital ratio (j)
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
10.5
|
%
|
|
|||||
Basel I Tier 1 risk-based capital ratio (j)
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
12.4
|
%
|
|
|||||
Common shareholders’ equity to total assets
|
11.4
|
%
|
|
11.4
|
%
|
|
11.5
|
%
|
|
11.8
|
%
|
|
12.0
|
%
|
|
|||||
Average common shareholders’ equity to average assets
|
11.3
|
%
|
|
11.5
|
%
|
|
11.5
|
%
|
|
12.1
|
%
|
|
11.9
|
%
|
|
|||||
Selected Statistics
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Employees
|
52,906
|
|
|
52,006
|
|
|
52,513
|
|
|
53,587
|
|
|
54,433
|
|
|
|||||
Retail Banking branches
|
2,459
|
|
|
2,520
|
|
|
2,616
|
|
|
2,697
|
|
|
2,714
|
|
|
|||||
ATMs
|
9,051
|
|
|
9,024
|
|
|
8,956
|
|
|
8,605
|
|
|
7,445
|
|
|
(a)
|
Includes assets and liabilities for which we have elected the fair value option. See the Consolidated Balance Sheet and Note
6
Fair Value
in Item 8 of this Report for additional information.
|
(b)
|
Includes balances held with the Federal Reserve Bank of Cleveland of
$28.3
billion, $
25.1
billion, $30.0 billion, $31.4 billion and $11.7 billion as of December 31,
2017
,
2016
,
2015
,
2014
and
2013
, respectively.
|
(c)
|
Includes our equity interest in BlackRock.
|
(d)
|
Includes long-term borrowings of $
43.1 billion
, $38.3 billion, $43.6 billion, $41.5 billion and $27.6 billion for
2017
,
2016
,
2015
,
2014
and
2013
, respectively. Borrowings which mature more than one year after December 31,
2017
are considered to be long-term.
|
(e)
|
As a result of certain investment advisory services performed by one of our registered investment advisors, certain assets were previously reported as both discretionary client assets under management and nondiscretionary client assets under administration. Effective for the first quarter of 2017, these amounts are only reported as discretionary assets under management. Prior periods were adjusted to remove amounts previously included in nondiscretionary assets under administration of approximately $9 billion, $6 billion, $5 billion and $4 billion at December 31,
2016
,
2015
,
2014
and
2013
, respectively.
|
(f)
|
Calculated as taxable-equivalent net interest income divided by average earning assets. To provide more meaningful comparisons of net interest margins, we use net interest income on a taxable-equivalent basis in calculating net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP in the Consolidated Income Statement. For additional information, see Reconciliation of Taxable-Equivalent Net Interest Income Statistical Information (Unaudited) in Item 8 of this Report.
|
(g)
|
The full year 2017 results benefited from the new federal tax legislation. Certain tax legislation amounts are considered reasonable estimates as of December 31, 2017. See the Critical Accounting Estimates and Judgments section in Item 7 of this Report for additional details.
|
(h)
|
Calculated using the regulatory capital methodology applicable to us during each period presented.
|
(i)
|
See capital ratios discussion in the Supervision and Regulation section of Item 1 and in the Liquidity and Capital Management portion of the Risk Management section in Item 7 of this Report for additional discussion on these capital ratios.
|
(j)
|
See additional information on the pro forma ratios, Transitional Basel III ratios and the Basel I ratios in the Statistical Information (Unaudited) section in Item 8 of this Report.
|
(k)
|
The pro forma ratios for all periods presented were calculated under the standardized approach. The 2013 ratio has not been updated to reflect the first quarter 2014 adoption of ASU 2014-01 related to investments in low income housing tax credits.
|
•
|
Expanding our leading banking franchise to new markets and digital platforms;
|
•
|
Deepening customer relationships by delivering a superior banking experience and financial solutions; and
|
•
|
Leveraging technology to innovate and enhance products, services, security and processes.
|
•
|
Global and domestic economic conditions, including the continuity, speed and stamina of the current U.S. economic expansion;
|
•
|
The monetary policy actions and statements of the Federal Reserve and the Federal Open Market Committee (FOMC);
|
•
|
The level of, and direction, timing and magnitude of movement in, interest rates and the shape of the interest rate yield curve;
|
•
|
The functioning and other performance of, and availability of liquidity in, the capital and other financial markets;
|
•
|
Changes in the competitive and regulatory landscape;
|
•
|
The impact of legislative, regulatory and administrative initiatives and actions;
|
•
|
The impact of market credit spreads on asset valuations;
|
•
|
The ability of customers, counterparties and issuers to perform in accordance with contractual terms, and the resulting impact on our asset quality;
|
•
|
Loan demand, utilization of credit commitments and standby letters of credit; and
|
•
|
The impact on customers and changes in customer behavior due to changing business and economic conditions or regulatory or legislative initiatives, including newly enacted federal tax legislation.
|
•
|
Effectively managing capital and liquidity including:
|
•
|
Continuing to maintain and grow our deposit base as a low-cost stable funding source;
|
•
|
Prudent liquidity and capital management to meet evolving regulatory capital, capital planning, stress testing and liquidity standards; and
|
•
|
Actions we take within the capital and other financial markets.
|
•
|
Management of credit risk in our portfolio;
|
•
|
Execution of our strategic priorities;
|
•
|
Our ability to manage and implement strategic business objectives within the changing regulatory environment;
|
•
|
The impact of legal and regulatory-related contingencies; and
|
•
|
The appropriateness of reserves needed for critical accounting estimates and related contingencies.
|
•
|
Total revenue increased $1.2 billion, or 8%, to
$16.3 billion
.
|
•
|
Net interest income increased $717 million, or 9%, to
$9.1 billion
.
|
•
|
Net interest margin increased to 2.87% for
2017
compared to 2.73% for
2016
.
|
•
|
Noninterest income increased $450 million, or 7%, to
$7.2 billion
.
|
•
|
Provision for credit losses was
$441 million
in
2017
compared to $
433 million
for
2016
.
|
•
|
Noninterest expense increased $922 million, or 10%, to
$10.4 billion
.
|
•
|
Income tax expense decreased to $102 million in
2017
compared to $1.3 billion in 2016.
|
•
|
Total revenue - increase of $28 million.
|
•
|
Net interest income - decrease of $26 million due to the impact of tax legislation on leveraged leases.
|
•
|
Noninterest income - increase of $54 million consisting of :
|
•
|
$254 million increase in asset management noninterest income as a result of the flow through impact of tax legislation from our equity investment in BlackRock.
|
•
|
$119 million increase in other noninterest income for appreciation of BlackRock common stock contributed to the PNC Foundation.
|
•
|
Negative fair value adjustments in the fourth quarter of 2017 of $248 million in other noninterest income related to Visa Class B derivatives and $71 million in residential mortgage noninterest income for servicing rights assumption updates.
|
•
|
Noninterest expense - increase of $502 million consisting of:
|
•
|
$200 million contribution of BlackRock common stock to the PNC Foundation.
|
•
|
$197 million of charges for real estate dispositions and exits.
|
•
|
$105 million for employee cash payments and pension account credits.
|
•
|
Income tax expense - benefit of $1.2 billion from tax legislation primarily attributable to revaluation of net deferred tax liabilities and $230 million from the tax effect of the aforementioned other significant items.
|
•
|
Total loans increased $9.6 billion, or 5%, to
$220.5 billion
.
|
•
|
Total commercial lending grew $9.5 billion, or 7%.
|
•
|
Total consumer lending increased $.1 billion.
|
•
|
Total deposits increased $7.9 billion, or 3%, to
$265.1 billion
.
|
•
|
Investment securities increased $.2 billion to
$76.1 billion
.
|
•
|
Interest earning deposits with banks, primarily with the Federal Reserve Bank, increased $2.9 billion, or 11%, to $28.6 billion.
|
•
|
Nonperforming assets decreased $339 million, or 14%, to $2.0 billion at
December 31, 2017
compared to December 31, 2016.
|
•
|
Overall loan delinquencies of $1.5 billion at
December 31, 2017
decreased $56 million, or 4%, compared to
December 31, 2016
.
|
•
|
Net charge-offs of
$457 million
in
2017
decreased compared to net charge-offs of
$543 million
for
2016
.
|
•
|
The allowance for loan and lease losses to total loans was 1.18% at
December 31, 2017
compared to 1.23% at
December 31, 2016
.
|
•
|
The Transitional Basel III common equity Tier 1 capital ratio was 10.4% at
December 31, 2017
compared to 10.6% at
December 31, 2016
.
|
•
|
Pro forma fully phased-in Basel III common equity Tier 1 capital ratio, a non-GAAP financial measure, was an estimated 9.8% at
December 31, 2017
compared to 10.0% at
December 31, 2016
based on the standardized approach rules.
|
•
|
For the full year
2017
, we returned $3.6 billion of capital to shareholders through repurchases of 18.6 million common shares for $2.3 billion and dividends on common shares of $1.3 billion.
|
•
|
Common shareholders’ equity increased to $43.5 billion at
December 31, 2017
compared to $41.7 billion at
December 31, 2016
.
|
•
|
Loan growth to be up mid-single digits, on a percentage basis;
|
•
|
Revenue to increase mid-single digits, on a percentage basis;
|
•
|
Noninterest expense to increase by low-single digits, on a percentage basis; and
|
•
|
The effective tax rate to be approximately 17%.
|
•
|
Modest loan growth;
|
•
|
Stable net interest income;
|
•
|
Fee income to decrease by low mid-single digits, on a percentage basis, mainly attributable to lower first quarter client activity and elevated fourth quarter fees. Fee income consists of asset management, consumer services, corporate services, residential mortgage and service charges on deposits;
|
•
|
Other noninterest income to be between $250 million and $300 million;
|
•
|
Provision for credit losses to be between $100 million and $150 million; and
|
•
|
Noninterest expense to decrease by low-single digits, on a percentage basis.
|
|
2017
|
|
2016
|
||||||||||||||
Year Ended December 31
Dollars in millions
|
Average
Balances
|
|
Average
Yields/
Rates
|
|
Interest
Income/
Expense
|
|
|
Average
Balances
|
|
Average
Yields/
Rates
|
|
Interest
Income/
Expense
|
|
||||
Assets
|
|
|
|
|
|
|
|
||||||||||
Interest-earning assets
|
|
|
|
|
|
|
|
||||||||||
Investment securities
|
$
|
75,057
|
|
2.74
|
%
|
$
|
2,059
|
|
|
$
|
72,046
|
|
2.62
|
%
|
$
|
1,889
|
|
Loans
|
217,271
|
|
3.86
|
%
|
8,390
|
|
|
208,817
|
|
3.61
|
%
|
7,543
|
|
||||
Interest-earning deposits with banks
|
24,043
|
|
1.11
|
%
|
267
|
|
|
26,328
|
|
.52
|
%
|
136
|
|
||||
Other
|
8,983
|
|
3.48
|
%
|
313
|
|
|
7,843
|
|
3.56
|
%
|
279
|
|
||||
Total interest-earning assets/interest income
|
$
|
325,354
|
|
3.39
|
%
|
11,029
|
|
|
$
|
315,034
|
|
3.13
|
%
|
9,847
|
|
||
Liabilities
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing liabilities
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing deposits
|
$
|
179,447
|
|
.35
|
%
|
623
|
|
|
$
|
172,764
|
|
.25
|
%
|
430
|
|
||
Borrowed funds
|
56,889
|
|
1.90
|
%
|
1,083
|
|
|
52,939
|
|
1.57
|
%
|
831
|
|
||||
Total interest-bearing liabilities/interest expense
|
$
|
236,336
|
|
.72
|
%
|
1,706
|
|
|
$
|
225,703
|
|
.56
|
%
|
1,261
|
|
||
Net interest income/margin (Non-GAAP)
|
|
2.87
|
%
|
9,323
|
|
|
|
2.73
|
%
|
8,586
|
|
||||||
Taxable-equivalent adjustments
|
|
|
(215
|
)
|
|
|
|
(195
|
)
|
||||||||
Net interest income (GAAP)
|
|
|
$
|
9,108
|
|
|
|
|
$
|
8,391
|
|
(a)
|
Interest income calculated as taxable-equivalent interest income. To provide more meaningful comparisons of interest income and yields for all interest-earning assets, as well as net interest margins, we use interest income on a taxable-equivalent basis in calculating average yields and net interest margins by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP on the Consolidated Income Statement. For more information, see Reconciliation of Taxable-Equivalent Net Interest Income in the Statistical Information (Unaudited) section in Item 8 of this Report.
|
Year ended December 31
|
|
|
Change
|
||||||||
Dollars in millions
|
2017
|
|
2016
|
|
$
|
|
%
|
||||
Noninterest income
|
|
|
|
|
|||||||
Asset management
|
$
|
1,942
|
|
$
|
1,521
|
|
$
|
421
|
|
28
|
%
|
Consumer services
|
1,415
|
|
1,388
|
|
27
|
|
2
|
%
|
|||
Corporate services
|
1,621
|
|
1,504
|
|
117
|
|
8
|
%
|
|||
Residential mortgage
|
350
|
|
567
|
|
(217
|
)
|
(38
|
)%
|
|||
Service charges on deposits
|
695
|
|
667
|
|
28
|
|
4
|
%
|
|||
Other
|
1,198
|
|
1,124
|
|
74
|
|
7
|
%
|
|||
Total noninterest income
|
$
|
7,221
|
|
$
|
6,771
|
|
$
|
450
|
|
7
|
%
|
Year ended December 31
|
|
|
Change
|
||||||||
Dollars in millions
|
2017
|
|
2016
|
|
$
|
|
%
|
||||
Noninterest expense
|
|
|
|
|
|||||||
Personnel
|
$
|
5,224
|
|
$
|
4,841
|
|
$
|
383
|
|
8
|
%
|
Occupancy
|
868
|
|
861
|
|
7
|
|
1
|
%
|
|||
Equipment
|
1,065
|
|
974
|
|
91
|
|
9
|
%
|
|||
Marketing
|
244
|
|
247
|
|
(3
|
)
|
(1
|
)%
|
|||
Other
|
2,997
|
|
2,553
|
|
444
|
|
17
|
%
|
|||
Total noninterest expense
|
$
|
10,398
|
|
$
|
9,476
|
|
$
|
922
|
|
10
|
%
|
|
December 31
|
|
|
December 31
|
|
|
Change
|
|
||||||
Dollars in millions
|
2017
|
|
|
2016
|
|
|
$
|
%
|
|
|||||
Assets
|
|
|
|
|
|
|
|
|||||||
Interest-earning deposits with banks
|
$
|
28,595
|
|
|
$
|
25,711
|
|
|
$
|
2,884
|
|
11
|
%
|
|
Loans held for sale
|
2,655
|
|
|
2,504
|
|
|
151
|
|
6
|
%
|
|
|||
Investment securities
|
76,131
|
|
|
75,947
|
|
|
184
|
|
—
|
|
|
|||
Loans
|
220,458
|
|
|
210,833
|
|
|
9,625
|
|
5
|
%
|
|
|||
Allowance for loan and lease losses
|
(2,611
|
)
|
|
(2,589
|
)
|
|
(22
|
)
|
(1
|
)%
|
|
|||
Mortgage servicing rights
|
1,832
|
|
|
1,758
|
|
|
74
|
|
4
|
%
|
|
|||
Goodwill
|
9,173
|
|
|
9,103
|
|
|
70
|
|
1
|
%
|
|
|||
Other, net
|
44,535
|
|
|
43,113
|
|
|
1,422
|
|
3
|
%
|
|
|||
Total assets
|
$
|
380,768
|
|
|
$
|
366,380
|
|
|
$
|
14,388
|
|
4
|
%
|
|
Liabilities
|
|
|
|
|
|
|
|
|||||||
Deposits
|
$
|
265,053
|
|
|
$
|
257,164
|
|
|
$
|
7,889
|
|
3
|
%
|
|
Borrowed funds
|
59,088
|
|
|
52,706
|
|
|
6,382
|
|
12
|
%
|
|
|||
Other
|
9,042
|
|
|
9,656
|
|
|
(614
|
)
|
(6
|
)%
|
|
|||
Total liabilities
|
333,183
|
|
|
319,526
|
|
|
13,657
|
|
4
|
%
|
|
|||
Equity
|
|
|
|
|
|
|
|
|||||||
Total shareholders’ equity
|
47,513
|
|
|
45,699
|
|
|
1,814
|
|
4
|
%
|
|
|||
Noncontrolling interests
|
72
|
|
|
1,155
|
|
|
(1,083
|
)
|
(94
|
)%
|
|
|||
Total equity
|
47,585
|
|
|
46,854
|
|
|
731
|
|
2
|
%
|
|
|||
Total liabilities and equity
|
$
|
380,768
|
|
|
$
|
366,380
|
|
|
$
|
14,388
|
|
4
|
%
|
|
•
|
Total assets increased driven by strong loan growth and higher interest-earning deposits with banks;
|
•
|
Total liabilities increased due to deposit growth and higher borrowed funds;
|
•
|
Total equity increased due to higher retained earnings driven by net income, partially offset by common share repurchases and a decline in noncontrolling interests related to the redemption of Perpetual Trust Securities in the first quarter of 2017.
|
|
December 31
|
|
|
December 31
|
|
|
Change
|
|
||||||
Dollars in millions
|
2017
|
|
|
2016
|
|
|
$
|
%
|
|
|||||
Commercial lending
|
|
|
|
|
|
|
|
|||||||
Commercial
|
$
|
110,527
|
|
|
$
|
101,364
|
|
|
$
|
9,163
|
|
9
|
%
|
|
Commercial real
estate
|
28,978
|
|
|
29,010
|
|
|
(32
|
)
|
—
|
|
|
|||
Equipment lease
financing
|
7,934
|
|
|
7,581
|
|
|
353
|
|
5
|
%
|
|
|||
Total commercial
lending
|
147,439
|
|
|
137,955
|
|
|
9,484
|
|
7
|
%
|
|
|||
Consumer lending
|
|
|
|
|
|
|
|
|||||||
Home equity
|
28,364
|
|
|
29,949
|
|
|
(1,585
|
)
|
(5
|
)%
|
|
|||
Residential real
estate
|
17,212
|
|
|
15,598
|
|
|
1,614
|
|
10
|
%
|
|
|||
Credit card
|
5,699
|
|
|
5,282
|
|
|
417
|
|
8
|
%
|
|
|||
Other consumer
|
|
|
|
|
|
|
|
|||||||
Automobile
|
12,880
|
|
|
12,380
|
|
|
500
|
|
4
|
%
|
|
|||
Education
|
4,454
|
|
|
5,159
|
|
|
(705
|
)
|
(14
|
)%
|
|
|||
Other
|
4,410
|
|
|
4,510
|
|
|
(100
|
)
|
(2
|
)%
|
|
|||
Total consumer
lending
|
73,019
|
|
|
72,878
|
|
|
141
|
|
—
|
|
|
|||
Total loans
|
$
|
220,458
|
|
|
$
|
210,833
|
|
|
$
|
9,625
|
|
5
|
%
|
|
|
December 31, 2017
|
|
December 31, 2016
|
|
Ratings (a)
As of December 31, 2017 |
|
|||||||||||||||||||||||||
Dollars in millions
|
Amortized
Cost
|
|
|
Fair
Value
|
|
|
Amortized
Cost
|
|
|
Fair
Value
|
|
|
AAA/
AA
|
|
|
A
|
|
|
BBB
|
|
|
BB
and
Lower
|
|
|
No
Rating
|
|
|
||||
U.S. Treasury and government agencies
|
$
|
15,173
|
|
|
$
|
15,286
|
|
|
$
|
13,627
|
|
|
$
|
13,714
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
||||
Agency residential mortgage-backed
|
40,037
|
|
|
39,847
|
|
|
37,319
|
|
|
37,109
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
||||||||
Non-agency residential mortgage-backed
|
2,610
|
|
|
2,932
|
|
|
3,382
|
|
|
3,564
|
|
|
11
|
%
|
|
|
|
3
|
%
|
|
77
|
%
|
|
9
|
%
|
|
|||||
Agency commercial mortgage-backed
|
2,367
|
|
|
2,315
|
|
|
3,053
|
|
|
3,046
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
||||||||
Non-agency commercial mortgage-backed (b)
|
3,141
|
|
|
3,161
|
|
|
4,590
|
|
|
4,602
|
|
|
81
|
%
|
|
6
|
%
|
|
|
|
|
|
|
|
13
|
%
|
|
||||
Asset-backed (c)
|
5,531
|
|
|
5,598
|
|
|
6,496
|
|
|
6,524
|
|
|
86
|
%
|
|
3
|
%
|
|
5
|
%
|
|
6
|
%
|
|
|
|
|
||||
Other debt (d)
|
6,279
|
|
|
6,459
|
|
|
6,679
|
|
|
6,810
|
|
|
75
|
%
|
|
15
|
%
|
|
7
|
%
|
|
1
|
%
|
|
2
|
%
|
|
||||
Other
|
587
|
|
|
585
|
|
|
603
|
|
|
601
|
|
|
|
|
|
|
|
|
|
|
100
|
%
|
|
||||||||
Total investment securities (e)
|
$
|
75,725
|
|
|
$
|
76,183
|
|
|
$
|
75,749
|
|
|
$
|
75,970
|
|
|
92
|
%
|
|
2
|
%
|
|
1
|
%
|
|
3
|
%
|
|
2
|
%
|
|
(a)
|
Ratings percentages allocated based on amortized cost.
|
(b)
|
Collateralized primarily by retail properties, office buildings, lodging properties and multi-family housing.
|
(c)
|
Collateralized primarily by corporate debt, government guaranteed education loans and other consumer credit products.
|
(d)
|
Includes state and municipal securities.
|
(e)
|
Includes available for sale and held to maturity securities, which are recorded on our balance sheet at fair value and amortized cost, respectively.
|
December 31, 2017
|
Years
|
Agency residential mortgage-backed
|
5.8
|
Non-agency residential mortgage-backed
|
6.0
|
Agency commercial mortgage-backed
|
3.6
|
Non-agency commercial mortgage-backed
|
3.5
|
Asset-backed
|
2.5
|
|
December 31
|
|
|
December 31
|
|
|
Change
|
|
||||||
Dollars in millions
|
2017
|
|
|
2016
|
|
|
$
|
%
|
|
|||||
Deposits
|
|
|
|
|
|
|
|
|
|
|
|
|||
Noninterest-bearing
|
$
|
79,864
|
|
|
$
|
80,230
|
|
|
$
|
(366
|
)
|
—
|
|
|
Interest-bearing
|
|
|
|
|
|
|
|
|||||||
Money market
|
59,735
|
|
|
63,946
|
|
|
(4,211
|
)
|
(7
|
)%
|
|
|||
Demand
|
61,213
|
|
|
58,472
|
|
|
2,741
|
|
5
|
%
|
|
|||
Savings
|
46,980
|
|
|
36,956
|
|
|
10,024
|
|
27
|
%
|
|
|||
Time deposits
|
17,261
|
|
|
17,560
|
|
|
(299
|
)
|
(2
|
)%
|
|
|||
Total deposits
|
265,053
|
|
|
257,164
|
|
|
7,889
|
|
3
|
%
|
|
|||
Borrowed funds
|
|
|
|
|
|
|
|
|||||||
FHLB borrowings
|
21,037
|
|
|
17,549
|
|
|
3,488
|
|
20
|
%
|
|
|||
Bank notes and
senior debt
|
28,062
|
|
|
22,972
|
|
|
5,090
|
|
22
|
%
|
|
|||
Subordinated debt
|
5,200
|
|
|
8,009
|
|
|
(2,809
|
)
|
(35
|
)%
|
|
|||
Other
|
4,789
|
|
|
4,176
|
|
|
613
|
|
15
|
%
|
|
|||
Total borrowed
funds
|
59,088
|
|
|
52,706
|
|
|
6,382
|
|
12
|
%
|
|
|||
Total funding sources
|
$
|
324,141
|
|
|
$
|
309,870
|
|
|
$
|
14,271
|
|
5
|
%
|
|
•
|
Retail Banking
|
•
|
Corporate & Institutional Banking
|
•
|
Asset Management Group
|
•
|
BlackRock
|
•
|
The Residential Mortgage Banking segment was combined into Retail Banking as a result of our strategic initiative to transform the home lending process by integrating mortgage and home equity lending to enhance product capability and speed of delivery for a better customer experience and to improve efficiency. In conjunction with this shift, residential mortgages previously reported within the “Other” category were also moved to Retail Banking.
|
•
|
The Non-Strategic Assets Portfolio segment was eliminated. The segment’s remaining consumer assets were moved to the “Other” category as they are unrelated to the ongoing strategy of any segment, while its commercial assets were transferred to Corporate & Institutional Banking in order to continue the relationships we have with those customers.
|
•
|
A portion of business banking clients was moved from Retail Banking to Corporate & Institutional Banking to facilitate enhanced product offerings to meet the financial needs of our business banking clients.
|
Year ended December 31
|
|
|
|
|
Change
|
|
|||||||||
Dollars in millions, except as noted
|
2017
|
|
2016
|
|
$
|
|
%
|
|
|||||||
Net interest income
|
$
|
4,626
|
|
|
$
|
4,511
|
|
|
$
|
115
|
|
|
3
|
%
|
|
Noninterest income
|
2,236
|
|
|
2,693
|
|
|
(457
|
)
|
|
(17
|
)%
|
|
|||
Total revenue
|
6,862
|
|
|
7,204
|
|
|
(342
|
)
|
|
(5
|
)%
|
|
|||
Provision for credit losses
|
347
|
|
|
297
|
|
|
50
|
|
|
17
|
%
|
|
|||
Noninterest expense
|
5,451
|
|
|
5,291
|
|
|
160
|
|
|
3
|
%
|
|
|||
Pretax earnings
|
1,064
|
|
|
1,616
|
|
|
(552
|
)
|
|
(34
|
)%
|
|
|||
Income taxes
|
534
|
|
|
593
|
|
|
(59
|
)
|
|
(10
|
)%
|
|
|||
Earnings
|
$
|
530
|
|
|
$
|
1,023
|
|
|
$
|
(493
|
)
|
|
(48
|
)%
|
|
AVERAGE BALANCE SHEET
|
|
|
|
|
|
|
|
|
|||||||
Loans held for sale
|
$
|
799
|
|
|
$
|
942
|
|
|
$
|
(143
|
)
|
|
(15
|
)%
|
|
Loans
|
|
|
|
|
|
|
|
|
|||||||
Consumer
|
|
|
|
|
|
|
|
|
|||||||
Home equity
|
$
|
25,278
|
|
|
$
|
26,204
|
|
|
$
|
(926
|
)
|
|
(4
|
)%
|
|
Automobile
|
12,407
|
|
|
11,248
|
|
|
1,159
|
|
|
10
|
%
|
|
|||
Education
|
4,832
|
|
|
5,562
|
|
|
(730
|
)
|
|
(13
|
)%
|
|
|||
Credit cards
|
5,248
|
|
|
4,889
|
|
|
359
|
|
|
7
|
%
|
|
|||
Other
|
1,773
|
|
|
1,789
|
|
|
(16
|
)
|
|
(1
|
)%
|
|
|||
Total consumer
|
49,538
|
|
|
49,692
|
|
|
(154
|
)
|
|
—
|
|
|
|||
Commercial and commercial real estate
|
10,767
|
|
|
11,410
|
|
|
(643
|
)
|
|
(6
|
)%
|
|
|||
Residential mortgage
|
12,238
|
|
|
10,682
|
|
|
1,556
|
|
|
15
|
%
|
|
|||
Total loans
|
$
|
72,543
|
|
|
$
|
71,784
|
|
|
$
|
759
|
|
|
1
|
%
|
|
Total assets
|
$
|
88,663
|
|
|
$
|
85,871
|
|
|
$
|
2,792
|
|
|
3
|
%
|
|
Deposits
|
|
|
|
|
|
|
|
|
|||||||
Noninterest-bearing demand
|
$
|
29,788
|
|
|
$
|
28,364
|
|
|
$
|
1,424
|
|
|
5
|
%
|
|
Interest-bearing demand
|
40,958
|
|
|
38,584
|
|
|
2,374
|
|
|
6
|
%
|
|
|||
Money market
|
36,592
|
|
|
44,855
|
|
|
(8,263
|
)
|
|
(18
|
)%
|
|
|||
Savings
|
38,802
|
|
|
27,340
|
|
|
11,462
|
|
|
42
|
%
|
|
|||
Certificates of deposit
|
13,135
|
|
|
14,770
|
|
|
(1,635
|
)
|
|
(11
|
)%
|
|
|||
Total deposits
|
$
|
159,275
|
|
|
$
|
153,913
|
|
|
$
|
5,362
|
|
|
3
|
%
|
|
PERFORMANCE RATIOS
|
|
|
|
|
|
|
|
|
|||||||
Return on average assets
|
.60
|
%
|
|
1.19
|
%
|
|
|
|
|
|
|||||
Noninterest income to total revenue
|
33
|
%
|
|
37
|
%
|
|
|
|
|
|
|||||
Efficiency
|
79
|
%
|
|
73
|
%
|
|
|
|
|
|
Year ended December 31
|
|
|
|
|
Change
|
|
|||||||||
Dollars in millions, except as noted
|
2017
|
|
2016
|
|
$
|
|
%
|
|
|||||||
SUPPLEMENTAL NONINTEREST INCOME INFORMATION
|
|
|
|
|
|
|
|
|
|||||||
Consumer services
|
$
|
1,079
|
|
|
$
|
1,061
|
|
|
$
|
18
|
|
|
2
|
%
|
|
Brokerage
|
$
|
312
|
|
|
$
|
295
|
|
|
$
|
17
|
|
|
6
|
%
|
|
Residential mortgage
|
$
|
350
|
|
|
$
|
567
|
|
|
$
|
(217
|
)
|
|
(38
|
)%
|
|
Service charges on deposits
|
$
|
668
|
|
|
$
|
639
|
|
|
$
|
29
|
|
|
5
|
%
|
|
Residential Mortgage Information
|
|
|
|
|
|
|
|
|
|||||||
Residential mortgage servicing statistics (in billions, except as noted) (a)
|
|
|
|
|
|
|
|
|
|||||||
Serviced portfolio balance (b)
|
$
|
127
|
|
|
$
|
125
|
|
|
$
|
2
|
|
|
2
|
%
|
|
Serviced portfolio acquisitions
|
$
|
19
|
|
|
$
|
19
|
|
|
—
|
|
|
—
|
|
|
|
MSR asset value (b)
|
$
|
1.2
|
|
|
$
|
1.2
|
|
|
—
|
|
|
—
|
|
|
|
MSR capitalization value (in basis points) (b)
|
92
|
|
|
94
|
|
|
(2
|
)
|
|
(2
|
)%
|
|
|||
Servicing income: (in millions)
|
|
|
|
|
|
|
|
|
|
|
|||||
Servicing fees, net (c)
|
$
|
187
|
|
|
$
|
192
|
|
|
$
|
(5
|
)
|
|
(3
|
)%
|
|
Mortgage servicing rights valuation, net of economic hedge
|
$
|
(30
|
)
|
|
$
|
92
|
|
|
$
|
(122
|
)
|
|
*
|
|
|
Residential mortgage loan statistics
|
|
|
|
|
|
|
|
|
|||||||
Loan origination volume (in billions)
|
$
|
9.0
|
|
|
$
|
10.6
|
|
|
$
|
(1.6
|
)
|
|
(15
|
)%
|
|
Loan sale margin percentage
|
2.80
|
%
|
|
3.17
|
%
|
|
|
|
|
|
|||||
Percentage of originations represented by:
|
|
|
|
|
|
|
|
|
|||||||
Purchase volume (d)
|
53
|
%
|
|
40
|
%
|
|
|
|
|
|
|||||
Refinance volume
|
47
|
%
|
|
60
|
%
|
|
|
|
|
|
|
||||
OTHER INFORMATION (b)
|
|
|
|
|
|
|
|
|
|||||||
Customer-related statistics (average)
|
|
|
|
|
|
|
|
|
|||||||
Non-teller deposit transactions (e)
|
53
|
%
|
|
49
|
%
|
|
|
|
|
|
|||||
Digital consumer customers (f)
|
62
|
%
|
|
58
|
%
|
|
|
|
|
|
|||||
Credit-related statistics
|
|
|
|
|
|
|
|
|
|||||||
Nonperforming assets (g)
|
$
|
1,129
|
|
|
$
|
1,257
|
|
|
$
|
(128
|
)
|
|
(10
|
)%
|
|
Net charge-offs
|
$
|
371
|
|
|
$
|
351
|
|
|
$
|
20
|
|
|
6
|
%
|
|
Other statistics
|
|
|
|
|
|
|
|
|
|
|
|||||
ATMs
|
9,051
|
|
|
9,024
|
|
|
27
|
|
|
—
|
|
|
|||
Branches (h)
|
2,459
|
|
|
2,520
|
|
|
(61
|
)
|
|
(2
|
)%
|
|
|||
Brokerage account client assets (in billions) (i)
|
$
|
49
|
|
|
$
|
44
|
|
|
$
|
5
|
|
|
11
|
%
|
|
(a)
|
Represents mortgage loan servicing balances for third parties and the related income.
|
(b)
|
Presented as of December 31, except for customer-related statistics, which are averages for the year ended, and net charge-offs, which are for the year ended.
|
(c)
|
Servicing fees net of impact of decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan prepayments and loans that were paid down or paid off during the period.
|
(d)
|
Mortgages with borrowers as part of residential real estate purchase transactions.
|
(e)
|
Percentage of total consumer and business banking deposit transactions processed at an ATM or through our mobile banking application.
|
(f)
|
Represents consumer checking relationships that process the majority of their transactions through non-teller channels.
|
(g)
|
Includes nonperforming loans of $1.1 billion and $1.2 billion at
December 31, 2017
and
December 31, 2016
, respectively.
|
(h)
|
Excludes stand-alone mortgage offices and satellite offices (e.g., drive-ups, electronic branches and retirement centers) that provide limited products and/or services.
|
(i)
|
Includes cash and money market balances.
|
•
|
Average residential mortgages increased as a result of growth in originations of nonconforming residential mortgage loans, both nationwide and within our branch network.
|
•
|
Average automobile loans increased primarily due to portfolio growth, including growth in our Southeast markets.
|
•
|
Average credit card balances increased as a result of organic growth as we continued to focus on delivering on our long-term objective of deepening penetration within our existing customer base.
|
•
|
Average home equity loans decreased as paydowns and payoffs on loans exceeded new originated volume. The weighted-average updated FICO scores for this portfolio were 749 at December 31, 2017 and 746 at December 31, 2016.
|
•
|
Average commercial and commercial real estate loans declined as paydowns and payoffs on loans exceeded new volume.
|
•
|
In 2017, average loan balances for the education and other loan portfolios decreased $746 million, or 10%, compared to 2016, driven by declines in the government guaranteed education and indirect other portfolios, which are primarily runoff portfolios.
|
•
|
In 2017, approximately 62% of consumer customers used non-teller channels for the majority of their transactions compared with 58% for 2016.
|
•
|
Deposit transactions via ATM and mobile channels increased to 53% of total deposit transactions in 2017 compared with 49% for 2016.
|
•
|
We had a network of 2,459 branches and 9,051 ATMs at December 31, 2017.
|
•
|
Instant debit card issuance, which enables us to print a customer’s debit card in minutes, was available in 90% of the branch network as of December 31, 2017.
|
•
|
We implemented a new mortgage origination system in the fourth quarter of 2017.
|
•
|
Loans continue to be originated primarily through direct channels under Federal National Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC) and Federal Housing Administration (FHA)/Department of Veterans Affairs agency guidelines.
|
Year ended December 31
|
|
|
|
|
Change
|
|
|||||||||
Dollars in millions, except as noted
|
2017
|
|
2016
|
|
$
|
|
%
|
|
|||||||
INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|||||||
Net interest income
|
$
|
3,551
|
|
|
$
|
3,312
|
|
|
$
|
239
|
|
|
7
|
%
|
|
Noninterest income
|
2,271
|
|
|
2,035
|
|
|
236
|
|
|
12
|
%
|
|
|||
Total revenue
|
5,822
|
|
|
5,347
|
|
|
475
|
|
|
9
|
%
|
|
|||
Provision for credit losses
|
160
|
|
|
177
|
|
|
(17
|
)
|
|
(10
|
)%
|
|
|||
Noninterest expense
|
2,428
|
|
|
2,222
|
|
|
206
|
|
|
9
|
%
|
|
|||
Pretax earnings
|
3,234
|
|
|
2,948
|
|
|
286
|
|
|
10
|
%
|
|
|||
Income taxes
|
770
|
|
|
1,039
|
|
|
(269
|
)
|
|
(26
|
)%
|
|
|||
Earnings
|
$
|
2,464
|
|
|
$
|
1,909
|
|
|
$
|
555
|
|
|
29
|
%
|
|
AVERAGE BALANCE SHEET
|
|
|
|
|
|
|
|
|
|||||||
Loans held for sale
|
$
|
898
|
|
|
$
|
868
|
|
|
$
|
30
|
|
|
3
|
%
|
|
Loans
|
|
|
|
|
|
|
|
|
|||||||
Commercial
|
$
|
96,937
|
|
|
$
|
88,934
|
|
|
$
|
8,003
|
|
|
9
|
%
|
|
Commercial real estate
|
27,372
|
|
|
26,677
|
|
|
695
|
|
|
3
|
%
|
|
|||
Equipment lease financing
|
7,619
|
|
|
7,463
|
|
|
156
|
|
|
2
|
%
|
|
|||
Total commercial lending
|
131,928
|
|
|
123,074
|
|
|
8,854
|
|
|
7
|
%
|
|
|||
Consumer
|
233
|
|
|
424
|
|
|
(191
|
)
|
|
(45
|
)%
|
|
|||
Total loans
|
$
|
132,161
|
|
|
$
|
123,498
|
|
|
$
|
8,663
|
|
|
7
|
%
|
|
Total assets
|
$
|
148,414
|
|
|
$
|
140,309
|
|
|
$
|
8,105
|
|
|
6
|
%
|
|
Deposits
|
|
|
|
|
|
|
|
|
|||||||
Noninterest-bearing demand
|
$
|
47,264
|
|
|
$
|
48,072
|
|
|
$
|
(808
|
)
|
|
(2
|
)%
|
|
Money market
|
22,464
|
|
|
22,543
|
|
|
(79
|
)
|
|
—
|
|
|
|||
Other
|
16,389
|
|
|
13,943
|
|
|
2,446
|
|
|
18
|
%
|
|
|||
Total deposits
|
$
|
86,117
|
|
|
$
|
84,558
|
|
|
$
|
1,559
|
|
|
2
|
%
|
|
PERFORMANCE RATIOS
|
|
|
|
|
|
|
|
|
|||||||
Return on average assets
|
1.66
|
%
|
|
1.36
|
%
|
|
|
|
|
|
|||||
Noninterest income to total revenue
|
39
|
%
|
|
38
|
%
|
|
|
|
|
|
|||||
Efficiency
|
42
|
%
|
|
42
|
%
|
|
|
|
|
|
|
||||
OTHER INFORMATION
|
|
|
|
|
|
|
|
|
|||||||
Consolidated revenue from: (a)
|
|
|
|
|
|
|
|
|
|||||||
Treasury Management (b)
|
$
|
1,516
|
|
|
$
|
1,348
|
|
|
$
|
168
|
|
|
12
|
%
|
|
Capital Markets (b)
|
$
|
1,017
|
|
|
$
|
808
|
|
|
$
|
209
|
|
|
26
|
%
|
|
Commercial mortgage banking activities
|
|
|
|
|
|
|
|
|
|||||||
Commercial mortgage loans held for sale (c)
|
$
|
115
|
|
|
$
|
127
|
|
|
$
|
(12
|
)
|
|
(9
|
)%
|
|
Commercial mortgage loan servicing income (d)
|
228
|
|
|
248
|
|
|
(20
|
)
|
|
(8
|
)%
|
|
|||
Commercial mortgage servicing rights valuation, net of economic hedge (e)
|
54
|
|
|
44
|
|
|
10
|
|
|
23
|
%
|
|
|||
Total
|
$
|
397
|
|
|
$
|
419
|
|
|
$
|
(22
|
)
|
|
(5
|
)%
|
|
MSR asset value (f)
|
$
|
668
|
|
|
$
|
576
|
|
|
$
|
92
|
|
|
16
|
%
|
|
Average Loans by C&IB Business
|
|
|
|
|
|
|
|
|
|||||||
Corporate Banking
|
$
|
55,701
|
|
|
$
|
51,392
|
|
|
$
|
4,309
|
|
|
8
|
%
|
|
Real Estate
|
38,235
|
|
|
36,493
|
|
|
1,742
|
|
|
5
|
%
|
|
|||
Business Credit
|
15,804
|
|
|
14,763
|
|
|
1,041
|
|
|
7
|
%
|
|
|||
Equipment Finance
|
13,408
|
|
|
11,826
|
|
|
1,582
|
|
|
13
|
%
|
|
|||
Commercial
|
7,028
|
|
|
7,159
|
|
|
(131
|
)
|
|
(2
|
)%
|
|
|||
Other
|
1,985
|
|
|
1,865
|
|
|
120
|
|
|
6
|
%
|
|
|||
Total average loans
|
$
|
132,161
|
|
|
$
|
123,498
|
|
|
$
|
8,663
|
|
|
7
|
%
|
|
Credit-related statistics
|
|
|
|
|
|
|
|
|
|||||||
Nonperforming assets (f) (g)
|
$
|
531
|
|
|
$
|
691
|
|
|
$
|
(160
|
)
|
|
(23
|
)%
|
|
Net charge-offs
|
$
|
93
|
|
|
$
|
180
|
|
|
$
|
(87
|
)
|
|
(48
|
)%
|
|
(a)
|
Represents consolidated amounts. See the additional revenue discussion regarding treasury management, capital markets-related products and services, and commercial mortgage banking activities in the Product Revenue section of this Corporate & Institutional Banking section.
|
(b)
|
Includes amounts reported in net interest income and noninterest income, predominantly in corporate service fees.
|
(c)
|
Includes other noninterest income for valuations on commercial mortgage loans held for sale and related commitments, derivative valuations, originations fees, gains on sale of loans held for sale and net interest income on loans held for sale.
|
(d)
|
Includes net interest income and noninterest income (primarily in corporate service fees) from loan servicing net of reduction in commercial mortgage servicing rights due to time decay and payoffs. Commercial mortgage servicing rights valuation, net of economic hedge is shown separately.
|
(e)
|
Includes amounts reported in corporate service fees.
|
(f)
|
As of December 31.
|
(g)
|
Includes nonperforming loans of $.5 billion and $.6 billion at
December 31, 2017
and
December 31, 2016
, respectively.
|
•
|
Corporate Banking provides lending, treasury management and capital markets-related products and services to midsized and large corporations, government and not-for-profit entities. Average loans for this business grew in the comparison reflecting increased lending to large and midsized corporate clients as well as strong production in specialty lending verticals.
|
•
|
PNC Real Estate provides banking, financing and servicing solutions for commercial real estate clients across the country. Higher average loans for this business were primarily due to growth in commercial mortgage and commercial loans, and to a lesser extent project loans.
|
•
|
PNC Business Credit provides asset-based lending. The loan portfolio is relatively high yielding, with acceptable risk as the loans are mainly secured by short-term assets. Average loans for this business increased due to new originations and increased utilization, partially offset by payoffs.
|
•
|
PNC Equipment Finance provides equipment financing solutions for clients throughout the U.S. and Canada. Average loans, including commercial loans and finance leases, and operating leases totaled $14.3 billion in 2017, an increase of $1.8 billion compared with 2016 due to new production and the business acquired in the second quarter of 2017.
|
•
|
Commercial Banking provides lending, treasury management and capital markets-related products and services to smaller corporations and businesses. Average loans for this business decreased slightly primarily due to strategic risk/return considerations.
|
Year ended December 31
|
|
|
|
|
Change
|
|
|||||||||
Dollars in millions, except as noted
|
2017
|
|
2016
|
|
$
|
|
%
|
|
|||||||
INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|||||||
Net interest income
|
$
|
287
|
|
|
$
|
300
|
|
|
$
|
(13
|
)
|
|
(4
|
)%
|
|
Noninterest income
|
881
|
|
|
851
|
|
|
30
|
|
|
4
|
%
|
|
|||
Total revenue
|
1,168
|
|
|
1,151
|
|
|
17
|
|
|
1
|
%
|
|
|||
Provision for credit losses (benefit)
|
1
|
|
|
(6
|
)
|
|
7
|
|
|
*
|
|
|
|||
Noninterest expense
|
863
|
|
|
825
|
|
|
38
|
|
|
5
|
%
|
|
|||
Pretax earnings
|
304
|
|
|
332
|
|
|
(28
|
)
|
|
(8
|
)%
|
|
|||
Income taxes
|
102
|
|
|
122
|
|
|
(20
|
)
|
|
(16
|
)%
|
|
|||
Earnings
|
$
|
202
|
|
|
$
|
210
|
|
|
$
|
(8
|
)
|
|
(4
|
)%
|
|
AVERAGE BALANCE SHEET
|
|
|
|
|
|
|
|
|
|||||||
Loans
|
|
|
|
|
|
|
|
|
|||||||
Consumer
|
$
|
5,018
|
|
|
$
|
5,436
|
|
|
$
|
(418
|
)
|
|
(8
|
)%
|
|
Commercial and commercial real estate
|
715
|
|
|
754
|
|
|
(39
|
)
|
|
(5
|
)%
|
|
|||
Residential mortgage
|
1,301
|
|
|
1,058
|
|
|
243
|
|
|
23
|
%
|
|
|||
Total loans
|
$
|
7,034
|
|
|
$
|
7,248
|
|
|
$
|
(214
|
)
|
|
(3
|
)%
|
|
Total assets
|
$
|
7,511
|
|
|
$
|
7,707
|
|
|
$
|
(196
|
)
|
|
(3
|
)%
|
|
Deposits
|
|
|
|
|
|
|
|
|
|
|
|||||
Noninterest-bearing demand
|
$
|
1,528
|
|
|
$
|
1,431
|
|
|
$
|
97
|
|
|
7
|
%
|
|
Interest-bearing demand
|
3,628
|
|
|
4,013
|
|
|
(385
|
)
|
|
(10
|
)%
|
|
|||
Money market
|
3,158
|
|
|
4,128
|
|
|
(970
|
)
|
|
(23
|
)%
|
|
|||
Savings
|
3,947
|
|
|
2,303
|
|
|
1,644
|
|
|
71
|
%
|
|
|||
Other
|
250
|
|
|
275
|
|
|
(25
|
)
|
|
(9
|
)%
|
|
|||
Total deposits
|
$
|
12,511
|
|
|
$
|
12,150
|
|
|
$
|
361
|
|
|
3
|
%
|
|
PERFORMANCE RATIOS
|
|
|
|
|
|
|
|
|
|||||||
Return on average assets
|
2.69
|
%
|
|
2.72
|
%
|
|
|
|
|
|
|||||
Noninterest income to total revenue
|
75
|
%
|
|
74
|
%
|
|
|
|
|
|
|||||
Efficiency
|
74
|
%
|
|
72
|
%
|
|
|
|
|
|
|
||||
OTHER INFORMATION
|
|
|
|
|
|
|
|
|
|||||||
Nonperforming assets (a) (b)
|
$
|
49
|
|
|
$
|
53
|
|
|
$
|
(4
|
)
|
|
(8
|
)%
|
|
Net charge-offs
|
$
|
4
|
|
|
$
|
9
|
|
|
$
|
(5
|
)
|
|
(56
|
)%
|
|
CLIENT ASSETS UNDER ADMINISTRATION
(in billions) (a) (c) (d)
|
|
|
|
|
|
|
|
|
|||||||
Discretionary client assets under management
|
$
|
151
|
|
|
$
|
137
|
|
|
$
|
14
|
|
|
10
|
%
|
|
Nondiscretionary client assets under administration
|
131
|
|
|
120
|
|
|
11
|
|
|
9
|
%
|
|
|||
Total
|
$
|
282
|
|
|
$
|
257
|
|
|
$
|
25
|
|
|
10
|
%
|
|
Discretionary client assets under management
|
|
|
|
|
|
|
|
|
|||||||
Personal
|
$
|
94
|
|
|
$
|
85
|
|
|
$
|
9
|
|
|
11
|
%
|
|
Institutional
|
57
|
|
|
52
|
|
|
5
|
|
|
10
|
%
|
|
|||
Total
|
$
|
151
|
|
|
$
|
137
|
|
|
$
|
14
|
|
|
10
|
%
|
|
(a)
|
As of December 31.
|
(b)
|
Includes nonperforming loans of $44 million at
December 31, 2017
and $46 million at
December 31, 2016
.
|
(c)
|
Excludes brokerage account client assets.
|
(d)
|
Effective for the first quarter of 2017, we have adjusted nondiscretionary client assets under administration for prior periods to remove assets which, as a result of certain investment advisory services performed by one of our registered investment advisors, were previously reported as both discretionary client assets under management and nondiscretionary client assets under administration. Effective for the first quarter of 2017, these amounts are only reported as discretionary assets under management. The prior period presented was adjusted to remove approximately $9 billion as of
December 31, 2016
previously included in nondiscretionary assets under administration.
|
Year ended December 31
|
|
|
|
|
||||
Dollars in millions
|
2017
|
|
|
2016
|
|
|
||
Business segment earnings (a)
|
$
|
1,764
|
|
|
$
|
532
|
|
|
PNC’s economic interest in BlackRock (b)
|
22
|
%
|
|
22
|
%
|
|
(a)
|
Includes our share of BlackRock’s reported GAAP earnings and income taxes on those earnings incurred by us.
|
(b)
|
At
December 31
.
|
In billions
|
December 31, 2017
|
|
|
December 31, 2016
|
|
|
||
Carrying value of our investment in
BlackRock (c)
|
$
|
7.7
|
|
|
$
|
7.0
|
|
|
Market value of our investment in
BlackRock (d)
|
$
|
17.9
|
|
|
$
|
13.4
|
|
|
(c)
|
We account for our investment in BlackRock under the equity method of accounting, exclusive of a related deferred tax liability of $
1.6 billion
at
December 31, 2017
and $
2.3 billion
at
December 31, 2016
. Our voting interest in BlackRock common stock was approximately 21% at
December 31, 2017
.
|
(d)
|
Does not include liquidity discount.
|
•
|
Audit Committee
: monitors the integrity of our consolidated financial statements; monitors internal control over financial reporting; monitors compliance with our code of ethics; evaluates and monitors the qualifications and independence of our independent auditors; and evaluates and monitors the performance of our Internal Audit function and our independent auditors.
|
•
|
Nominating and Governance Committee
: oversees the implementation of sound corporate governance principles and practices while promoting our best interests and those of our shareholders
|
•
|
Personnel and Compensation Committee
: oversees the compensation of our executive officers and other specified responsibilities related to personnel compensation matters affecting us.
|
•
|
Risk Committee
: oversees enterprise-wide risk structure and the processes established to identify, measure, monitor and manage the organization’s risks and evaluates and approves our risk governance framework. The Risk Committee has formed a Technology Subcommittee and a Compliance Subcommittee to facilitate Board-level oversight of risk management in these areas.
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
||||||||||
Dollars in millions
|
Amount
|
|
% of Total
|
|
|
Amount
|
|
% of Total
|
|
||||||
Commercial
|
|
|
|
|
|
|
|
|
|
||||||
Manufacturing
|
$
|
20,578
|
|
|
19
|
%
|
|
|
$
|
18,891
|
|
|
19
|
%
|
|
Retail/wholesale trade
|
17,846
|
|
|
16
|
%
|
|
|
16,752
|
|
|
17
|
%
|
|
||
Service providers
|
15,100
|
|
|
14
|
%
|
|
|
14,707
|
|
|
15
|
%
|
|
||
Real estate related (a)
|
12,496
|
|
|
11
|
%
|
|
|
11,920
|
|
|
12
|
%
|
|
||
Health care
|
9,739
|
|
|
9
|
%
|
|
|
9,491
|
|
|
9
|
%
|
|
||
Financial services
|
8,532
|
|
|
8
|
%
|
|
|
7,241
|
|
|
7
|
%
|
|
||
Transportation and
warehousing
|
5,609
|
|
|
5
|
%
|
|
|
5,170
|
|
|
5
|
%
|
|
||
Other industries
|
20,627
|
|
|
18
|
%
|
|
|
17,192
|
|
|
16
|
%
|
|
||
Total commercial loans
|
$
|
110,527
|
|
|
100
|
%
|
|
|
$
|
101,364
|
|
|
100
|
%
|
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
||||||||||
Dollars in millions
|
Amount
|
|
% of Total
|
|
|
Amount
|
|
% of Total
|
|
||||||
Geography
|
|
|
|
|
|
|
|
|
|
||||||
California
|
$
|
4,192
|
|
|
14
|
%
|
|
|
$
|
4,045
|
|
|
14
|
%
|
|
Florida
|
2,221
|
|
|
8
|
%
|
|
|
2,263
|
|
|
8
|
%
|
|
||
Maryland
|
2,104
|
|
|
7
|
%
|
|
|
2,189
|
|
|
7
|
%
|
|
||
Texas
|
1,639
|
|
|
6
|
%
|
|
|
1,531
|
|
|
5
|
%
|
|
||
Virginia
|
1,609
|
|
|
5
|
%
|
|
|
1,666
|
|
|
6
|
%
|
|
||
Pennsylvania
|
1,394
|
|
|
5
|
%
|
|
|
1,424
|
|
|
5
|
%
|
|
||
Illinois
|
1,325
|
|
|
5
|
%
|
|
|
1,135
|
|
|
4
|
%
|
|
||
New York
|
1,163
|
|
|
4
|
%
|
|
|
1,384
|
|
|
5
|
%
|
|
||
Ohio
|
1,134
|
|
|
4
|
%
|
|
|
1,128
|
|
|
4
|
%
|
|
||
New Jersey
|
964
|
|
|
3
|
%
|
|
|
1,079
|
|
|
4
|
%
|
|
||
All other states
|
11,233
|
|
|
39
|
%
|
|
|
11,166
|
|
|
38
|
%
|
|
||
Total commercial real
estate loans
|
$
|
28,978
|
|
|
100
|
%
|
|
|
$
|
29,010
|
|
|
100
|
%
|
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
||||||||||
Dollars in millions
|
Amount
|
|
% of Total
|
|
|
Amount
|
|
% of Total
|
|
||||||
Geography
|
|
|
|
|
|
|
|
|
|
||||||
Pennsylvania
|
$
|
6,792
|
|
|
24
|
%
|
|
|
$
|
7,259
|
|
|
24
|
%
|
|
New Jersey
|
4,252
|
|
|
15
|
%
|
|
|
4,364
|
|
|
15
|
%
|
|
||
Ohio
|
3,413
|
|
|
12
|
%
|
|
|
3,616
|
|
|
12
|
%
|
|
||
Illinois
|
1,801
|
|
|
6
|
%
|
|
|
1,907
|
|
|
6
|
%
|
|
||
Maryland
|
1,572
|
|
|
6
|
%
|
|
|
1,629
|
|
|
6
|
%
|
|
||
Michigan
|
1,442
|
|
|
5
|
%
|
|
|
1,483
|
|
|
5
|
%
|
|
||
North Carolina
|
1,266
|
|
|
5
|
%
|
|
|
1,338
|
|
|
5
|
%
|
|
||
Florida
|
1,255
|
|
|
4
|
%
|
|
|
1,275
|
|
|
4
|
%
|
|
||
Kentucky
|
1,138
|
|
|
4
|
%
|
|
|
1,206
|
|
|
4
|
%
|
|
||
Indiana
|
924
|
|
|
3
|
%
|
|
|
1,000
|
|
|
3
|
%
|
|
||
All other states
|
4,509
|
|
|
16
|
%
|
|
|
4,872
|
|
|
16
|
%
|
|
||
Total home equity
loans
|
$
|
28,364
|
|
|
100
|
%
|
|
|
$
|
29,949
|
|
|
100
|
%
|
|
Lien type
|
|
|
|
|
|
|
|
|
|
||||||
1st lien
|
|
|
58
|
%
|
|
|
|
|
55
|
%
|
|
||||
2nd lien
|
|
|
42
|
%
|
|
|
|
|
45
|
%
|
|
||||
Total home equity
loans
|
|
|
100
|
%
|
|
|
|
|
100
|
%
|
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
||||||||||
Dollars in millions
|
Amount
|
|
% of Total
|
|
|
Amount
|
|
% of Total
|
|
||||||
Geography
|
|
|
|
|
|
|
|
|
|
||||||
California
|
$
|
3,676
|
|
|
21
|
%
|
|
|
$
|
2,842
|
|
|
18
|
%
|
|
Florida
|
1,529
|
|
|
9
|
%
|
|
|
1,511
|
|
|
10
|
%
|
|
||
New Jersey
|
1,503
|
|
|
9
|
%
|
|
|
1,285
|
|
|
8
|
%
|
|
||
Illinois
|
1,230
|
|
|
7
|
%
|
|
|
1,263
|
|
|
8
|
%
|
|
||
Pennsylvania
|
962
|
|
|
5
|
%
|
|
|
843
|
|
|
5
|
%
|
|
||
Maryland
|
902
|
|
|
5
|
%
|
|
|
857
|
|
|
6
|
%
|
|
||
New York
|
847
|
|
|
5
|
%
|
|
|
722
|
|
|
5
|
%
|
|
||
Virginia
|
824
|
|
|
5
|
%
|
|
|
772
|
|
|
5
|
%
|
|
||
North Carolina
|
821
|
|
|
5
|
%
|
|
|
797
|
|
|
5
|
%
|
|
||
Ohio
|
684
|
|
|
4
|
%
|
|
|
649
|
|
|
4
|
%
|
|
||
All other states
|
4,234
|
|
|
25
|
%
|
|
|
4,057
|
|
|
26
|
%
|
|
||
Total residential real
estate loans
|
$
|
17,212
|
|
|
100
|
%
|
|
|
$
|
15,598
|
|
|
100
|
%
|
|
|
|
December 31 2017
|
|
|
December 31
2016 |
|
|
Change
|
|
||||||
Dollars in millions
|
|
$
|
|
|
%
|
|
|||||||||
Nonperforming loans
|
|
|
|
|
|
|
|
|
|
||||||
Commercial lending
|
|
$
|
554
|
|
|
$
|
655
|
|
|
$
|
(101
|
)
|
|
(15)%
|
|
Consumer lending (a)
|
|
1,311
|
|
|
1,489
|
|
|
(178
|
)
|
|
(12)%
|
|
|||
Total nonperforming
loans
|
|
1,865
|
|
|
2,144
|
|
|
(279
|
)
|
|
(13)%
|
|
|||
OREO, foreclosed and
other assets
|
|
170
|
|
|
230
|
|
|
(60
|
)
|
|
(26)%
|
|
|||
Total nonperforming
assets
|
|
$
|
2,035
|
|
|
$
|
2,374
|
|
|
$
|
(339
|
)
|
|
(14)%
|
|
Amount of TDRs
included in
nonperforming loans
|
|
$
|
964
|
|
|
$
|
1,112
|
|
|
$
|
(148
|
)
|
|
(13)%
|
|
Percentage of total
nonperforming loans
|
|
52
|
%
|
|
52
|
%
|
|
|
|
|
|
||||
Nonperforming loans
to total loans
|
|
.85
|
%
|
|
1.02
|
%
|
|
|
|
|
|
||||
Nonperforming assets
to total loans, OREO,
foreclosed and other
assets
|
|
.92
|
%
|
|
1.12
|
%
|
|
|
|
|
|
||||
Nonperforming assets
to total assets
|
|
.53
|
%
|
|
.65
|
%
|
|
|
|
|
|
||||
Allowance for loan and
lease losses to total
nonperforming loans
|
|
140
|
%
|
|
121
|
%
|
|
|
|
|
|
(a)
|
Excludes most consumer loans and lines of credit not secured by residential real estate, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.
|
In millions
|
|
2017
|
|
|
2016
|
|
|
||
January 1
|
|
$
|
2,374
|
|
|
$
|
2,425
|
|
|
New nonperforming assets
|
|
1,376
|
|
|
1,835
|
|
|
||
Charge-offs and valuation adjustments
|
|
(585
|
)
|
|
(604
|
)
|
|
||
Principal activity, including paydowns and
payoffs
|
|
(638
|
)
|
|
(697
|
)
|
|
||
Asset sales and transfers to loans held for sale
|
|
(178
|
)
|
|
(336
|
)
|
|
||
Returned to performing status
|
|
(314
|
)
|
|
(249
|
)
|
|
||
December 31
|
|
$
|
2,035
|
|
|
$
|
2,374
|
|
|
|
|
Amount
|
|
|
|
|
|
Percentage of Total Loans Outstanding
|
|
|||||||||||||
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
|
Change
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
|
|||||||
Dollars in millions
|
|
|
|
$
|
|
|
%
|
|
|
|
|
|||||||||||
Early stage loan delinquencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Accruing loans past due 30 to 59 days
|
|
$
|
545
|
|
|
$
|
562
|
|
|
$
|
(17
|
)
|
|
(3
|
)%
|
|
.25
|
%
|
|
.27
|
%
|
|
Accruing loans past due 60 to 89 days
|
|
238
|
|
|
232
|
|
|
6
|
|
|
3
|
%
|
|
.11
|
%
|
|
.11
|
%
|
|
|||
Total
|
|
783
|
|
|
794
|
|
|
(11
|
)
|
|
(1
|
)%
|
|
.36
|
%
|
|
.38
|
%
|
|
|||
Late stage loan delinquencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Accruing loans past due 90 days or more
|
|
737
|
|
|
782
|
|
|
(45
|
)
|
|
(6
|
)%
|
|
.33
|
%
|
|
.37
|
%
|
|
|||
Total
|
|
$
|
1,520
|
|
|
$
|
1,576
|
|
|
$
|
(56
|
)
|
|
(4
|
)%
|
|
.69
|
%
|
|
.75
|
%
|
|
(a)
|
Past due loan amounts include government insured or guaranteed loans of $.9 billion at both
December 31, 2017
and
December 31, 2016
.
|
|
|
December 31, 2017
|
|
December 31, 2016
|
|
||||||||||
Dollars in millions
|
|
Number of Accounts
|
|
|
Unpaid Principal Balance
|
|
|
Number of Accounts
|
|
|
Unpaid Principal Balance
|
|
|
||
Temporary
modifications
|
|
3,033
|
|
|
$
|
217
|
|
|
3,484
|
|
|
$
|
258
|
|
|
Permanent
modifications
|
|
23,270
|
|
|
2,581
|
|
|
23,904
|
|
|
2,693
|
|
|
||
Total consumer real
estate related loan
modifications
|
|
26,303
|
|
|
$
|
2,798
|
|
|
27,388
|
|
|
$
|
2,951
|
|
|
|
|
December 31 2017
|
|
|
December 31
2016 |
|
|
Change
|
|
||||||
In millions
|
|
$
|
|
|
%
|
|
|||||||||
Total commercial
lending
|
|
$
|
409
|
|
|
$
|
428
|
|
|
$
|
(19
|
)
|
|
(4)%
|
|
Total consumer
lending
|
|
1,652
|
|
|
1,793
|
|
|
(141
|
)
|
|
(8)%
|
|
|||
Total TDRs
|
|
$
|
2,061
|
|
|
$
|
2,221
|
|
|
$
|
(160
|
)
|
|
(7)%
|
|
Nonperforming
|
|
$
|
964
|
|
|
$
|
1,112
|
|
|
$
|
(148
|
)
|
|
(13)%
|
|
Accruing (b)
|
|
1,097
|
|
|
1,109
|
|
|
(12
|
)
|
|
(1)%
|
|
|||
Total TDRs
|
|
$
|
2,061
|
|
|
$
|
2,221
|
|
|
$
|
(160
|
)
|
|
(7)%
|
|
(a)
|
Amounts in table represent recorded investment, which includes the unpaid principal balance plus accrued interest and net accounting adjustments, less any charge-offs. Recorded investment does not include any associated valuation allowance.
|
(b)
|
Accruing loans include consumer credit card loans and loans that have demonstrated a period of at least six months of performance under the restructured terms and are excluded from nonperforming loans.
|
•
|
Industry concentrations and conditions,
|
•
|
Recent credit quality trends,
|
•
|
Recent loss experience in particular portfolios,
|
•
|
Recent macro-economic factors,
|
•
|
Model imprecision,
|
•
|
Changes in lending policies and procedures,
|
•
|
Timing of available information, including the performance of first lien positions, and
|
•
|
Limitations of available historical data.
|
Dollars in millions
|
|
2017
|
|
2016
|
|
||||
January 1
|
|
$
|
2,589
|
|
|
$
|
2,727
|
|
|
Total net charge-offs
|
|
(457
|
)
|
|
(543
|
)
|
|
||
Provision for credit losses
|
|
441
|
|
|
433
|
|
|
||
Net decrease / (increase) in allowance for
unfunded loan commitments and
letters of credit
|
|
4
|
|
|
(40
|
)
|
|
||
Other
|
|
34
|
|
|
12
|
|
|
||
December 31
|
|
$
|
2,611
|
|
|
$
|
2,589
|
|
|
Net charge-offs to average loans (for the
year ended)
|
|
.21
|
%
|
|
.26
|
%
|
|
||
Allowance for loan and lease losses to
total loans
|
|
1.18
|
%
|
|
1.23
|
%
|
|
||
Commercial lending net charge-offs
|
|
$
|
(105
|
)
|
|
$
|
(185
|
)
|
|
Consumer lending net charge-offs
|
|
(352
|
)
|
|
(358
|
)
|
|
||
Total net charge-offs
|
|
$
|
(457
|
)
|
|
$
|
(543
|
)
|
|
Net charge-offs to average loans (for the
year ended)
|
|
|
|
|
|
||||
Commercial lending
|
|
.07
|
%
|
|
.14
|
%
|
|
||
Consumer lending
|
|
.49
|
%
|
|
.50
|
%
|
|
Year ended December 31
Dollars in millions
|
|
Gross Charge-offs
|
|
|
Recoveries
|
|
|
Net
Charge-offs / (Recoveries)
|
|
|
Percent of Average Loans
|
|
|
|||
2017
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial
|
|
$
|
186
|
|
|
$
|
81
|
|
|
$
|
105
|
|
|
.10
|
%
|
|
Commercial real
estate
|
|
24
|
|
|
28
|
|
|
(4
|
)
|
|
(.01
|
)%
|
|
|||
Equipment
lease financing
|
|
11
|
|
|
7
|
|
|
4
|
|
|
.05
|
%
|
|
|||
Home equity
|
|
123
|
|
|
91
|
|
|
32
|
|
|
.11
|
%
|
|
|||
Residential real
estate
|
|
9
|
|
|
18
|
|
|
(9
|
)
|
|
(.06
|
)%
|
|
|||
Credit card
|
|
182
|
|
|
21
|
|
|
161
|
|
|
3.06
|
%
|
|
|||
Other consumer
|
|
251
|
|
|
83
|
|
|
168
|
|
|
.77
|
%
|
|
|||
Total
|
|
$
|
786
|
|
|
$
|
329
|
|
|
$
|
457
|
|
|
.21
|
%
|
|
2016
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial
|
|
$
|
332
|
|
|
$
|
117
|
|
|
$
|
215
|
|
|
.21
|
%
|
|
Commercial real
estate
|
|
26
|
|
|
51
|
|
|
(25
|
)
|
|
(.09
|
)%
|
|
|||
Equipment lease
financing
|
|
5
|
|
|
10
|
|
|
(5
|
)
|
|
(.07
|
)%
|
|
|||
Home equity
|
|
143
|
|
|
84
|
|
|
59
|
|
|
.19
|
%
|
|
|||
Residential real
estate
|
|
14
|
|
|
9
|
|
|
5
|
|
|
.03
|
%
|
|
|||
Credit card
|
|
161
|
|
|
19
|
|
|
142
|
|
|
2.90
|
%
|
|
|||
Other consumer
|
|
205
|
|
|
53
|
|
|
152
|
|
|
.70
|
%
|
|
|||
Total
|
|
$
|
886
|
|
|
$
|
343
|
|
|
$
|
543
|
|
|
.26
|
%
|
|
In billions
|
2017
|
|
|
|
January 1
|
$
|
31.0
|
|
|
Issuances
|
7.1
|
|
|
|
Calls and maturities
|
(4.6
|
)
|
|
|
Other
|
(.2
|
)
|
|
|
December 31
|
$
|
33.3
|
|
|
Issuance Date
|
Amount
|
Description of Issuance
|
October 23, 2017
|
$1 billion
|
Senior notes with a maturity date of October 25, 2027. Interest is payable semi-annually at a fixed rate of 3.100% on April 25 and October 25 of each year, beginning April 25, 2018.
|
October 23, 2017
|
$750 million
|
Senior notes with a maturity date of November 5, 2020. Interest is payable semi-annually at a fixed rate of 2.450% on May 5 and November 5 of each year, beginning November 5, 2017. Following the re-opening, the aggregate outstanding principal amount of this series of notes initially issued on November 3, 2015 increased to $1.5 billion.
|
•
|
Bank-level capital needs,
|
•
|
Laws and regulations,
|
•
|
Corporate policies,
|
•
|
Contractual restrictions, and
|
•
|
Other factors.
|
|
|
|
Payment Due By Period
|
|
||||||||||||||||
December 31, 2017 – in millions
|
Total
|
|
|
Less than
one year
|
|
|
One to
three years
|
|
|
Four to
five years
|
|
|
After five
years
|
|
|
|||||
Remaining contractual maturities of time deposits
|
$
|
17,261
|
|
|
$
|
12,138
|
|
|
$
|
1,976
|
|
|
$
|
1,868
|
|
|
$
|
1,279
|
|
|
Borrowed funds (a)
|
59,088
|
|
|
15,961
|
|
|
26,086
|
|
|
8,634
|
|
|
8,407
|
|
|
|||||
Minimum annual rentals on noncancellable leases
|
2,555
|
|
|
382
|
|
|
645
|
|
|
477
|
|
|
1,051
|
|
|
|||||
Nonqualified pension and postretirement benefits
|
474
|
|
|
54
|
|
|
102
|
|
|
97
|
|
|
221
|
|
|
|||||
Purchase obligations (b)
|
1,025
|
|
|
405
|
|
|
362
|
|
|
135
|
|
|
123
|
|
|
|||||
Total contractual cash obligations
|
$
|
80,403
|
|
|
$
|
28,940
|
|
|
$
|
29,171
|
|
|
$
|
11,211
|
|
|
$
|
11,081
|
|
|
(a)
|
Includes basis adjustment relating to accounting hedges and purchase accounting adjustments.
|
(b)
|
Includes purchase obligations for goods and services covered by noncancellable contracts and contracts including cancellation fees.
|
|
|
|
Amount Of Commitment Expiration By Period
|
|
||||||||||||||||
December 31, 2017 – in millions
|
Total Amounts Committed
|
|
|
Less than one
year
|
|
|
One to
three years
|
|
|
Four to
five years
|
|
|
After
five years
|
|
|
|||||
Commitments to extend credit (b)
|
$
|
159,641
|
|
|
$
|
59,713
|
|
|
$
|
57,573
|
|
|
$
|
41,532
|
|
|
$
|
823
|
|
|
Net outstanding standby letters of credit (c)
|
8,651
|
|
|
4,787
|
|
|
2,946
|
|
|
886
|
|
|
32
|
|
|
|||||
Reinsurance agreements (d)
|
1,654
|
|
|
7
|
|
|
16
|
|
|
11
|
|
|
1,620
|
|
|
|||||
Standby bond purchase agreements
|
843
|
|
|
301
|
|
|
542
|
|
|
|
|
|
|
|||||||
Other commitments (e)
|
1,732
|
|
|
1,333
|
|
|
305
|
|
|
60
|
|
|
34
|
|
|
|||||
Total commitments
|
$
|
172,521
|
|
|
$
|
66,141
|
|
|
$
|
61,382
|
|
|
$
|
42,489
|
|
|
$
|
2,509
|
|
|
(a)
|
Other commitments are funding commitments that could potentially require performance in the event of demands by third parties or contingent events. Loan commitments are reported net of syndications, assignments and participations.
|
(b)
|
Commitments to extend credit, or net unfunded loan commitments, represent arrangements to lend funds or provide liquidity subject to specified contractual conditions.
|
(c)
|
Includes
$3.5 billion
of standby letters of credit that support remarketing programs for customers’ variable rate demand notes.
|
(d)
|
Reinsurance agreements are with third-party insurers related to insurance sold to or placed on behalf of our customers. Balances represent estimates based on availability of financial information.
|
(e)
|
Includes other commitments of $.9 billion that were not on our Consolidated Balance Sheet. The remaining $.8 billion of other commitments were included in Other liabilities on our Consolidated Balance Sheet.
|
|
December 31, 2017
|
|
|||||||
Dollars in millions
|
2017 Transitional Basel III (a)
|
|
|
|
Pro forma Fully Phased-In Basel III (Non-GAAP) (estimated) (b)(c)
|
|
|
||
Common equity Tier 1 capital
|
|
|
|
|
|
||||
Common stock plus related surplus, net of treasury stock
|
$
|
8,195
|
|
|
|
$
|
8,195
|
|
|
Retained earnings
|
35,481
|
|
|
|
35,481
|
|
|
||
Accumulated other comprehensive income for securities currently and those transferred from available for sale
|
270
|
|
|
|
337
|
|
|
||
Accumulated other comprehensive income for pension and other postretirement plans
|
(436
|
)
|
|
|
(544
|
)
|
|
||
Goodwill, net of associated deferred tax liabilities
|
(8,988
|
)
|
|
|
(8,988
|
)
|
|
||
Other disallowed intangibles, net of deferred tax liabilities
|
(255
|
)
|
|
|
(319
|
)
|
|
||
Other adjustments/(deductions)
|
(138
|
)
|
|
|
(141
|
)
|
|
||
Total common equity Tier 1 capital before threshold deductions
|
34,129
|
|
|
|
34,021
|
|
|
||
Total threshold deductions (d)
|
(1,983
|
)
|
|
|
(2,928
|
)
|
|
||
Common equity Tier 1 capital
|
32,146
|
|
|
|
31,093
|
|
|
||
Additional Tier 1 capital
|
|
|
|
|
|
||||
Preferred stock plus related surplus
|
3,985
|
|
|
|
3,985
|
|
|
||
Other adjustments/(deductions)
|
(124
|
)
|
|
|
(146
|
)
|
|
||
Tier 1 capital
|
36,007
|
|
|
|
34,932
|
|
|
||
Additional Tier 2 capital
|
|
|
|
|
|
||||
Qualifying subordinated debt
|
3,482
|
|
|
|
3,433
|
|
|
||
Trust preferred capital securities
|
100
|
|
|
|
|
|
|||
Eligible credit reserves includable in Tier 2 capital
|
2,907
|
|
|
|
2,907
|
|
|
||
Total Basel III capital
|
$
|
42,496
|
|
|
|
$
|
41,272
|
|
|
Risk-weighted assets
|
|
|
|
|
|
||||
Basel III standardized approach risk-weighted assets (e)
|
$
|
309,460
|
|
|
|
$
|
316,120
|
|
|
Basel III advanced approaches risk-weighted assets (f)
|
N/A
|
|
|
|
$
|
285,226
|
|
|
|
Average quarterly adjusted total assets
|
$
|
364,999
|
|
|
|
$
|
363,967
|
|
|
Supplementary leverage exposure
(g)
|
$
|
435,731
|
|
|
|
$
|
434,698
|
|
|
Basel III risk-based capital and leverage ratios
|
|
|
|
|
|
||||
Common equity Tier 1
|
10.4
|
%
|
|
|
9.8
|
%
|
(h)(i)
|
||
Tier 1
|
11.6
|
%
|
|
|
11.1
|
%
|
(h)(j)
|
||
Total
|
13.7
|
%
|
|
|
13.1
|
%
|
(h)(k)
|
||
Leverage (l)
|
9.9
|
%
|
|
|
9.6
|
%
|
|
||
Supplementary leverage ratio (m)
|
8.3
|
%
|
|
|
8.0
|
%
|
|
(a)
|
Calculated using the regulatory capital methodology applicable to us during
2017
.
|
(b)
|
PNC utilizes the pro forma fully phased-in Basel III capital ratios to assess its capital position (without the benefit of phase-ins), as these ratios represent the regulatory capital standards that may ultimately be applicable to PNC under the final Basel III rules. Pro forma fully phased-in capital amounts, ratios and risk-weighted and leverage-related assets are estimates.
|
(c)
|
Basel III capital ratios and estimates may be impacted by additional regulatory guidance or analysis and, in the case of those ratios calculated using the advanced approaches, may be subject to variability based on the ongoing evolution, validation and regulatory approval of PNC’s models integral to the calculation of advanced approaches risk-weighted assets.
|
(d)
|
Under the Basel III rules, certain items such as significant common stock investments in unconsolidated financial institutions (primarily BlackRock), mortgage servicing rights and deferred tax assets must be deducted from capital (subject to a phase-in schedule and net of associated deferred tax liabilities) to the extent they individually exceed 10%, or in the aggregate exceed 15%, of PNC's adjusted common equity Tier 1 capital.
|
(e)
|
Includes credit and market risk-weighted assets.
|
(f)
|
Basel III advanced approaches risk-weighted assets are estimated based on the Basel III advanced approaches rules, and include credit, market, and operational risk-weighted assets. During the parallel run qualification phase, PNC has refined the data, models, and internal processes used as part of the advanced approaches for determining risk-weighted assets. We anticipate additional refinements to this estimate through the parallel run qualification phase.
|
(g)
|
Supplementary leverage exposure is the sum of Adjusted average assets and certain off-balance sheet exposures including undrawn credit commitments and derivative potential future exposures.
|
(h)
|
Pro forma fully phased-in Basel III capital ratio based on Basel III standardized approach risk-weighted assets and rules.
|
(i)
|
For comparative purposes only, the pro forma fully phased-in advanced approaches Basel III Common equity Tier 1 capital ratio estimate is 10.9%. This capital ratio is calculated using pro forma fully phased-in Common equity Tier 1 capital and dividing by estimated Basel III advanced approaches risk-weighted assets.
|
(j)
|
For comparative purposes only, the pro forma fully phased-in advanced approaches Basel III Tier 1 risk-based capital ratio estimate is 12.2%. This capital ratio is calculated using fully phased-in Tier 1 capital and dividing by estimated Basel III advanced approaches risk-weighted assets.
|
(k)
|
For comparative purposes only, the pro forma fully phased-in advanced approaches Basel III Total capital risk-based capital ratio estimate is 13.5%. This ratio is calculated using fully phased-in Total Basel III capital, which under the advanced approaches, Additional Tier 2 capital includes allowance for loan and lease losses in excess of Basel expected credit losses, if any, up to 0.6% of credit risk-weighted assets, and dividing by estimated Basel III advanced approaches risk-weighted assets.
|
(l)
|
Leverage ratio is calculated based on Tier 1 capital divided by Average quarterly adjusted total assets.
|
(m)
|
Supplementary leverage ratio is calculated based on Tier 1 capital divided by Supplementary leverage exposure. As advanced approaches banking organizations, PNC and PNC Bank are subject to a 3% minimum supplementary leverage ratio effective January 1, 2018.
|
•
|
Traditional banking activities of gathering deposits and extending loans,
|
•
|
Equity and other investments and activities whose economic values are directly impacted by market factors, and
|
•
|
Fixed income securities, derivatives and foreign exchange activities, as a result of customer activities and securities underwriting.
|
|
Fourth Quarter 2017
|
|
|
Fourth Quarter 2016
|
|
|
Net Interest Income Sensitivity Simulation (a)
|
|
|
|
|
||
Effect on net interest income in first
year from gradual interest rate
change over the following 12
months of:
|
|
|
|
|
||
100 basis point increase
|
2.7
|
%
|
|
2.6
|
%
|
|
100 basis point decrease
|
(3.2
|
)%
|
|
(4.2
|
)%
|
|
Effect on net interest income in
second year from gradual interest
rate change over the preceding 12
months of:
|
|
|
|
|
||
100 basis point increase
|
5.0
|
%
|
|
4.7
|
%
|
|
100 basis point decrease
|
(8.1
|
)%
|
|
(8.3
|
)%
|
|
Duration of Equity Model (a)
|
|
|
|
|
||
Base case duration of equity
(in years)
|
(1.7
|
)
|
|
(2.5
|
)
|
|
Key Period-End Interest Rates
|
|
|
|
|
||
One-month LIBOR
|
1.56
|
%
|
|
.77
|
%
|
|
Three-year swap
|
2.17
|
%
|
|
1.69
|
%
|
|
(a)
|
Given the inherent limitations in certain of these measurement
|
|
PNC
Economist
|
|
|
Market
Forward
|
|
|
Slope
Flattening
|
|
|
First year sensitivity
|
.7
|
%
|
|
.5
|
%
|
|
(.8
|
)%
|
|
Second year sensitivity
|
1.8
|
%
|
|
.4
|
%
|
|
(3.8
|
)%
|
|
In millions
|
December 31 2017
|
|
|
December 31 2016
|
|
|
Change
|
|
|||||||
|
$
|
|
%
|
|
|||||||||||
BlackRock
|
$
|
7,576
|
|
|
$
|
6,886
|
|
|
$
|
690
|
|
|
10
|
%
|
|
Tax credit
investments
|
2,148
|
|
|
2,090
|
|
|
58
|
|
|
3
|
%
|
|
|||
Private equity
and other
|
1,668
|
|
|
1,752
|
|
|
(84
|
)
|
|
(5
|
)%
|
|
|||
Total
|
$
|
11,392
|
|
|
$
|
10,728
|
|
|
$
|
664
|
|
|
6
|
%
|
|
•
|
Operations: Risk resulting from inadequate or failed internal processes, misconduct or errors of people or fraud.
|
•
|
Compliance: Risk of legal or regulatory sanctions, financial loss, or damage to reputation resulting from failure to comply with laws, regulations, rules, self-regulatory standards, or other regulatory requirements.
|
•
|
Data Management: Risk associated with incomplete or inaccurate data.
|
•
|
Model: Risk associated with the design, implementation, and ongoing use and management of a model.
|
•
|
Technology and Systems: Risk associated with the use, operation, and adoption of technology.
|
•
|
Information Security: Risk resulting from the failure to protect information and ensure appropriate access to, and use and handling of information assets.
|
•
|
Business Continuity: Risk of potential disruptive events to business activities.
|
•
|
Third Party: Risk arising from failure of third party providers to conduct activity in a safe and sound manner and in compliance with contract provisions and applicable laws and regulations.
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
||||||||||||
Dollars in millions
|
Total
Fair Value
|
|
|
Level 3
|
|
|
|
Total
Fair Value
|
|
|
Level 3
|
|
|
||||
Total assets
|
$
|
69,673
|
|
|
$
|
6,475
|
|
|
|
$
|
74,608
|
|
|
$
|
8,830
|
|
|
Total assets at fair value as a percentage of consolidated assets
|
18
|
%
|
|
|
|
|
20
|
%
|
|
|
|
||||||
Level 3 assets as a percentage of total assets at fair value
|
|
|
9
|
%
|
|
|
|
|
12
|
%
|
|
||||||
Level 3 assets as a percentage of consolidated assets
|
|
|
2
|
%
|
|
|
|
|
|
2
|
%
|
|
|||||
Total liabilities
|
$
|
4,233
|
|
|
$
|
531
|
|
|
|
$
|
4,818
|
|
|
$
|
433
|
|
|
Total liabilities at fair value as a percentage of consolidated liabilities
|
1
|
%
|
|
|
|
|
2
|
%
|
|
|
|
||||||
Level 3 liabilities as a percentage of total liabilities at fair value
|
|
|
13
|
%
|
|
|
|
|
9
|
%
|
|
||||||
Level 3 liabilities as a percentage of consolidated liabilities
|
|
|
<1%
|
|
|
|
|
|
|
<1
|
%
|
|
•
|
Probability of default (PD),
|
•
|
Loss given default (LGD),
|
•
|
Outstanding balance of the loan,
|
•
|
Movement through delinquency stages,
|
•
|
Amounts and timing of expected future cash flows,
|
•
|
Value of collateral, which may be obtained from third parties, and
|
•
|
Qualitative factors, such as changes in current economic conditions, that may not be reflected in modeled results.
|
•
|
Allowances For Loan And Lease Losses And Unfunded Loan Commitments And Letters Of Credit in the Credit Risk Management section of this Item 7, and
|
•
|
Note
1
Accounting Policies
and Note
4
Allowance for Loan and Lease Losses
in the Notes To Consolidated Financial Statements and Allocation of Allowance for Loan and Lease Losses in the Statistical Information (Unaudited) section of Item 8 of this Report.
|
•
|
Note
6
Fair Value
included in the Notes To Consolidated Financial Statements in Item 8 of this Report.
|
•
|
Note
7
Goodwill and Mortgage Servicing Rights
included in the Notes To Consolidated Financial Statements in Item 8 of this Report.
|
•
|
Commitments, including contractual obligations and other commitments, included within the Risk Management section of this Item 7, and
|
•
|
Note 2 Loan Sale and Servicing Activities and Variable Interest Entities,
|
•
|
Note 10 Borrowed Funds,
|
•
|
Note 15 Equity, and
|
•
|
Note 20 Commitments, all of which are in the Notes To Consolidated Financial Statements included in Item 8 of this Report.
|
•
|
Our businesses, financial results and balance sheet values are affected by business and economic conditions, including the following:
|
–
|
Changes in interest rates and valuations in debt, equity and other financial markets.
|
–
|
Disruptions in the U.S. and global financial markets.
|
–
|
Actions by the Federal Reserve Board, U.S. Treasury and other government agencies, including those that impact money supply and market interest rates.
|
–
|
Changes in customer behavior due to newly enacted tax legislation, changing business and economic conditions or legislative or regulatory initiatives.
|
–
|
Changes in customers’, suppliers’ and other counterparties’ performance and creditworthiness.
|
–
|
Slowing or reversal of the current U.S. economic expansion.
|
–
|
Commodity price volatility.
|
•
|
Our forward-looking financial statements are subject to the risk that 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. These statements are based on our current view that the U.S. economic growth will accelerate somewhat in 2018, in light of stimulus from recently passed corporate and personal income tax cuts that are expected to support business investment and consumer spending, respectively. Further gradual improvement in the labor market this year, including job gains and rising wages, is another positive for consumer spending. Other sources of growth for the U.S. economy in 2018 will be the global economic expansion and the housing market. Although inflation slowed in 2017, it should pick up as the labor market continues to tighten. Short-term interest rates and bond yields are expected to rise throughout 2018; our baseline forecast is for three increases in the federal funds rate in 2018, pushing the rate to a range of 2.00 to 2.25 percent by the end of the year. Longer-term rates are also expected to increase as the Federal Reserve slowly reduces the size of its balance sheet and the federal government borrows more, but at a slower pace than the short-term rates, so we anticipate the yield curve will flatten but not invert.
|
•
|
Our ability to take certain capital actions, including returning capital to shareholders, is subject to review by the Federal Reserve Board as part of our comprehensive capital plan for the applicable period in connection with the Federal Reserve Board’s Comprehensive Capital Analysis and Review (CCAR) process and to the acceptance of such capital plan and non-objection to such capital actions by the Federal Reserve Board.
|
•
|
Our regulatory capital ratios in the future will depend on, among other things, the company’s financial performance, the scope and terms of final capital regulations then in effect (particularly those implementing the international regulatory capital framework developed by the Basel Committee on Banking Supervision (Basel Committee), and management actions affecting the composition of our balance sheet. In addition, our 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 approval of related 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. Reputational impacts could affect matters such as business generation and retention,
|
–
|
Changes resulting from legislative and regulatory reforms, including changes affecting oversight of the financial services industry, consumer protection, pension, bankruptcy and other industry aspects, and changes in accounting policies and principles.
|
–
|
Changes to regulations governing bank capital and liquidity standards, including due to the Dodd-Frank Act and initiatives of the Basel Committee.
|
–
|
Unfavorable resolution of legal proceedings or other claims and regulatory and other governmental investigations or other inquiries. These matters may result in monetary judgments or settlements or other remedies, including fines, penalties, restitution or alterations in our business practices, and in additional expenses and collateral costs, and may cause reputational harm to us.
|
–
|
Results of the regulatory examination and supervision process, including our failure to satisfy requirements of agreements with governmental agencies.
|
–
|
Impact on business and operating results of any costs associated with obtaining rights in intellectual property claimed by others and of adequacy of our intellectual property protection in general.
|
•
|
Business and operating results are affected by our ability to identify and effectively manage risks inherent in our businesses, including, where appropriate, through effective use of systems and controls, third-party insurance, derivatives, and capital management techniques, and to meet evolving regulatory capital and liquidity standards.
|
•
|
Business and operating results also include impacts relating to our equity interest in BlackRock, Inc. and rely to a significant extent on information provided to us by BlackRock. Risks and uncertainties that could affect BlackRock are discussed in more detail by BlackRock in its SEC filings.
|
•
|
We grow our business in part through acquisitions. Acquisition risks and uncertainties include those presented by the nature of the business acquired, including in some cases those associated with our entry into new businesses or new geographic or other markets and risks resulting from our inexperience in those new areas, as well as risks and uncertainties related to the acquisition transactions themselves, regulatory issues, and the integration of the acquired businesses into PNC after closing.
|
•
|
Competition can have an impact on customer acquisition, growth and retention and on credit spreads and product pricing, which can affect market share, deposits and revenues. Our ability to anticipate and respond to technological changes can also impact our ability to respond to customer needs and meet competitive demands.
|
•
|
Business and operating results can also be affected by widespread natural and other disasters, pandemics, dislocations, terrorist activities, system failures, security breaches, cyberattacks or international hostilities through impacts on the economy and financial markets generally or on us or our counterparties specifically.
|
|
Year ended December 31
|
||||||||||
In millions, except per share data
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Interest Income
|
|
|
|
|
|
||||||
Loans
|
$
|
8,238
|
|
|
$
|
7,414
|
|
|
$
|
7,203
|
|
Investment securities
|
1,998
|
|
|
1,826
|
|
|
1,679
|
|
|||
Other
|
578
|
|
|
412
|
|
|
441
|
|
|||
Total interest income
|
10,814
|
|
|
9,652
|
|
|
9,323
|
|
|||
Interest Expense
|
|
|
|
|
|
||||||
Deposits
|
623
|
|
|
430
|
|
|
403
|
|
|||
Borrowed funds
|
1,083
|
|
|
831
|
|
|
642
|
|
|||
Total interest expense
|
1,706
|
|
|
1,261
|
|
|
1,045
|
|
|||
Net interest income
|
9,108
|
|
|
8,391
|
|
|
8,278
|
|
|||
Noninterest Income
|
|
|
|
|
|
||||||
Asset management
|
1,942
|
|
|
1,521
|
|
|
1,567
|
|
|||
Consumer services
|
1,415
|
|
|
1,388
|
|
|
1,335
|
|
|||
Corporate services
|
1,621
|
|
|
1,504
|
|
|
1,491
|
|
|||
Residential mortgage
|
350
|
|
|
567
|
|
|
566
|
|
|||
Service charges on deposits
|
695
|
|
|
667
|
|
|
651
|
|
|||
Other
|
1,198
|
|
|
1,124
|
|
|
1,337
|
|
|||
Total noninterest income
|
7,221
|
|
|
6,771
|
|
|
6,947
|
|
|||
Total revenue
|
16,329
|
|
|
15,162
|
|
|
15,225
|
|
|||
Provision For Credit Losses
|
441
|
|
|
433
|
|
|
255
|
|
|||
Noninterest Expense
|
|
|
|
|
|
||||||
Personnel
|
5,224
|
|
|
4,841
|
|
|
4,831
|
|
|||
Occupancy
|
868
|
|
|
861
|
|
|
842
|
|
|||
Equipment
|
1,065
|
|
|
974
|
|
|
925
|
|
|||
Marketing
|
244
|
|
|
247
|
|
|
249
|
|
|||
Other
|
2,997
|
|
|
2,553
|
|
|
2,616
|
|
|||
Total noninterest expense
|
10,398
|
|
|
9,476
|
|
|
9,463
|
|
|||
Income before income taxes and noncontrolling interests
|
5,490
|
|
|
5,253
|
|
|
5,507
|
|
|||
Income taxes
|
102
|
|
|
1,268
|
|
|
1,364
|
|
|||
Net income
|
5,388
|
|
|
3,985
|
|
|
4,143
|
|
|||
Less: Net income attributable to noncontrolling interests
|
50
|
|
|
82
|
|
|
37
|
|
|||
Preferred stock dividends
|
236
|
|
|
209
|
|
|
220
|
|
|||
Preferred stock discount accretion and redemptions
|
26
|
|
|
6
|
|
|
5
|
|
|||
Net income attributable to common shareholders
|
$
|
5,076
|
|
|
$
|
3,688
|
|
|
$
|
3,881
|
|
Earnings Per Common Share
|
|
|
|
|
|
||||||
Basic
|
$
|
10.49
|
|
|
$
|
7.42
|
|
|
$
|
7.52
|
|
Diluted
|
$
|
10.36
|
|
|
$
|
7.30
|
|
|
$
|
7.39
|
|
Average Common Shares Outstanding
|
|
|
|
|
|
||||||
Basic
|
481
|
|
|
494
|
|
|
514
|
|
|||
Diluted
|
486
|
|
|
500
|
|
|
521
|
|
|
Year ended December 31
|
||||||||||
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Net income
|
$
|
5,388
|
|
|
$
|
3,985
|
|
|
$
|
4,143
|
|
Other comprehensive income (loss), before tax and net of reclassifications into Net income:
|
|
|
|
|
|
||||||
Net unrealized gains (losses) on non-OTTI securities
|
16
|
|
|
(369
|
)
|
|
(569
|
)
|
|||
Net unrealized gains (losses) on OTTI securities
|
172
|
|
|
63
|
|
|
(13
|
)
|
|||
Net unrealized gains (losses) on cash flow hedge derivatives
|
(287
|
)
|
|
(153
|
)
|
|
127
|
|
|||
Pension and other postretirement benefit plan adjustments
|
169
|
|
|
1
|
|
|
(54
|
)
|
|||
Other
|
61
|
|
|
(59
|
)
|
|
(42
|
)
|
|||
Other comprehensive income (loss), before tax and net of reclassifications into Net income
|
131
|
|
|
(517
|
)
|
|
(551
|
)
|
|||
Income tax benefit (expense) related to items of other comprehensive income
|
(14
|
)
|
|
122
|
|
|
178
|
|
|||
Other comprehensive income (loss), after tax and net of reclassifications into Net income
|
117
|
|
|
(395
|
)
|
|
(373
|
)
|
|||
Comprehensive income
|
5,505
|
|
|
3,590
|
|
|
3,770
|
|
|||
Less: Comprehensive income attributable to noncontrolling interests
|
50
|
|
|
82
|
|
|
37
|
|
|||
Comprehensive income attributable to PNC
|
$
|
5,455
|
|
|
$
|
3,508
|
|
|
$
|
3,733
|
|
|
December 31
|
|
|
December 31
|
|
||
In millions, except par value
|
2017
|
|
|
2016
|
|
||
Assets
|
|
|
|
||||
Cash and due from banks
|
$
|
5,249
|
|
|
$
|
4,879
|
|
Interest-earning deposits with banks
|
28,595
|
|
|
25,711
|
|
||
Loans held for sale (a)
|
2,655
|
|
|
2,504
|
|
||
Investment securities – available for sale
|
57,618
|
|
|
60,104
|
|
||
Investment securities – held to maturity
|
18,513
|
|
|
15,843
|
|
||
Loans (a)
|
220,458
|
|
|
210,833
|
|
||
Allowance for loan and lease losses
|
(2,611
|
)
|
|
(2,589
|
)
|
||
Net loans
|
217,847
|
|
|
208,244
|
|
||
Equity investments
|
11,392
|
|
|
10,728
|
|
||
Mortgage servicing rights
|
1,832
|
|
|
1,758
|
|
||
Goodwill
|
9,173
|
|
|
9,103
|
|
||
Other (a)
|
27,894
|
|
|
27,506
|
|
||
Total assets
|
$
|
380,768
|
|
|
$
|
366,380
|
|
Liabilities
|
|
|
|
||||
Deposits
|
|
|
|
||||
Noninterest-bearing
|
$
|
79,864
|
|
|
$
|
80,230
|
|
Interest-bearing
|
185,189
|
|
|
176,934
|
|
||
Total deposits
|
265,053
|
|
|
257,164
|
|
||
Borrowed funds
|
|
|
|
||||
Federal Home Loan Bank borrowings
|
21,037
|
|
|
17,549
|
|
||
Bank notes and senior debt
|
28,062
|
|
|
22,972
|
|
||
Subordinated debt
|
5,200
|
|
|
8,009
|
|
||
Other (b)
|
4,789
|
|
|
4,176
|
|
||
Total borrowed funds
|
59,088
|
|
|
52,706
|
|
||
Allowance for unfunded loan commitments and letters of credit
|
297
|
|
|
301
|
|
||
Accrued expenses and other liabilities
|
8,745
|
|
|
9,355
|
|
||
Total liabilities
|
333,183
|
|
|
319,526
|
|
||
Equity
|
|
|
|
||||
Preferred stock (c)
|
|
|
|
||||
Common stock ($5 par value, Authorized 800 shares, issued 542 shares)
|
2,710
|
|
|
2,709
|
|
||
Capital surplus
|
16,374
|
|
|
16,651
|
|
||
Retained earnings
|
35,481
|
|
|
31,670
|
|
||
Accumulated other comprehensive income (loss)
|
(148
|
)
|
|
(265
|
)
|
||
Common stock held in treasury at cost: 69 and 57 shares
|
(6,904
|
)
|
|
(5,066
|
)
|
||
Total shareholders’ equity
|
47,513
|
|
|
45,699
|
|
||
Noncontrolling interests
|
72
|
|
|
1,155
|
|
||
Total equity
|
47,585
|
|
|
46,854
|
|
||
Total liabilities and equity
|
$
|
380,768
|
|
|
$
|
366,380
|
|
(a)
|
Our consolidated assets included the following for which we have elected the fair value option: Loans held for sale of $
1.7
billion, Loans of $
.9
billion, and Other assets of
|
(b)
|
Our consolidated liabilities included Other borrowed funds of $
.1
billion at both
December 31, 2017
and
December 31, 2016
, for which we have elected the fair value option.
|
(c)
|
Par value less than
$.5 million
at each date.
|
|
|
|
Shareholders’ Equity
|
|
|
|||||||||||||||||||||||
In millions
|
Shares
Outstanding
Common
Stock
|
|
|
Common
Stock
|
|
Capital
Surplus -
Preferred
Stock
|
|
Capital
Surplus -
Common
Stock and
Other
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Treasury
Stock
|
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
|
||||||||
Balance at January 1, 2015 (a)
|
523
|
|
|
$
|
2,705
|
|
$
|
3,946
|
|
$
|
12,627
|
|
$
|
26,200
|
|
$
|
503
|
|
$
|
(1,430
|
)
|
|
$
|
1,523
|
|
$
|
46,074
|
|
Net income
|
|
|
|
|
|
4,106
|
|
|
|
|
37
|
|
4,143
|
|
||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
(373
|
)
|
|
|
|
(373
|
)
|
|||||||||||||||
Cash dividends declared
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common ($2.01 per share)
|
|
|
|
|
|
(1,038
|
)
|
|
|
|
|
(1,038
|
)
|
|||||||||||||||
Preferred
|
|
|
|
|
|
(219
|
)
|
|
|
|
|
(219
|
)
|
|||||||||||||||
Preferred stock discount accretion
|
|
|
|
6
|
|
|
(6
|
)
|
|
|
|
|
|
|
||||||||||||||
Preferred stock redemption – Series K (b)
|
|
|
|
(500
|
)
|
|
|
|
|
|
|
(500
|
)
|
|||||||||||||||
Common stock activity
|
1
|
|
|
3
|
|
|
46
|
|
|
|
|
|
|
49
|
|
|||||||||||||
Treasury stock activity
|
(20
|
)
|
|
|
|
(56
|
)
|
|
|
(1,938
|
)
|
|
|
(1,994
|
)
|
|||||||||||||
Other
|
|
|
|
|
|
|
|
128
|
|
|
|
|
|
|
|
|
(290
|
)
|
(162
|
)
|
||||||||
Balance at December 31, 2015 (a)
|
504
|
|
|
$
|
2,708
|
|
$
|
3,452
|
|
$
|
12,745
|
|
$
|
29,043
|
|
$
|
130
|
|
$
|
(3,368
|
)
|
|
$
|
1,270
|
|
$
|
45,980
|
|
Net income
|
|
|
|
|
|
3,903
|
|
|
|
|
82
|
|
3,985
|
|
||||||||||||||
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
(395
|
)
|
|
|
|
(395
|
)
|
|||||||||||||||
Cash dividends declared
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Common ($2.12 per share)
|
|
|
|
|
|
(1,061
|
)
|
|
|
|
|
(1,061
|
)
|
|||||||||||||||
Preferred
|
|
|
|
|
|
(209
|
)
|
|
|
|
|
(209
|
)
|
|||||||||||||||
Preferred stock discount accretion
|
|
|
|
6
|
|
|
(6
|
)
|
|
|
|
|
|
|||||||||||||||
Preferred stock issuance – Series S (c)
|
|
|
|
519
|
|
|
|
|
|
|
|
519
|
|
|||||||||||||||
Common stock activity (d)
|
|
|
1
|
|
|
18
|
|
|
|
|
|
|
19
|
|
||||||||||||||
Treasury stock activity
|
(19
|
)
|
|
|
|
(131
|
)
|
|
|
(1,698
|
)
|
|
|
(1,829
|
)
|
|||||||||||||
Other
|
|
|
|
|
|
|
|
42
|
|
|
|
|
|
|
|
|
(197
|
)
|
(155
|
)
|
||||||||
Balance at December 31, 2016 (a)
|
485
|
|
|
$
|
2,709
|
|
$
|
3,977
|
|
$
|
12,674
|
|
$
|
31,670
|
|
$
|
(265
|
)
|
$
|
(5,066
|
)
|
|
$
|
1,155
|
|
$
|
46,854
|
|
Net income
|
|
|
|
|
|
5,338
|
|
|
|
|
50
|
|
5,388
|
|
||||||||||||||
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
117
|
|
|
|
|
117
|
|
|||||||||||||||
Cash dividends declared
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common ($2.60 per share)
|
|
|
|
|
|
(1,266
|
)
|
|
|
|
|
(1,266
|
)
|
|||||||||||||||
Preferred
|
|
|
|
|
|
(236
|
)
|
|
|
|
|
(236
|
)
|
|||||||||||||||
Preferred stock discount accretion
|
|
|
|
6
|
|
|
(6
|
)
|
|
|
|
|
|
|
||||||||||||||
Redemption of noncontrolling interests (e)
|
|
|
|
|
|
|
(19
|
)
|
|
|
|
(981
|
)
|
(1,000
|
)
|
|||||||||||||
Common stock activity (d)
|
|
|
1
|
|
|
17
|
|
|
|
|
|
|
18
|
|
||||||||||||||
Treasury stock activity
|
(12
|
)
|
|
|
|
(309
|
)
|
|
|
(1,838
|
)
|
|
|
(2,147
|
)
|
|||||||||||||
Other
|
|
|
|
|
|
2
|
|
7
|
|
|
|
|
|
|
|
|
(152
|
)
|
(143
|
)
|
||||||||
Balance at December 31, 2017 (a)
|
473
|
|
|
$
|
2,710
|
|
$
|
3,985
|
|
$
|
12,389
|
|
$
|
35,481
|
|
$
|
(148
|
)
|
$
|
(6,904
|
)
|
|
$
|
72
|
|
$
|
47,585
|
|
(a)
|
The par value of our preferred stock outstanding was less than
$.5 million
at each date and, therefore, is excluded from this presentation.
|
(b)
|
On May 4, 2015, we redeemed all
50,000
shares of our Series K preferred stock, as well as all
500,000
Depositary Shares representing fractional interests in such shares, resulting in net outflow of
$500 million
.
|
(c)
|
On November 1, 2016, PNC issued
5,250
shares of Series S preferred stock with a
$1
par value.
|
(d)
|
Common stock activity totaled less than
.5 million
shares issued.
|
(e)
|
Relates to the redemption of Perpetual Trust Securities in the first quarter of 2017. See Note
15
Equity
for additional information.
|
|
|
Year ended December 31
|
||||||||||
In millions
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Operating Activities
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
5,388
|
|
|
$
|
3,985
|
|
|
$
|
4,143
|
|
Adjustments to reconcile net income to net cash provided (used) by operating activities
|
|
|
|
|
|
|
||||||
Provision for credit losses
|
|
441
|
|
|
433
|
|
|
255
|
|
|||
Depreciation and amortization
|
|
1,117
|
|
|
1,193
|
|
|
1,088
|
|
|||
Deferred income taxes
|
|
(403
|
)
|
|
326
|
|
|
404
|
|
|||
Changes in fair value of mortgage servicing rights
|
|
323
|
|
|
179
|
|
|
274
|
|
|||
Gain on sales of Visa Class B common shares
|
|
|
|
|
(126
|
)
|
|
(169
|
)
|
|||
Undistributed earnings of BlackRock
|
|
(727
|
)
|
|
(361
|
)
|
|
(407
|
)
|
|||
Net change in
|
|
|
|
|
|
|
||||||
Trading securities and other short-term investments
|
|
305
|
|
|
(1,167
|
)
|
|
203
|
|
|||
Loans held for sale
|
|
(1,148
|
)
|
|
(935
|
)
|
|
393
|
|
|||
Other assets
|
|
757
|
|
|
(644
|
)
|
|
1,568
|
|
|||
Accrued expenses and other liabilities
|
|
(704
|
)
|
|
652
|
|
|
(1,788
|
)
|
|||
Other
|
|
350
|
|
|
100
|
|
|
(439
|
)
|
|||
Net cash provided (used) by operating activities
|
|
$
|
5,699
|
|
|
$
|
3,635
|
|
|
$
|
5,525
|
|
Investing Activities
|
|
|
|
|
|
|
||||||
Sales
|
|
|
|
|
|
|
||||||
Securities available for sale
|
|
$
|
5,647
|
|
|
$
|
3,456
|
|
|
$
|
6,723
|
|
Loans
|
|
2,001
|
|
|
1,897
|
|
|
2,040
|
|
|||
Repayments/maturities
|
|
|
|
|
|
|
||||||
Securities available for sale
|
|
10,734
|
|
|
11,061
|
|
|
7,920
|
|
|||
Securities held to maturity
|
|
2,948
|
|
|
3,209
|
|
|
2,032
|
|
|||
Purchases
|
|
|
|
|
|
|
||||||
Securities available for sale
|
|
(13,605
|
)
|
|
(19,495
|
)
|
|
(26,367
|
)
|
|||
Securities held to maturity
|
|
(5,605
|
)
|
|
(4,305
|
)
|
|
(4,896
|
)
|
|||
Loans
|
|
(841
|
)
|
|
(1,334
|
)
|
|
(748
|
)
|
|||
Net change in
|
|
|
|
|
|
|
||||||
Federal funds sold and resale agreements
|
|
(245
|
)
|
|
126
|
|
|
481
|
|
|||
Interest-earning deposits with banks
|
|
(2,884
|
)
|
|
4,835
|
|
|
1,233
|
|
|||
Loans
|
|
(10,483
|
)
|
|
(5,940
|
)
|
|
(3,972
|
)
|
|||
Net cash paid for acquisition
|
|
(1,342
|
)
|
|
|
|
|
|
|
|||
Other
|
|
(1,340
|
)
|
|
(952
|
)
|
|
(706
|
)
|
|||
Net cash provided (used) by investing activities
|
|
$
|
(15,015
|
)
|
|
$
|
(7,442
|
)
|
|
$
|
(16,260
|
)
|
|
|
Year ended December 31
|
||||||||||
In millions
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Financing Activities
|
|
|
|
|
|
|
||||||
Net change in
|
|
|
|
|
|
|
||||||
Noninterest-bearing deposits
|
|
$
|
(264
|
)
|
|
$
|
1,212
|
|
|
$
|
5,765
|
|
Interest-bearing deposits
|
|
8,255
|
|
|
7,367
|
|
|
10,812
|
|
|||
Federal funds purchased and repurchase agreements
|
|
(148
|
)
|
|
18
|
|
|
(1,733
|
)
|
|||
Commercial paper
|
|
100
|
|
|
|
|
|
|||||
Other borrowed funds
|
|
459
|
|
|
272
|
|
|
(9
|
)
|
|||
Sales/issuances
|
|
|
|
|
|
|
||||||
Federal Home Loan Bank borrowings
|
|
11,000
|
|
|
1,000
|
|
|
2,250
|
|
|||
Bank notes and senior debt
|
|
7,062
|
|
|
5,601
|
|
|
8,173
|
|
|||
Commercial paper
|
|
|
|
|
|
|
1,394
|
|
||||
Other borrowed funds
|
|
427
|
|
|
165
|
|
|
694
|
|
|||
Preferred stock
|
|
|
|
|
519
|
|
|
|
|
|||
Common and treasury stock
|
|
132
|
|
|
151
|
|
|
139
|
|
|||
Repayments/maturities
|
|
|
|
|
|
|
||||||
Federal Home Loan Bank borrowings
|
|
(7,512
|
)
|
|
(3,559
|
)
|
|
(2,147
|
)
|
|||
Bank notes and senior debt
|
|
(1,800
|
)
|
|
(3,750
|
)
|
|
(2,624
|
)
|
|||
Subordinated debt
|
|
(2,758
|
)
|
|
(488
|
)
|
|
(524
|
)
|
|||
Commercial paper
|
|
|
|
|
(14
|
)
|
|
(6,219
|
)
|
|||
Other borrowed funds
|
|
(318
|
)
|
|
(541
|
)
|
|
(1,622
|
)
|
|||
Preferred stock redemption
|
|
|
|
|
|
|
|
(500
|
)
|
|||
Redemption of noncontrolling interests
|
|
(1,000
|
)
|
|
|
|
|
|
|
|||
Acquisition of treasury stock
|
|
(2,447
|
)
|
|
(2,062
|
)
|
|
(2,152
|
)
|
|||
Preferred stock cash dividends paid
|
|
(236
|
)
|
|
(209
|
)
|
|
(219
|
)
|
|||
Common stock cash dividends paid
|
|
(1,266
|
)
|
|
(1,061
|
)
|
|
(1,038
|
)
|
|||
Net cash provided (used) by financing activities
|
|
9,686
|
|
|
4,621
|
|
|
10,440
|
|
|||
Net Increase (Decrease) In Cash And Due From Banks
|
|
370
|
|
|
814
|
|
|
(295
|
)
|
|||
Cash and due from banks at beginning of period
|
|
4,879
|
|
|
4,065
|
|
|
4,360
|
|
|||
Cash and due from banks at end of period
|
|
$
|
5,249
|
|
|
$
|
4,879
|
|
|
$
|
4,065
|
|
Supplemental Disclosures
|
|
|
|
|
|
|
||||||
Interest paid
|
|
$
|
1,743
|
|
|
$
|
1,317
|
|
|
$
|
1,005
|
|
Income taxes paid
|
|
$
|
72
|
|
|
$
|
658
|
|
|
$
|
919
|
|
Income taxes refunded
|
|
$
|
24
|
|
|
$
|
111
|
|
|
$
|
286
|
|
Non-cash Investing and Financing Items
|
|
|
|
|
|
|
||||||
Transfer from loans to loans held for sale, net
|
|
$
|
419
|
|
|
$
|
606
|
|
|
$
|
285
|
|
Transfer from loans to foreclosed assets
|
|
$
|
215
|
|
|
$
|
281
|
|
|
$
|
435
|
|
Transfer from trading securities to investment securities
|
|
$
|
192
|
|
|
|
|
|
|
|
•
|
Does not have equity investors with voting rights that can directly or indirectly make decisions about the entity’s activities through those voting rights or similar rights, or
|
•
|
Has equity investors that do not provide sufficient equity for the entity to finance its activities without additional subordinated financial support.
|
•
|
Lending,
|
•
|
Securities portfolio,
|
•
|
Asset management,
|
•
|
Customer deposits,
|
•
|
Loan sales, loan securitizations, and servicing,
|
•
|
Brokerage services,
|
•
|
Sale of loans and securities,
|
•
|
Certain private equity activities, and
|
•
|
Securities, derivatives and foreign exchange activities.
|
•
|
Issuing loan commitments, standby letters of credit and financial guarantees,
|
•
|
Selling various insurance products,
|
•
|
Providing treasury management services,
|
•
|
Providing merger and acquisition advisory and related services
|
•
|
Debit and credit card transactions, and
|
•
|
Participating in certain capital markets transactions.
|
•
|
Ownership interest,
|
•
|
Our plans for the investment, and
|
•
|
The nature of the investment.
|
•
|
Marketable equity securities are recorded on a trade-date basis and are accounted for based on the securities’ quoted market prices from a national securities exchange. Those purchased with the intention of selling in the near term are classified as trading and included in Other assets on our Consolidated Balance Sheet. Both realized and unrealized gains and losses on trading securities are included in Noninterest income. Marketable equity securities not classified as trading are designated as securities available for sale with unrealized gains and losses, net of income taxes, reflected in Accumulated other comprehensive income (loss). Any unrealized losses that we have determined to be other-than-temporary on securities classified as available for sale are recognized in current period earnings.
|
•
|
For investments in limited partnerships, limited liability companies and other investments that are not required to be consolidated, we use either the equity method or the cost method of accounting. We use the equity method for general and limited partner ownership interests and limited liability companies in which we are considered to have significant influence over the operations of the investee. Under the equity method, we record our equity ownership share of net income or loss of the investee in Noninterest income and any dividends received on equity method investments are recorded as a reduction to the investment balance. When an equity investment experiences an other-than-temporary decline in value, we may be required to record a loss on the investment. We use the cost method for all other investments. Under the cost method, there is no change to the cost basis unless there is an other-than-temporary decline in value or dividends received are considered a return on investment. If the decline is determined to be other-than-temporary, we write down the cost basis of the investment to a new cost basis that represents realizable value. The amount of the write-down is accounted for as a loss included in Noninterest income. Distributions received from the income of an investee on cost method investments are included in Noninterest income. Investments described above are included in Equity investments on our Consolidated Balance Sheet.
|
Commercial loans
|
||
Loans Classified as Nonperforming and Accounted for as Nonaccrual
|
|
• Loans accounted for at amortized cost where:
– The loan is 90 days or more past due.
– The loan is rated substandard or worse due to the determination that full collection of
principal and interest is not probable as demonstrated by the following conditions:
• The collection of principal or interest is 90 days or more past due;
• Reasonable doubt exists as to the certainty of the borrower’s future debt service
ability, according to the terms of the credit arrangement, regardless of whether 90
days have passed or not;
• The borrower has filed or will likely file for bankruptcy;
• The bank advances additional funds to cover principal or interest;
• We are in the process of liquidating a commercial borrower; or
• We are pursuing remedies under a guarantee.
|
Loans Excluded from Nonperforming Classification but Accounted for as Nonaccrual
|
|
• Loans accounted for under the fair value option and full collection of principal and interest
is not probable.
• Loans accounted for at the lower of cost or market less costs to sell (held for sale) and full
collection of principal and interest is not probable.
|
Loans Excluded from Nonperforming Classification and Nonaccrual Accounting
|
|
• Loans that are well secured and in the process of collection.
|
•
|
The bank holds a subordinate lien position in the loan and a foreclosure notice has been received on the first lien loan;
|
•
|
The bank holds a subordinate lien position in the loan which is 30 days or more past due with a combined loan to value ratio of greater than or equal to 110% and the first lien loan is seriously stressed (
i.e
., 90 days or more past due);
|
•
|
The loan is modified or otherwise restructured in a manner that results in the loan becoming collateral dependent;
|
•
|
Notification of bankruptcy has been received within the last 60 days;
|
•
|
The borrower has been discharged from personal liability through Chapter 7 bankruptcy and has not formally reaffirmed his or her loan obligation to us; or
|
•
|
The collateral securing the loan has been repossessed and the value of the collateral is less than the recorded investment of the loan outstanding.
|
•
|
Probability of default (PD),
|
•
|
Loss given default (LGD),
|
•
|
Outstanding balance of the loan,
|
•
|
Movement through delinquency stages,
|
•
|
Amounts and timing of expected future cash flows,
|
•
|
Value of collateral, which may be obtained from third parties, and
|
•
|
Qualitative factors, such as changes in current economic conditions, that may not be reflected in modeled results.
|
•
|
For commercial nonperforming loans and commercial TDRs greater than or equal to a defined dollar threshold, specific reserves are based on an analysis of the present value of the loan’s expected future cash flows, the loan’s observable market price or the fair value of the collateral.
|
•
|
For commercial nonperforming loans and commercial TDRs below the defined dollar threshold, the individual loan’s loss given default (LGD) percentage is multiplied by the loan balance and the results are aggregated for purposes of measuring specific reserve impairment.
|
•
|
Consumer nonperforming loans are collectively reserved for unless classified as consumer TDRs. For consumer TDRs, specific reserves are determined through an analysis of the present value of the loan’s expected future cash flows, except for those instances
|
•
|
Industry concentrations and conditions,
|
•
|
Recent credit quality trends,
|
•
|
Recent loss experience in particular portfolios,
|
•
|
Recent macro-economic factors,
|
•
|
Model imprecision,
|
•
|
Changes in lending policies and procedures,
|
•
|
Timing of available information, including the performance of first lien positions, and
|
•
|
Limitations of available historical data.
|
•
|
Deposit balances and interest rates for escrow and commercial reserve earnings,
|
•
|
Discount rates,
|
•
|
Estimated prepayment speeds, and
|
•
|
Estimated servicing costs.
|
In millions
|
Residential
Mortgages |
|
|
Commercial
Mortgages (a) |
|
|
|||
CASH FLOWS - Year ended
December 31, 2017 |
|
|
|
|
|
||||
Sales of loans (b)
|
$
|
5,759
|
|
|
|
$
|
5,276
|
|
|
Repurchases of previously transferred loans (c)
|
$
|
464
|
|
|
|
|
|
||
Servicing fees (d)
|
$
|
374
|
|
|
|
$
|
126
|
|
|
Servicing advances recovered/(funded), net
|
$
|
101
|
|
|
|
$
|
48
|
|
|
Cash flows on mortgage-backed securities
held (e) |
$
|
1,527
|
|
|
|
$
|
206
|
|
|
CASH FLOWS - Year ended
December 31, 2016 |
|
|
|
|
|
||||
Sales of loans (b)
|
$
|
6,913
|
|
|
|
$
|
3,810
|
|
|
Repurchases of previously transferred loans (c)
|
$
|
534
|
|
|
|
|
|
||
Servicing fees (d)
|
$
|
374
|
|
|
|
$
|
125
|
|
|
Servicing advances recovered/(funded), net
|
$
|
109
|
|
|
|
$
|
(14
|
)
|
|
Cash flows on mortgage-backed securities
held (e) |
$
|
1,727
|
|
|
|
$
|
283
|
|
|
(a)
|
Represents cash flow information associated with both commercial mortgage loan transfer and servicing activities.
|
(b)
|
Gains/losses recognized on sales of loans were insignificant for the periods presented.
|
(c)
|
Includes residential mortgage government insured or guaranteed loans eligible for repurchase through the exercise of our removal of account provision option, and loans repurchased due to alleged breaches of origination covenants or representations and warranties made to purchasers.
|
(d)
|
Includes contractually specified servicing fees, late charges and ancillary fees.
|
(e)
|
Represents cash flows on securities we hold issued by a securitization SPE in which we transferred to and/or services loans. The carrying values of such securities held were
$8.8 billion
in residential mortgage-backed securities and
$.6 billion
in commercial mortgage-backed securities at
December 31, 2017
and
$6.9 billion
in residential mortgage-backed securities and
$.9 billion
in commercial mortgage-backed securities at
December 31, 2016
.
|
In millions
|
Residential
Mortgages |
|
|
|
Commercial
Mortgages (a) |
|
|
||
December 31, 2017
|
|
|
|
|
|
||||
Total principal balance
|
$
|
58,320
|
|
|
|
$
|
49,116
|
|
|
Delinquent loans (b)
|
$
|
899
|
|
|
|
$
|
355
|
|
|
December 31, 2016
|
|
|
|
|
|
||||
Total principal balance
|
$
|
66,081
|
|
|
|
$
|
45,855
|
|
|
Delinquent loans (b)
|
$
|
1,422
|
|
|
|
$
|
941
|
|
|
Year ended December 31, 2017
|
|
|
|
|
|
||||
Net charge-offs (c)
|
$
|
78
|
|
|
|
$
|
965
|
|
|
Year ended December 31, 2016
|
|
|
|
|
|
||||
Net charge-offs (c)
|
$
|
97
|
|
|
|
$
|
1,439
|
|
|
(a)
|
Represents information at the securitization level in which we have sold loans and we are the servicer for the securitization.
|
(b)
|
Serviced delinquent loans are 90 days or more past due or are in process of foreclosure.
|
(c)
|
Net charge-offs for Residential mortgages represent credit losses less recoveries distributed and as reported to investors during the period. Net charge-offs for Commercial mortgages represent credit losses less recoveries distributed and as reported by the trustee for commercial mortgage backed securitizations. Realized losses for Agency securitizations are not reflected as we do not manage the underlying real estate upon foreclosure and, as such, do not have access to loss information.
|
In millions
|
PNC Risk of Loss (a)
|
|
|
|
Carrying Value of Assets
Owned by PNC |
|
|
|
|
Carrying Value of Liabilities
Owned by PNC |
|
|
|||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||
Mortgage-Backed Securitizations (b)
|
$
|
9,738
|
|
|
|
$
|
9,738
|
|
(c)
|
|
|
|
|
||
Tax Credit Investments and Other
|
3,069
|
|
|
|
3,001
|
|
(d)
|
|
|
$
|
858
|
|
(e)
|
||
Total
|
$
|
12,807
|
|
|
|
$
|
12,739
|
|
|
|
|
$
|
858
|
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||
Mortgage-Backed Securitizations (b)
|
$
|
8,003
|
|
|
|
$
|
8,003
|
|
(c)
|
|
|
|
|
||
Tax Credit Investments and Other
|
3,083
|
|
|
|
3,043
|
|
(d)
|
|
|
$
|
823
|
|
(e)
|
||
Total
|
$
|
11,086
|
|
|
|
$
|
11,046
|
|
|
|
|
$
|
823
|
|
|
(a)
|
This represents loans, investments and other assets related to non-consolidated VIEs, net of collateral (if applicable).
|
(b)
|
Amounts reflect involvement with securitization SPEs where we transferred to and/or services loans for an SPE and we hold securities issued by that SPE. Values disclosed in the PNC Risk of Loss column represent our maximum exposure to loss for those securities’ holdings.
|
(c)
|
Included in Investment securities, Mortgage servicing rights and Other assets on our Consolidated Balance Sheet.
|
(d)
|
Included in Investment securities, Loans, Equity investments and Other assets on our Consolidated Balance Sheet.
|
(e)
|
Included in Deposits and Other liabilities on our Consolidated Balance Sheet.
|
|
|
Accruing
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Dollars in millions
|
|
Current or Less
Than 30 Days
Past Due
|
|
|
30-59
Days
Past Due
|
|
|
60-89
Days
Past Due
|
|
|
90 Days
Or More
Past Due
|
|
|
Total
Past
Due (b)
|
|
|
|
Nonperforming
Loans
|
|
|
Fair Value
Option
Nonaccrual
Loans (c)
|
|
|
Purchased
Impaired
Loans
|
|
|
Total
Loans (d)
|
|
|||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial Lending
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial
|
|
$
|
109,989
|
|
|
$
|
45
|
|
|
$
|
25
|
|
|
$
|
39
|
|
|
$
|
109
|
|
|
|
$
|
429
|
|
|
|
|
|
|
$
|
110,527
|
|
||||
Commercial real estate
|
|
28,826
|
|
|
27
|
|
|
2
|
|
|
|
|
29
|
|
|
|
123
|
|
|
|
|
|
|
28,978
|
|
||||||||||||
Equipment lease
financing |
|
7,914
|
|
|
17
|
|
|
1
|
|
|
|
|
18
|
|
|
|
2
|
|
|
|
|
|
|
7,934
|
|
||||||||||||
Total commercial lending
|
|
146,729
|
|
|
89
|
|
|
28
|
|
|
39
|
|
|
156
|
|
|
|
554
|
|
|
|
|
|
|
|
|
147,439
|
|
|||||||||
Consumer Lending
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Home equity
|
|
26,561
|
|
|
78
|
|
|
26
|
|
|
|
|
|
$
|
104
|
|
|
|
818
|
|
|
|
|
$
|
881
|
|
|
28,364
|
|
||||||||
Residential real estate
|
|
14,389
|
|
|
151
|
|
|
74
|
|
|
486
|
|
|
711
|
|
(b)
|
|
400
|
|
|
$
|
197
|
|
|
1,515
|
|
|
17,212
|
|
||||||||
Credit card
|
|
5,579
|
|
|
43
|
|
|
26
|
|
|
45
|
|
|
114
|
|
|
|
6
|
|
|
|
|
|
|
5,699
|
|
|||||||||||
Other consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Automobile
|
|
12,697
|
|
|
79
|
|
|
20
|
|
|
8
|
|
|
107
|
|
|
|
76
|
|
|
|
|
|
|
12,880
|
|
|||||||||||
Education and other
|
|
8,525
|
|
|
105
|
|
|
64
|
|
|
159
|
|
|
328
|
|
(b)
|
|
11
|
|
|
|
|
|
|
8,864
|
|
|||||||||||
Total consumer lending
|
|
67,751
|
|
|
456
|
|
|
210
|
|
|
698
|
|
|
1,364
|
|
|
|
1,311
|
|
|
197
|
|
|
2,396
|
|
|
73,019
|
|
|||||||||
Total
|
|
$
|
214,480
|
|
|
$
|
545
|
|
|
$
|
238
|
|
|
$
|
737
|
|
|
$
|
1,520
|
|
|
|
$
|
1,865
|
|
|
$
|
197
|
|
|
$
|
2,396
|
|
|
$
|
220,458
|
|
Percentage of total loans
|
|
97.29
|
%
|
|
.25
|
%
|
|
.11
|
%
|
|
.33
|
%
|
|
.69
|
%
|
|
|
.85
|
%
|
|
.09
|
%
|
|
1.08
|
%
|
|
100.00
|
%
|
|||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial Lending
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial
|
|
$
|
100,710
|
|
|
$
|
81
|
|
|
$
|
20
|
|
|
$
|
39
|
|
|
$
|
140
|
|
|
|
$
|
496
|
|
|
|
|
$
|
18
|
|
|
$
|
101,364
|
|
||
Commercial real estate
|
|
28,769
|
|
|
5
|
|
|
2
|
|
|
|
|
7
|
|
|
|
143
|
|
|
|
|
91
|
|
|
29,010
|
|
|||||||||||
Equipment lease
financing |
|
7,535
|
|
|
29
|
|
|
1
|
|
|
|
|
30
|
|
|
|
16
|
|
|
|
|
|
|
7,581
|
|
||||||||||||
Total commercial lending
|
|
137,014
|
|
|
115
|
|
|
23
|
|
|
39
|
|
|
177
|
|
|
|
655
|
|
|
|
|
|
109
|
|
|
137,955
|
|
|||||||||
Consumer Lending
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Home equity
|
|
27,820
|
|
|
64
|
|
|
30
|
|
|
|
|
94
|
|
|
|
914
|
|
|
|
|
1,121
|
|
|
29,949
|
|
|||||||||||
Residential real estate
|
|
12,425
|
|
|
159
|
|
|
68
|
|
|
500
|
|
|
727
|
|
(b)
|
|
501
|
|
|
$
|
219
|
|
|
1,726
|
|
|
15,598
|
|
||||||||
Credit card
|
|
5,187
|
|
|
33
|
|
|
21
|
|
|
37
|
|
|
91
|
|
|
|
4
|
|
|
|
|
|
|
5,282
|
|
|||||||||||
Other consumer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Automobile
|
|
12,257
|
|
|
51
|
|
|
12
|
|
|
5
|
|
|
68
|
|
|
|
55
|
|
|
|
|
|
|
12,380
|
|
|||||||||||
Education and other
|
|
9,235
|
|
|
140
|
|
|
78
|
|
|
201
|
|
|
419
|
|
(b)
|
|
15
|
|
|
|
|
|
|
9,669
|
|
|||||||||||
Total consumer lending
|
|
66,924
|
|
|
447
|
|
|
209
|
|
|
743
|
|
|
1,399
|
|
|
|
1,489
|
|
|
219
|
|
|
2,847
|
|
|
72,878
|
|
|||||||||
Total
|
|
$
|
203,938
|
|
|
$
|
562
|
|
|
$
|
232
|
|
|
$
|
782
|
|
|
$
|
1,576
|
|
|
|
$
|
2,144
|
|
|
$
|
219
|
|
|
$
|
2,956
|
|
|
$
|
210,833
|
|
Percentage of total loans
|
|
96.73
|
%
|
|
.27
|
%
|
|
.11
|
%
|
|
.37
|
%
|
|
.75
|
%
|
|
|
1.02
|
%
|
|
.10
|
%
|
|
1.40
|
%
|
|
100.00
|
%
|
(a)
|
Amounts in table represent recorded investment and exclude loans held for sale. Recorded investment in a loan includes the unpaid principal balance plus net accounting adjustments, less any charge-offs. Recorded investment does not include any associated valuation allowance.
|
(b)
|
Past due loan amounts exclude purchased impaired loans, even if contractually past due (or if we do not expect to receive payment in full based on the original contractual terms), as we are currently accreting interest income over the expected life of the loans. Past due loan amounts include government insured or guaranteed Residential real estate mortgages totaling
$.6 billion
at both
December 31, 2017
and
December 31, 2016
, and Education and other consumer loans totaling
$.3 billion
and
$.4 billion
at
December 31, 2017
and
December 31, 2016
, respectively.
|
(c)
|
Consumer loans accounted for under the fair value option for which we do not expect to collect substantially all principal and interest are subject to nonaccrual accounting and classification upon meeting any of our nonaccrual policies. Given that these loans are not accounted for at amortized cost, these loans have been excluded from the nonperforming loan population.
|
(d)
|
Net of unearned income, net deferred loan fees, unamortized discounts and premiums, and purchase discounts and premiums totaling
$1.2 billion
and
$1.3 billion
at
December 31, 2017
and
December 31, 2016
, respectively.
|
Dollars in millions
|
|
December 31
2017 |
|
|
December 31
2016 |
|
|
||
Nonperforming loans
|
|
|
|
|
|
||||
Total commercial lending
|
|
$
|
554
|
|
|
$
|
655
|
|
|
Total consumer lending (a)
|
|
1,311
|
|
|
1,489
|
|
|
||
Total nonperforming loans
|
|
1,865
|
|
|
2,144
|
|
|
||
OREO, foreclosed and other assets
|
|
170
|
|
|
230
|
|
|
||
Total nonperforming assets
|
|
$
|
2,035
|
|
|
$
|
2,374
|
|
|
Nonperforming loans to total loans
|
|
.85
|
%
|
|
1.02
|
%
|
|
||
Nonperforming assets to total loans,
OREO, foreclosed and other assets
|
|
.92
|
%
|
|
1.12
|
%
|
|
||
Nonperforming assets to total assets
|
|
.53
|
%
|
|
.65
|
%
|
|
||
Interest on nonperforming loans (b)
|
|
|
|
|
|
||||
Computed on original terms
|
|
$
|
114
|
|
|
$
|
111
|
|
|
Recognized prior to nonperforming
status
|
|
$
|
19
|
|
|
$
|
21
|
|
|
(a)
|
Excludes most consumer loans and lines of credit not secured by residential real estate, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.
|
(b)
|
Amounts are for the year ended.
|
|
|
|
|
Criticized Commercial Loans
|
|
|
||||||||||||||
In millions
|
|
Pass Rated
|
|
|
Special
Mention (b)
|
|
|
Substandard (c)
|
|
|
Doubtful (d)
|
|
|
Total Loans
|
|
|||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
$
|
105,280
|
|
|
$
|
1,858
|
|
|
$
|
3,331
|
|
|
$
|
58
|
|
|
$
|
110,527
|
|
Commercial real estate
|
|
28,380
|
|
|
148
|
|
|
435
|
|
|
15
|
|
|
28,978
|
|
|||||
Equipment lease financing
|
|
7,754
|
|
|
77
|
|
|
102
|
|
|
1
|
|
|
7,934
|
|
|||||
Total commercial lending
|
|
$
|
141,414
|
|
|
$
|
2,083
|
|
|
$
|
3,868
|
|
|
$
|
74
|
|
|
$
|
147,439
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
$
|
96,231
|
|
|
$
|
1,612
|
|
|
$
|
3,449
|
|
|
$
|
72
|
|
|
$
|
101,364
|
|
Commercial real estate
|
|
28,561
|
|
|
98
|
|
|
327
|
|
|
24
|
|
|
29,010
|
|
|||||
Equipment lease financing
|
|
7,395
|
|
|
89
|
|
|
91
|
|
|
6
|
|
|
7,581
|
|
|||||
Total commercial lending
|
|
$
|
132,187
|
|
|
$
|
1,799
|
|
|
$
|
3,867
|
|
|
$
|
102
|
|
|
$
|
137,955
|
|
(a)
|
Loans are classified as “Pass”, “Special Mention”, “Substandard” and “Doubtful” based on the Regulatory Classification definitions. We use PDs and LGDs to rate commercial loans.
|
(b)
|
Special Mention rated loans have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects at some future date. These loans do not expose us to sufficient risk to warrant a more adverse classification at the reporting date.
|
(c)
|
Substandard rated loans have a well-defined weakness or weaknesses that jeopardize the collection or liquidation of debt. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.
|
(d)
|
Doubtful rated loans possess all the inherent weaknesses of a Substandard loan with the additional characteristics that the weakness makes collection or liquidation in full improbable due to existing facts, conditions, and values.
|
|
|
Home Equity
|
|
Residential
Real Estate
|
|
Total
|
|
|||||||||
December 31, 2017 – in millions
|
|
1st Liens
|
|
|
2nd Liens
|
|
|
|
||||||||
Current estimated LTV ratios
|
|
|
|
|
|
|
|
|
||||||||
Greater than or equal to 125% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
$
|
108
|
|
|
$
|
385
|
|
|
$
|
126
|
|
|
$
|
619
|
|
Less than or equal to 660 (b)
|
|
21
|
|
|
64
|
|
|
23
|
|
|
108
|
|
||||
Missing FICO
|
|
1
|
|
|
5
|
|
|
1
|
|
|
7
|
|
||||
Greater than or equal to 100% to less than 125% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
300
|
|
|
842
|
|
|
253
|
|
|
1,395
|
|
||||
Less than or equal to 660 (b)
|
|
46
|
|
|
143
|
|
|
45
|
|
|
234
|
|
||||
Missing FICO
|
|
2
|
|
|
9
|
|
|
5
|
|
|
16
|
|
||||
Greater than or equal to 90% to less than 100% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
331
|
|
|
890
|
|
|
324
|
|
|
1,545
|
|
||||
Less than or equal to 660
|
|
55
|
|
|
134
|
|
|
55
|
|
|
244
|
|
||||
Missing FICO
|
|
2
|
|
|
9
|
|
|
4
|
|
|
15
|
|
||||
Less than 90% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
13,954
|
|
|
8,066
|
|
|
13,445
|
|
|
35,465
|
|
||||
Less than or equal to 660
|
|
1,214
|
|
|
774
|
|
|
507
|
|
|
2,495
|
|
||||
Missing FICO
|
|
42
|
|
|
57
|
|
|
95
|
|
|
194
|
|
||||
Total home equity and residential real estate loans
|
|
$
|
16,076
|
|
|
$
|
11,378
|
|
|
$
|
14,883
|
|
|
$
|
42,337
|
|
|
|
Home Equity
|
|
Residential
Real Estate
|
|
Total
|
|
|||||||||
December 31, 2016 – in millions
|
|
1st Liens
|
|
|
2nd Liens
|
|
|
|
||||||||
Current estimated LTV ratios
|
|
|
|
|
|
|
|
|
||||||||
Greater than or equal to 125% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
$
|
161
|
|
|
$
|
629
|
|
|
$
|
174
|
|
|
$
|
964
|
|
Less than or equal to 660 (b)
|
|
32
|
|
|
110
|
|
|
35
|
|
|
177
|
|
||||
Missing FICO
|
|
1
|
|
|
9
|
|
|
2
|
|
|
12
|
|
||||
Greater than or equal to 100% to less than 125% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
394
|
|
|
1,190
|
|
|
345
|
|
|
1,929
|
|
||||
Less than or equal to 660 (b)
|
|
66
|
|
|
211
|
|
|
76
|
|
|
353
|
|
||||
Missing FICO
|
|
3
|
|
|
10
|
|
|
7
|
|
|
20
|
|
||||
Greater than or equal to 90% to less than 100% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
453
|
|
|
1,100
|
|
|
463
|
|
|
2,016
|
|
||||
Less than or equal to 660
|
|
77
|
|
|
171
|
|
|
78
|
|
|
326
|
|
||||
Missing FICO
|
|
1
|
|
|
8
|
|
|
6
|
|
|
15
|
|
||||
Less than 90% and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 660
|
|
14,047
|
|
|
7,913
|
|
|
11,153
|
|
|
33,113
|
|
||||
Less than or equal to 660
|
|
1,323
|
|
|
822
|
|
|
586
|
|
|
2,731
|
|
||||
Missing FICO
|
|
42
|
|
|
55
|
|
|
102
|
|
|
199
|
|
||||
Missing LTV and updated FICO scores:
|
|
|
|
|
|
|
|
|
||||||||
Greater than 600
|
|
|
|
|
|
1
|
|
|
1
|
|
||||||
Total home equity and residential real estate loans
|
|
$
|
16,600
|
|
|
$
|
12,228
|
|
|
$
|
13,028
|
|
|
$
|
41,856
|
|
(a)
|
Amounts shown represent recorded investment.
|
(b)
|
Higher risk loans are defined as loans with both an updated FICO score of less than or equal to 660 and an updated LTV greater than or equal to
100%
. The following states had the highest percentage of higher risk loans at
December 31, 2017
: New Jersey
17%
, Pennsylvania
13%
, Illinois
13%
, Ohio
9%
, Maryland
8%
, Florida
6%
, North Carolina
5%
and Michigan
4%
. The remainder of the states had lower than
4%
of the higher risk loans individually, and collectively they represent approximately
25%
of the higher risk loans. The following states had the highest percentage of higher risk loans at
December 31, 2016
: New Jersey
16%
, Pennsylvania
14%
, Illinois
12%
, Ohio
10%
, Florida
7%
, Maryland
6%
, Michigan
4%
and North Carolina
4%
. The remainder of the states had lower than
4%
of the high risk loans individually, and collectively they represent approximately
27%
of the higher risk loans.
|
|
|
Credit Card
|
|
|
Other Consumer (a)
|
|
||||||||||
Dollars in millions
|
|
Amount
|
|
|
% of Total Loans
Using FICO
Credit Metric
|
|
|
|
Amount
|
|
|
% of Total Loans
Using FICO
Credit Metric
|
|
|
||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||
FICO score greater than 719
|
|
$
|
3,457
|
|
|
61
|
%
|
|
|
$
|
10,366
|
|
|
63
|
%
|
|
650 to 719
|
|
1,596
|
|
|
28
|
%
|
|
|
4,352
|
|
|
27
|
%
|
|
||
620 to 649
|
|
250
|
|
|
4
|
%
|
|
|
659
|
|
|
4
|
%
|
|
||
Less than 620
|
|
272
|
|
|
5
|
%
|
|
|
715
|
|
|
4
|
%
|
|
||
No FICO score available or required (b)
|
|
124
|
|
|
2
|
%
|
|
|
314
|
|
|
2
|
%
|
|
||
Total loans using FICO credit metric
|
|
5,699
|
|
|
100
|
%
|
|
|
16,406
|
|
|
100
|
%
|
|
||
Consumer loans using other internal credit metrics (a)
|
|
|
|
|
|
|
5,338
|
|
|
|
|
|||||
Total loan balance
|
|
$
|
5,699
|
|
|
|
|
|
$
|
21,744
|
|
|
|
|
||
Weighted-average updated FICO score (b)
|
|
|
|
|
735
|
|
|
|
|
|
|
741
|
|
|
||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||
FICO score greater than 719
|
|
$
|
3,244
|
|
|
61
|
%
|
|
|
$
|
10,247
|
|
|
65
|
%
|
|
650 to 719
|
|
1,466
|
|
|
28
|
%
|
|
|
3,873
|
|
|
25
|
%
|
|
||
620 to 649
|
|
215
|
|
|
4
|
%
|
|
|
552
|
|
|
3
|
%
|
|
||
Less than 620
|
|
229
|
|
|
4
|
%
|
|
|
632
|
|
|
4
|
%
|
|
||
No FICO score available or required (b)
|
|
128
|
|
|
3
|
%
|
|
|
489
|
|
|
3
|
%
|
|
||
Total loans using FICO credit metric
|
|
5,282
|
|
|
100
|
%
|
|
|
15,793
|
|
|
100
|
%
|
|
||
Consumer loans using other internal credit metrics (a)
|
|
|
|
|
|
|
6,256
|
|
|
|
|
|||||
Total loan balance
|
|
$
|
5,282
|
|
|
|
|
|
$
|
22,049
|
|
|
|
|
||
Weighted-average updated FICO score (b)
|
|
|
|
|
736
|
|
|
|
|
|
|
744
|
|
|
(a)
|
We use updated FICO scores as an asset quality indicator for non-government guaranteed or insured education loans, automobile loans and other secured and unsecured lines and loans. We use internal credit metrics, such as delinquency status, geography or other factors, as an asset quality indicator for government guaranteed or insured education loans and consumer loans to high net worth individuals, as internal credit metrics are more relevant than FICO scores for these types of loans.
|
(b)
|
Credit card loans and other consumer loans with no FICO score available or required generally refers to new accounts issued to borrowers with limited credit history, accounts for which we cannot obtain an updated FICO score (e.g., recent profile changes), cards issued with a business name and/or cards secured by collateral. Management proactively assesses the risk and size of this loan portfolio and, when necessary, takes actions to mitigate the credit risk. Weighted-average updated FICO score excludes accounts with no FICO score available or required.
|
|
|
Number
of Loans
|
|
|
|
Pre-TDR
Recorded
Investment (b)
|
|
|
|
Post-TDR Recorded Investment (c)
|
||||||||||||||||
During the year ended December 31, 2017
Dollars in millions |
|
|
Principal
Forgiveness
|
|
|
Rate
Reduction
|
|
|
Other
|
|
|
|
Total
|
|
||||||||||||
Total commercial lending
|
|
120
|
|
|
|
$
|
293
|
|
|
|
$
|
18
|
|
|
$
|
7
|
|
|
$
|
227
|
|
|
|
$
|
252
|
|
Total consumer lending
|
|
11,993
|
|
|
|
248
|
|
|
|
|
|
|
146
|
|
|
97
|
|
|
|
243
|
|
|||||
Total TDRs
|
|
12,113
|
|
|
|
$
|
541
|
|
|
|
$
|
18
|
|
|
$
|
153
|
|
|
$
|
324
|
|
|
|
$
|
495
|
|
During the year ended December 31, 2016
Dollars in millions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total commercial lending
|
|
143
|
|
|
|
$
|
524
|
|
|
|
|
|
|
$
|
57
|
|
|
$
|
413
|
|
|
|
$
|
470
|
|
|
Total consumer lending
|
|
11,262
|
|
|
|
245
|
|
|
|
|
|
|
157
|
|
|
76
|
|
|
|
233
|
|
|||||
Total TDRs
|
|
11,405
|
|
|
|
$
|
769
|
|
|
|
|
|
|
$
|
214
|
|
|
$
|
489
|
|
|
|
$
|
703
|
|
|
During the year ended December 31, 2015
Dollars in millions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total commercial lending
|
|
158
|
|
|
|
$
|
284
|
|
|
|
$
|
22
|
|
|
$
|
4
|
|
|
$
|
198
|
|
|
|
$
|
224
|
|
Total consumer lending
|
|
10,962
|
|
|
|
311
|
|
|
|
|
|
|
190
|
|
|
106
|
|
|
|
296
|
|
|||||
Total TDRs
|
|
11,120
|
|
|
|
$
|
595
|
|
|
|
$
|
22
|
|
|
$
|
194
|
|
|
$
|
304
|
|
|
|
$
|
520
|
|
(a)
|
Impact of partial charge-offs at TDR date are included in this table.
|
(b)
|
Represents the recorded investment of the loans as of the quarter end prior to TDR designation, and excludes immaterial amounts of accrued interest receivable.
|
(c)
|
Represents the recorded investment of the TDRs as of the end of the quarter in which the TDR occurs, and excludes immaterial amounts of accrued interest receivable.
|
In millions
|
|
Unpaid
Principal
Balance
|
|
|
Recorded
Investment
|
|
|
Associated
Allowance
|
|
|
Average
Recorded
Investment (a)
|
|
||||
December 31, 2017
|
|
|
|
|
|
|
|
|
||||||||
Impaired loans with an associated allowance
|
|
|
|
|
|
|
|
|
||||||||
Total commercial lending
|
|
$
|
580
|
|
|
$
|
353
|
|
|
$
|
76
|
|
|
$
|
419
|
|
Total consumer lending
|
|
1,061
|
|
|
1,014
|
|
|
195
|
|
|
1,072
|
|
||||
Total impaired loans with an associated allowance
|
|
1,641
|
|
|
1,367
|
|
|
271
|
|
|
1,491
|
|
||||
Impaired loans without an associated allowance
|
|
|
|
|
|
|
|
|
||||||||
Total commercial lending
|
|
494
|
|
|
366
|
|
|
|
|
330
|
|
|||||
Total consumer lending
|
|
1,019
|
|
|
638
|
|
|
|
|
648
|
|
|||||
Total impaired loans without an associated allowance
|
|
1,513
|
|
|
1,004
|
|
|
|
|
|
978
|
|
||||
Total impaired loans
|
|
$
|
3,154
|
|
|
$
|
2,371
|
|
|
$
|
271
|
|
|
$
|
2,469
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
||||||||
Impaired loans with an associated allowance
|
|
|
|
|
|
|
|
|
||||||||
Total commercial lending
|
|
$
|
742
|
|
|
$
|
477
|
|
|
$
|
105
|
|
|
$
|
497
|
|
Total consumer lending
|
|
1,237
|
|
|
1,185
|
|
|
226
|
|
|
1,255
|
|
||||
Total impaired loans with an associated allowance
|
|
1,979
|
|
|
1,662
|
|
|
331
|
|
|
1,752
|
|
||||
Impaired loans without an associated allowance
|
|
|
|
|
|
|
|
|
||||||||
Total commercial lending
|
|
447
|
|
|
322
|
|
|
|
|
365
|
|
|||||
Total consumer lending
|
|
982
|
|
|
608
|
|
|
|
|
|
604
|
|
||||
Total impaired loans without an associated allowance
|
|
1,429
|
|
|
930
|
|
|
|
|
|
969
|
|
||||
Total impaired loans
|
|
$
|
3,408
|
|
|
$
|
2,592
|
|
|
$
|
331
|
|
|
$
|
2,721
|
|
(a)
|
Average recorded investment is for the years ended
December 31, 2017
and
2016
.
|
Dollars in millions
|
|
Commercial
Lending
|
|
|
Consumer
Lending
|
|
|
Total
|
|
|
|||
December 31, 2017
|
|
|
|
|
|
|
|
||||||
Allowance for Loan and Lease Losses
|
|
|
|
|
|
|
|
||||||
January 1
|
|
$
|
1,534
|
|
|
$
|
1,055
|
|
|
$
|
2,589
|
|
|
Charge-offs
|
|
(221
|
)
|
|
(565
|
)
|
|
(786
|
)
|
|
|||
Recoveries
|
|
116
|
|
|
213
|
|
|
329
|
|
|
|||
Net (charge-offs)
|
|
(105
|
)
|
|
(352
|
)
|
|
(457
|
)
|
|
|||
Provision for credit losses
|
|
147
|
|
|
294
|
|
|
441
|
|
|
|||
Net decrease / (increase) in allowance for unfunded loan commitments
and letters of credit
|
|
5
|
|
|
(1
|
)
|
|
4
|
|
|
|||
Other
|
|
1
|
|
|
33
|
|
|
34
|
|
|
|||
December 31
|
|
$
|
1,582
|
|
|
$
|
1,029
|
|
|
$
|
2,611
|
|
|
TDRs individually evaluated for impairment
|
|
$
|
35
|
|
|
$
|
195
|
|
|
$
|
230
|
|
|
Other loans individually evaluated for impairment
|
|
41
|
|
|
|
|
41
|
|
|
||||
Loans collectively evaluated for impairment
|
|
1,506
|
|
|
561
|
|
|
2,067
|
|
|
|||
Purchased impaired loans
|
|
|
|
273
|
|
|
273
|
|
|
||||
December 31
|
|
$
|
1,582
|
|
|
$
|
1,029
|
|
|
$
|
2,611
|
|
|
Loan Portfolio
|
|
|
|
|
|
|
|
||||||
TDRs individually evaluated for impairment
|
|
$
|
409
|
|
|
$
|
1,652
|
|
|
$
|
2,061
|
|
|
Other loans individually evaluated for impairment
|
|
310
|
|
|
|
|
310
|
|
|
||||
Loans collectively evaluated for impairment
|
|
146,720
|
|
|
68,102
|
|
|
214,822
|
|
|
|||
Fair value option loans (a)
|
|
|
|
869
|
|
|
869
|
|
|
||||
Purchased impaired loans
|
|
|
|
2,396
|
|
|
2,396
|
|
|
||||
December 31
|
|
$
|
147,439
|
|
|
$
|
73,019
|
|
|
$
|
220,458
|
|
|
Portfolio segment ALLL as a percentage of total ALLL
|
|
61
|
%
|
|
39
|
%
|
|
100
|
%
|
|
|||
Ratio of the allowance for loan and lease losses to total loans
|
|
1.07
|
%
|
|
1.41
|
%
|
|
1.18
|
%
|
|
|||
December 31, 2016
|
|
|
|
|
|
|
|
||||||
Allowance for Loan and Lease Losses
|
|
|
|
|
|
|
|
||||||
January 1
|
|
$
|
1,605
|
|
|
$
|
1,122
|
|
|
$
|
2,727
|
|
|
Charge-offs
|
|
(363
|
)
|
|
(523
|
)
|
|
(886
|
)
|
|
|||
Recoveries
|
|
178
|
|
|
165
|
|
|
343
|
|
|
|||
Net (charge-offs)
|
|
(185
|
)
|
|
(358
|
)
|
|
(543
|
)
|
|
|||
Provision for credit losses
|
|
153
|
|
|
280
|
|
|
433
|
|
|
|||
Net (increase) in allowance for unfunded loan commitments and letters of
credit
|
|
(39
|
)
|
|
(1
|
)
|
|
(40
|
)
|
|
|||
Other
|
|
|
|
|
12
|
|
|
12
|
|
|
|||
December 31
|
|
$
|
1,534
|
|
|
$
|
1,055
|
|
|
$
|
2,589
|
|
|
TDRs individually evaluated for impairment
|
|
$
|
45
|
|
|
$
|
226
|
|
|
$
|
271
|
|
|
Other loans individually evaluated for impairment
|
|
60
|
|
|
|
|
|
60
|
|
|
|||
Loans collectively evaluated for impairment
|
|
1,392
|
|
|
546
|
|
|
1,938
|
|
|
|||
Purchased impaired loans
|
|
37
|
|
|
283
|
|
|
320
|
|
|
|||
December 31
|
|
$
|
1,534
|
|
|
$
|
1,055
|
|
|
$
|
2,589
|
|
|
Loan Portfolio
|
|
|
|
|
|
|
|
||||||
TDRs individually evaluated for impairment
|
|
$
|
428
|
|
|
$
|
1,793
|
|
|
$
|
2,221
|
|
|
Other loans individually evaluated for impairment
|
|
371
|
|
|
|
|
|
371
|
|
|
|||
Loans collectively evaluated for impairment
|
|
137,047
|
|
|
67,345
|
|
|
204,392
|
|
|
|||
Fair value option loans (a)
|
|
|
|
|
893
|
|
|
893
|
|
|
|||
Purchased impaired loans
|
|
109
|
|
|
2,847
|
|
|
2,956
|
|
|
|||
December 31
|
|
$
|
137,955
|
|
|
$
|
72,878
|
|
|
$
|
210,833
|
|
|
Portfolio segment ALLL as a percentage of total ALLL
|
|
59
|
%
|
|
41
|
%
|
|
100
|
%
|
|
|||
Ratio of the allowance for loan and lease losses to total loans (b)
|
|
1.11
|
%
|
|
1.45
|
%
|
|
1.23
|
%
|
|
In millions
|
|
Commercial
Lending
|
|
|
Consumer
Lending
|
|
|
Total
|
|
|
|||
December 31, 2015
|
|
|
|
|
|
|
|
||||||
Allowance for Loan and Lease Losses
|
|
|
|
|
|
|
|
||||||
January 1
|
|
$
|
1,571
|
|
|
$
|
1,760
|
|
|
$
|
3,331
|
|
|
Charge-offs
|
|
(255
|
)
|
|
(550
|
)
|
|
(805
|
)
|
|
|||
Recoveries
|
|
240
|
|
|
179
|
|
|
419
|
|
|
|||
Net charge-offs
|
|
(15
|
)
|
|
(371
|
)
|
|
(386
|
)
|
|
|||
Provision for credit losses
|
|
55
|
|
|
200
|
|
|
255
|
|
|
|||
Net (increase) / decrease in allowance for unfunded loan commitments
and letters of credit
|
|
(3
|
)
|
|
1
|
|
|
(2
|
)
|
|
|||
Other (b)
|
|
(3
|
)
|
|
(468
|
)
|
|
(471
|
)
|
|
|||
December 31
|
|
$
|
1,605
|
|
|
$
|
1,122
|
|
|
$
|
2,727
|
|
|
TDRs individually evaluated for impairment
|
|
$
|
43
|
|
|
$
|
276
|
|
|
$
|
319
|
|
|
Other loans individually evaluated for impairment
|
|
76
|
|
|
|
|
76
|
|
|
||||
Loans collectively evaluated for impairment
|
|
1,437
|
|
|
585
|
|
|
2,022
|
|
|
|||
Purchased impaired loans
|
|
49
|
|
|
261
|
|
|
310
|
|
|
|||
December 31
|
|
$
|
1,605
|
|
|
$
|
1,122
|
|
|
$
|
2,727
|
|
|
Loan Portfolio
|
|
|
|
|
|
|
|
||||||
TDRs individually evaluated for impairment
|
|
$
|
434
|
|
|
$
|
1,917
|
|
|
$
|
2,351
|
|
|
Other loans individually evaluated for impairment
|
|
309
|
|
|
|
|
309
|
|
|
||||
Loans collectively evaluated for impairment
|
|
132,632
|
|
|
66,977
|
|
|
199,609
|
|
|
|||
Fair value option loans (a)
|
|
|
|
905
|
|
|
905
|
|
|
||||
Purchased impaired loans
|
|
169
|
|
|
3,353
|
|
|
3,522
|
|
|
|||
December 31
|
|
$
|
133,544
|
|
|
$
|
73,152
|
|
|
$
|
206,696
|
|
|
Portfolio segment ALLL as a percentage of total ALLL
|
|
59
|
%
|
|
41
|
%
|
|
100
|
%
|
|
|||
Ratio of the allowance for loan and lease losses to total loans
|
|
1.20
|
%
|
|
1.53
|
%
|
|
1.32
|
%
|
|
(a)
|
Loans accounted for under the fair value option are not evaluated for impairment as these loans are accounted for at fair value. Accordingly there is
no
allowance recorded on these loans.
|
(b)
|
Includes
$468 million
in write-offs of purchased impaired loans due to the change in derecognition policy effective
December 31, 2015
for certain consumer purchased impaired loans. See Note 1 Accounting Policies in our
2015
Form 10-K for additional information.
|
In millions
|
|
Amortized
Cost
|
|
|
Unrealized
|
|
Fair
Value
|
|
||||||||
Gains
|
|
|
Losses
|
|
|
|||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
||||||||
Securities Available for Sale
|
|
|
|
|
|
|
|
|
||||||||
Debt securities
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and government agencies
|
|
$
|
14,432
|
|
|
$
|
173
|
|
|
$
|
(84
|
)
|
|
$
|
14,521
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
25,534
|
|
|
121
|
|
|
(249
|
)
|
|
25,406
|
|
||||
Non-agency
|
|
2,443
|
|
|
336
|
|
|
(21
|
)
|
|
2,758
|
|
||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
1,960
|
|
|
2
|
|
|
(58
|
)
|
|
1,904
|
|
||||
Non-agency
|
|
2,603
|
|
|
19
|
|
|
(9
|
)
|
|
2,613
|
|
||||
Asset-backed
|
|
5,331
|
|
|
74
|
|
|
(8
|
)
|
|
5,397
|
|
||||
Other debt
|
|
4,322
|
|
|
129
|
|
|
(17
|
)
|
|
4,434
|
|
||||
Total debt securities
|
|
56,625
|
|
|
854
|
|
|
(446
|
)
|
|
57,033
|
|
||||
Other
|
|
587
|
|
|
|
|
(2
|
)
|
|
585
|
|
|||||
Total securities available for sale
|
|
$
|
57,212
|
|
|
$
|
854
|
|
|
$
|
(448
|
)
|
|
$
|
57,618
|
|
Securities Held to Maturity
|
|
|
|
|
|
|
|
|
||||||||
Debt securities
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and government agencies
|
|
$
|
741
|
|
|
$
|
37
|
|
|
$
|
(13
|
)
|
|
$
|
765
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
14,503
|
|
|
77
|
|
|
(139
|
)
|
|
14,441
|
|
||||
Non-agency
|
|
167
|
|
|
7
|
|
|
|
|
174
|
|
|||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
407
|
|
|
4
|
|
|
|
|
411
|
|
|||||
Non-agency
|
|
538
|
|
|
10
|
|
|
|
|
548
|
|
|||||
Asset-backed
|
|
200
|
|
|
1
|
|
|
|
|
|
201
|
|
||||
Other debt
|
|
1,957
|
|
|
88
|
|
|
(20
|
)
|
|
2,025
|
|
||||
Total securities held to maturity
|
|
$
|
18,513
|
|
|
$
|
224
|
|
|
$
|
(172
|
)
|
|
$
|
18,565
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
||||||||
Securities Available for Sale
|
|
|
|
|
|
|
|
|
||||||||
Debt securities
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and government agencies
|
|
$
|
13,100
|
|
|
$
|
151
|
|
|
$
|
(77
|
)
|
|
$
|
13,174
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
26,245
|
|
|
170
|
|
|
(287
|
)
|
|
26,128
|
|
||||
Non-agency
|
|
3,191
|
|
|
227
|
|
|
(52
|
)
|
|
3,366
|
|
||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
2,150
|
|
|
3
|
|
|
(34
|
)
|
|
2,119
|
|
||||
Non-agency
|
|
4,023
|
|
|
29
|
|
|
(27
|
)
|
|
4,025
|
|
||||
Asset-backed
|
|
5,938
|
|
|
52
|
|
|
(22
|
)
|
|
5,968
|
|
||||
Other debt
|
|
4,656
|
|
|
104
|
|
|
(37
|
)
|
|
4,723
|
|
||||
Total debt securities
|
|
59,303
|
|
|
736
|
|
|
(536
|
)
|
|
59,503
|
|
||||
Other
|
|
603
|
|
|
|
|
(2
|
)
|
|
601
|
|
|||||
Total securities available for sale
|
|
$
|
59,906
|
|
|
$
|
736
|
|
|
$
|
(538
|
)
|
|
$
|
60,104
|
|
Securities Held to Maturity
|
|
|
|
|
|
|
|
|
||||||||
Debt securities
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and government agencies
|
|
$
|
527
|
|
|
$
|
35
|
|
|
$
|
(22
|
)
|
|
$
|
540
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
11,074
|
|
|
68
|
|
|
(161
|
)
|
|
10,981
|
|
||||
Non-agency
|
|
191
|
|
|
7
|
|
|
|
|
198
|
|
|||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
||||||||
Agency
|
|
903
|
|
|
24
|
|
|
|
|
927
|
|
|||||
Non-agency
|
|
567
|
|
|
10
|
|
|
|
|
577
|
|
|||||
Asset-backed
|
|
558
|
|
|
|
|
(2
|
)
|
|
556
|
|
|||||
Other debt
|
|
2,023
|
|
|
76
|
|
|
(12
|
)
|
|
2,087
|
|
||||
Total securities held to maturity
|
|
$
|
15,843
|
|
|
$
|
220
|
|
|
$
|
(197
|
)
|
|
$
|
15,866
|
|
In millions
|
|
Unrealized loss position
less than 12 months
|
|
Unrealized loss position
12 months or more
|
|
Total
|
||||||||||||||||||
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securities Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and government agencies
|
|
$
|
(42
|
)
|
|
$
|
6,099
|
|
|
$
|
(42
|
)
|
|
$
|
1,465
|
|
|
$
|
(84
|
)
|
|
$
|
7,564
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
(47
|
)
|
|
8,151
|
|
|
(202
|
)
|
|
9,954
|
|
|
(249
|
)
|
|
18,105
|
|
||||||
Non-agency
|
|
|
|
|
|
|
|
(21
|
)
|
|
383
|
|
|
(21
|
)
|
|
383
|
|
||||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
(11
|
)
|
|
524
|
|
|
(47
|
)
|
|
1,302
|
|
|
(58
|
)
|
|
1,826
|
|
||||||
Non-agency
|
|
(3
|
)
|
|
400
|
|
|
(6
|
)
|
|
333
|
|
|
(9
|
)
|
|
733
|
|
||||||
Asset-backed
|
|
(4
|
)
|
|
1,697
|
|
|
(4
|
)
|
|
462
|
|
|
(8
|
)
|
|
2,159
|
|
||||||
Other debt
|
|
(3
|
)
|
|
966
|
|
|
(14
|
)
|
|
798
|
|
|
(17
|
)
|
|
1,764
|
|
||||||
Total debt securities available for sale
|
|
$
|
(110
|
)
|
|
$
|
17,837
|
|
|
$
|
(336
|
)
|
|
$
|
14,697
|
|
|
$
|
(446
|
)
|
|
$
|
32,534
|
|
Securities Held to Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and government agencies
|
|
$
|
(3
|
)
|
|
$
|
195
|
|
|
$
|
(10
|
)
|
|
$
|
255
|
|
|
$
|
(13
|
)
|
|
$
|
450
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
(10
|
)
|
|
3,167
|
|
|
(129
|
)
|
|
6,168
|
|
|
(139
|
)
|
|
9,335
|
|
||||||
Other debt
|
|
(12
|
)
|
|
83
|
|
|
(8
|
)
|
|
67
|
|
|
(20
|
)
|
|
150
|
|
||||||
Total debt securities held to maturity
|
|
$
|
(25
|
)
|
|
$
|
3,445
|
|
|
$
|
(147
|
)
|
|
$
|
6,490
|
|
|
$
|
(172
|
)
|
|
$
|
9,935
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securities Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and government agencies
|
|
$
|
(57
|
)
|
|
$
|
3,108
|
|
|
$
|
(20
|
)
|
|
$
|
2,028
|
|
|
$
|
(77
|
)
|
|
$
|
5,136
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
(267
|
)
|
|
16,942
|
|
|
(20
|
)
|
|
922
|
|
|
(287
|
)
|
|
17,864
|
|
||||||
Non-agency
|
|
(1
|
)
|
|
109
|
|
|
(51
|
)
|
|
1,119
|
|
|
(52
|
)
|
|
1,228
|
|
||||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
(33
|
)
|
|
1,577
|
|
|
(1
|
)
|
|
86
|
|
|
(34
|
)
|
|
1,663
|
|
||||||
Non-agency
|
|
(14
|
)
|
|
880
|
|
|
(13
|
)
|
|
987
|
|
|
(27
|
)
|
|
1,867
|
|
||||||
Asset-backed
|
|
(5
|
)
|
|
1,317
|
|
|
(17
|
)
|
|
902
|
|
|
(22
|
)
|
|
2,219
|
|
||||||
Other debt
|
|
(33
|
)
|
|
1,827
|
|
|
(4
|
)
|
|
243
|
|
|
(37
|
)
|
|
2,070
|
|
||||||
Total debt securities available for sale
|
|
$
|
(410
|
)
|
|
$
|
25,760
|
|
|
$
|
(126
|
)
|
|
$
|
6,287
|
|
|
$
|
(536
|
)
|
|
$
|
32,047
|
|
Securities Held to Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and government agencies
|
|
$
|
(22
|
)
|
|
$
|
238
|
|
|
|
|
|
|
$
|
(22
|
)
|
|
$
|
238
|
|
||||
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
(153
|
)
|
|
8,041
|
|
|
$
|
(8
|
)
|
|
$
|
161
|
|
|
(161
|
)
|
|
8,202
|
|
||||
Asset-backed
|
|
|
|
|
|
|
|
(2
|
)
|
|
451
|
|
|
(2
|
)
|
|
451
|
|
||||||
Other debt
|
|
(12
|
)
|
|
146
|
|
|
|
|
1
|
|
|
(12
|
)
|
|
147
|
|
|||||||
Total debt securities held to maturity
|
|
$
|
(187
|
)
|
|
$
|
8,425
|
|
|
$
|
(10
|
)
|
|
$
|
613
|
|
|
$
|
(197
|
)
|
|
$
|
9,038
|
|
In millions
|
Proceeds
|
|
Gross
Gains
|
|
Gross
Losses
|
|
Net
Gains
|
|
Tax
Expense
|
|
|||||
Year ended December 31
|
|
|
|
|
|
||||||||||
2017
|
$
|
5,722
|
|
$
|
38
|
|
$
|
(31
|
)
|
$
|
7
|
|
$
|
2
|
|
2016
|
$
|
3,489
|
|
$
|
24
|
|
$
|
(8
|
)
|
$
|
16
|
|
$
|
6
|
|
2015
|
$
|
6,829
|
|
$
|
56
|
|
$
|
(13
|
)
|
$
|
43
|
|
$
|
15
|
|
December 31, 2017
|
|
1 Year or
Less |
|
|
After 1 Year
through 5
Years
|
|
|
After 5 Years
through 10 Years
|
|
|
After 10
Years
|
|
|
Total
|
|
|||||
Dollars in millions
|
|
|
|
|
|
|||||||||||||||
Securities Available for Sale
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury and government agencies
|
|
$
|
85
|
|
|
$
|
8,780
|
|
|
$
|
4,449
|
|
|
$
|
1,118
|
|
|
$
|
14,432
|
|
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
|
3
|
|
|
45
|
|
|
561
|
|
|
24,925
|
|
|
25,534
|
|
|||||
Non-agency
|
|
|
|
|
|
|
|
2,443
|
|
|
2,443
|
|
||||||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
|
2
|
|
|
259
|
|
|
624
|
|
|
1,075
|
|
|
1,960
|
|
|||||
Non-agency
|
|
|
|
|
|
|
451
|
|
|
2,152
|
|
|
2,603
|
|
||||||
Asset-backed
|
|
13
|
|
|
1,846
|
|
|
1,897
|
|
|
1,575
|
|
|
5,331
|
|
|||||
Other debt
|
|
521
|
|
|
2,032
|
|
|
670
|
|
|
1,099
|
|
|
4,322
|
|
|||||
Total debt securities available for sale
|
|
$
|
624
|
|
|
$
|
12,962
|
|
|
$
|
8,652
|
|
|
$
|
34,387
|
|
|
$
|
56,625
|
|
Fair value
|
|
$
|
626
|
|
|
$
|
12,958
|
|
|
$
|
8,695
|
|
|
$
|
34,754
|
|
|
$
|
57,033
|
|
Weighted-average yield, GAAP basis
|
|
2.73
|
%
|
|
2.12
|
%
|
|
2.29
|
%
|
|
2.97
|
%
|
|
2.67
|
%
|
|||||
Securities Held to Maturity
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury and government agencies
|
|
|
|
|
|
$
|
377
|
|
|
$
|
364
|
|
|
$
|
741
|
|
||||
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
|
|
|
$
|
67
|
|
|
346
|
|
|
14,090
|
|
|
14,503
|
|
|||||
Non-agency
|
|
|
|
|
|
|
|
167
|
|
|
167
|
|
||||||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
|
$
|
172
|
|
|
177
|
|
|
4
|
|
|
54
|
|
|
407
|
|
||||
Non-agency
|
|
|
|
|
|
|
|
538
|
|
|
538
|
|
||||||||
Asset-backed
|
|
|
|
|
|
|
114
|
|
|
86
|
|
|
200
|
|
||||||
Other debt
|
|
49
|
|
|
394
|
|
|
854
|
|
|
660
|
|
|
1,957
|
|
|||||
Total debt securities held to maturity
|
|
$
|
221
|
|
|
$
|
638
|
|
|
$
|
1,695
|
|
|
$
|
15,959
|
|
|
$
|
18,513
|
|
Fair value
|
|
$
|
221
|
|
|
$
|
654
|
|
|
$
|
1,751
|
|
|
$
|
15,939
|
|
|
$
|
18,565
|
|
Weighted-average yield, GAAP basis
|
|
3.58
|
%
|
|
3.92
|
%
|
|
3.44
|
%
|
|
3.21
|
%
|
|
3.26
|
%
|
In millions
|
December 31
2017 |
|
|
December 31
2016 |
|
||
Pledged to others
|
$
|
8,175
|
|
|
$
|
9,493
|
|
Accepted from others:
|
|
|
|
||||
Permitted by contract or custom to sell
or repledge
|
$
|
1,152
|
|
|
$
|
912
|
|
Permitted amount repledged to others
|
$
|
1,097
|
|
|
$
|
799
|
|
•
|
Level 1:
Fair value is determined using a quoted price in an active market for identical assets or liabilities. Level 1 assets and liabilities may include debt securities, equity securities and listed derivative contracts that are traded in an active exchange market and certain U.S. Treasury securities that are actively traded in over-the-counter markets.
|
•
|
Level 2:
Fair value is estimated using inputs other than quoted prices included within Level 1 that are observable for assets or liabilities, either directly or indirectly. The majority of Level 2 assets and liabilities include debt securities, equity securities and listed derivative contracts with quoted prices that are traded in markets that are not active, and certain debt and equity securities and over-the-counter derivative contracts whose fair value is determined using a pricing model without significant unobservable inputs.
|
•
|
Level 3:
Fair value is estimated using unobservable inputs that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models and discounted cash flow methodologies, or similar techniques for which the significant valuation inputs are not observable and the determination of fair value requires significant management judgment or estimation.
|
|
December 31, 2017
|
|
|
December 31, 2016
|
|
||||||||||||||||||||||||||||
In millions
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
Fair Value
|
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
Fair Value
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Residential mortgage loans held for sale
|
|
|
$
|
829
|
|
|
$
|
3
|
|
|
$
|
832
|
|
|
|
|
|
$
|
1,008
|
|
|
$
|
2
|
|
|
$
|
1,010
|
|
|
||||
Commercial mortgage loans held for sale
|
|
|
723
|
|
|
107
|
|
|
830
|
|
|
|
|
|
|
|
1,400
|
|
|
1,400
|
|
|
|||||||||||
Securities available for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. Treasury and government agencies
|
$
|
14,088
|
|
|
433
|
|
|
|
|
14,521
|
|
|
|
$
|
12,572
|
|
|
602
|
|
|
|
|
13,174
|
|
|
||||||||
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Agency
|
|
|
25,406
|
|
|
|
|
25,406
|
|
|
|
|
|
26,128
|
|
|
|
|
26,128
|
|
|
||||||||||||
Non-agency
|
|
|
97
|
|
|
2,661
|
|
|
2,758
|
|
|
|
|
|
112
|
|
|
3,254
|
|
|
3,366
|
|
|
||||||||||
Commercial mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Agency
|
|
|
1,904
|
|
|
|
|
1,904
|
|
|
|
|
|
2,119
|
|
|
|
|
2,119
|
|
|
||||||||||||
Non-agency
|
|
|
2,613
|
|
|
|
|
2,613
|
|
|
|
|
|
4,025
|
|
|
|
|
4,025
|
|
|
||||||||||||
Asset-backed
|
|
|
5,065
|
|
|
332
|
|
|
5,397
|
|
|
|
|
|
5,565
|
|
|
403
|
|
|
5,968
|
|
|
||||||||||
Other debt
|
|
|
4,347
|
|
|
87
|
|
|
4,434
|
|
|
|
|
|
4,657
|
|
|
66
|
|
|
4,723
|
|
|
||||||||||
Total debt securities
|
14,088
|
|
|
39,865
|
|
|
3,080
|
|
|
57,033
|
|
|
|
12,572
|
|
|
43,208
|
|
|
3,723
|
|
|
59,503
|
|
|
||||||||
Other
|
524
|
|
|
61
|
|
|
|
|
585
|
|
|
|
541
|
|
|
60
|
|
|
|
|
601
|
|
|
||||||||||
Total securities available for sale
|
14,612
|
|
|
39,926
|
|
|
3,080
|
|
|
57,618
|
|
|
|
13,113
|
|
|
43,268
|
|
|
3,723
|
|
|
60,104
|
|
|
||||||||
Loans
|
|
|
571
|
|
|
298
|
|
|
869
|
|
|
|
|
|
558
|
|
|
335
|
|
|
893
|
|
|
||||||||||
Equity investments (a)
|
|
|
|
|
1,036
|
|
|
1,265
|
|
|
|
|
|
|
|
1,331
|
|
|
1,381
|
|
|
||||||||||||
Residential mortgage servicing rights
|
|
|
|
|
1,164
|
|
|
1,164
|
|
|
|
|
|
|
|
1,182
|
|
|
1,182
|
|
|
||||||||||||
Commercial mortgage servicing rights
|
|
|
|
|
668
|
|
|
668
|
|
|
|
|
|
|
|
576
|
|
|
576
|
|
|
||||||||||||
Trading securities (b)
|
1,243
|
|
|
1,670
|
|
|
2
|
|
|
2,915
|
|
|
|
1,458
|
|
|
1,169
|
|
|
2
|
|
|
2,629
|
|
|
||||||||
Financial derivatives (b) (c)
|
|
|
|
2,864
|
|
|
10
|
|
|
2,874
|
|
|
|
10
|
|
|
4,566
|
|
|
40
|
|
|
4,616
|
|
|
||||||||
Other assets
|
278
|
|
|
253
|
|
|
107
|
|
|
638
|
|
|
|
266
|
|
|
312
|
|
|
239
|
|
|
817
|
|
|
||||||||
Total assets
|
$
|
16,133
|
|
|
$
|
46,836
|
|
|
$
|
6,475
|
|
|
$
|
69,673
|
|
|
|
$
|
14,847
|
|
|
$
|
50,881
|
|
|
$
|
8,830
|
|
|
$
|
74,608
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other borrowed funds
|
$
|
1,079
|
|
|
$
|
254
|
|
|
$
|
11
|
|
|
$
|
1,344
|
|
|
|
$
|
799
|
|
|
$
|
161
|
|
|
$
|
10
|
|
|
$
|
970
|
|
|
Financial derivatives (c) (d)
|
|
|
2,369
|
|
|
487
|
|
|
2,856
|
|
|
|
1
|
|
|
3,424
|
|
|
414
|
|
|
3,839
|
|
|
|||||||||
Other liabilities
|
|
|
|
|
33
|
|
|
33
|
|
|
|
|
|
|
|
9
|
|
|
9
|
|
|
||||||||||||
Total liabilities
|
$
|
1,079
|
|
|
$
|
2,623
|
|
|
$
|
531
|
|
|
$
|
4,233
|
|
|
|
$
|
800
|
|
|
$
|
3,585
|
|
|
$
|
433
|
|
|
$
|
4,818
|
|
|
(a)
|
Certain investments that are measured at fair value using the NAV per share (or its equivalent) practical expedient 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.
|
(b)
|
Included in Other assets on the Consolidated Balance Sheet.
|
(c)
|
Amounts at
December 31, 2017
and
December 31, 2016
, are presented gross and are not reduced by the impact of legally enforceable master netting agreements that allow us to net positive and negative positions and cash collateral held or placed with the same counterparty. See Note
13
Financial Derivatives
for additional information related to derivative offsetting.
|
(d)
|
Included in Other liabilities on the Consolidated Balance Sheet.
|
|
|
Total realized / unrealized
gains or losses for the period (a) |
|
|
|
|
|
|
|
|
Unrealized
gains / losses on assets and liabilities held on Consolidated Balance Sheet at Dec. 31, 2017 (a) (b) |
|||||||||||||||||||||||||
Level 3 Instruments Only
In millions |
Fair
Value Dec. 31, 2016 |
|
Included in
Earnings |
|
Included
in Other comprehensive income |
|
Purchases
|
|
Sales
|
|
Issuances
|
|
Settlements
|
|
Transfers
into Level 3 |
|
Transfers
out of Level 3 |
|
|
Fair
Value Dec. 31, 2017 |
|
|||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Residential mortgage loans
held for sale |
$
|
2
|
|
|
|
|
$
|
8
|
|
$
|
(1
|
)
|
|
|
$
|
10
|
|
$
|
(16
|
)
|
(c)
|
$
|
3
|
|
|
|
||||||||||
Commercial mortgage
loans held for sale |
1,400
|
|
$
|
81
|
|
|
|
|
(5,278
|
)
|
$
|
4,885
|
|
$
|
(258
|
)
|
|
(723
|
)
|
(d)
|
107
|
|
$
|
4
|
|
|
||||||||||
Securities available for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Residential mortgage-
backed non-agency |
3,254
|
|
77
|
|
|
$
|
137
|
|
|
(33
|
)
|
|
(774
|
)
|
|
|
|
2,661
|
|
(1
|
)
|
|
||||||||||||||
Commercial mortgage-
backed non-agency |
|
12
|
|
|
|
|
(12
|
)
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Asset-backed
|
403
|
|
12
|
|
|
22
|
|
|
(25
|
)
|
|
(80
|
)
|
|
|
|
332
|
|
|
|
||||||||||||||||
Other debt
|
66
|
|
|
|
19
|
|
13
|
|
(1
|
)
|
|
(10
|
)
|
|
|
|
|
|
87
|
|
|
|
||||||||||||||
Total securities
available for sale |
3,723
|
|
101
|
|
|
178
|
|
13
|
|
(71
|
)
|
|
|
(864
|
)
|
|
|
|
|
|
3,080
|
|
(1
|
)
|
|
|||||||||||
Loans
|
335
|
|
|
|
|
|
97
|
|
(28
|
)
|
|
(68
|
)
|
13
|
|
(51
|
)
|
(c)
|
298
|
|
(7
|
)
|
|
|||||||||||||
Equity investments
|
1,331
|
|
239
|
|
|
|
214
|
|
(565
|
)
|
|
|
|
(183
|
)
|
(e)
|
1,036
|
|
145
|
|
|
|||||||||||||||
Residential mortgage
servicing rights |
1,182
|
|
(83
|
)
|
|
|
185
|
|
|
55
|
|
(175
|
)
|
|
|
|
1,164
|
|
(79
|
)
|
|
|||||||||||||||
Commercial mortgage
servicing rights |
576
|
|
46
|
|
|
|
69
|
|
|
88
|
|
(111
|
)
|
|
|
|
668
|
|
45
|
|
|
|||||||||||||||
Trading securities
|
2
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
||||||||||||||||||||
Financial derivatives
|
40
|
|
39
|
|
|
|
3
|
|
|
|
(67
|
)
|
|
(5
|
)
|
|
10
|
|
67
|
|
|
|||||||||||||||
Other assets
|
239
|
|
23
|
|
|
|
|
|
|
(155
|
)
|
|
|
|
107
|
|
24
|
|
|
|||||||||||||||||
Total assets
|
$
|
8,830
|
|
$
|
446
|
|
|
$
|
178
|
|
$
|
589
|
|
$
|
(5,943
|
)
|
$
|
5,028
|
|
$
|
(1,698
|
)
|
$
|
23
|
|
$
|
(978
|
)
|
|
$
|
6,475
|
|
$
|
198
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Other borrowed funds
|
$
|
10
|
|
|
|
|
|
|
$
|
72
|
|
$
|
(71
|
)
|
|
|
|
$
|
11
|
|
|
|
||||||||||||||
Financial derivatives
|
414
|
|
$
|
293
|
|
|
|
|
$
|
3
|
|
|
(221
|
)
|
|
$
|
(2
|
)
|
|
487
|
|
$
|
297
|
|
|
|||||||||||
Other liabilities
|
9
|
|
25
|
|
|
|
|
|
173
|
|
(174
|
)
|
|
|
|
33
|
|
26
|
|
|
||||||||||||||||
Total liabilities
|
$
|
433
|
|
$
|
318
|
|
|
|
|
|
|
$
|
3
|
|
$
|
245
|
|
$
|
(466
|
)
|
|
|
$
|
(2
|
)
|
|
$
|
531
|
|
$
|
323
|
|
|
|||
Net gains (losses)
|
|
|
$
|
128
|
|
(f)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(125
|
)
|
(g)
|
|
|
Total realized / unrealized
gains or losses for the period (a) |
|
|
|
|
|
|
|
|
|
Unrealized
gains / losses on assets and liabilities held on Consolidated Balance Sheet at Dec. 31, 2016 (a) (b) |
|||||||||||||||||||||||||
Level 3 Instruments Only
In millions |
Fair Value Dec. 31, 2015
|
|
Included in
Earnings |
|
Included
in Other comprehensive income |
|
Purchases
|
|
Sales
|
|
Issuances
|
|
Settlements
|
|
Transfers
into Level 3 |
|
|
Transfers
out of Level 3 |
|
(c)
|
Fair Value Dec. 31, 2016
|
|
|||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Residential mortgage loans
held for sale |
$
|
5
|
|
|
|
|
$
|
10
|
|
$
|
(3
|
)
|
|
|
$
|
10
|
|
|
$
|
(20
|
)
|
|
$
|
2
|
|
|
|
||||||||||
Commercial mortgage
loans held for sale |
641
|
|
$
|
79
|
|
|
|
|
(3,810
|
)
|
$
|
4,515
|
|
$
|
(25
|
)
|
|
|
|
|
1,400
|
|
$
|
(3
|
)
|
|
|||||||||||
Securities available for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Residential mortgage-
backed non-agency |
4,008
|
|
75
|
|
|
$
|
16
|
|
|
(60
|
)
|
|
(785
|
)
|
|
|
|
|
3,254
|
|
(2
|
)
|
|
||||||||||||||
Asset-backed
|
482
|
|
13
|
|
|
(3
|
)
|
|
|
|
(89
|
)
|
|
|
|
|
403
|
|
|
|
|||||||||||||||||
Other debt
|
45
|
|
1
|
|
|
28
|
|
12
|
|
(17
|
)
|
|
(3
|
)
|
2
|
|
|
(2
|
)
|
|
66
|
|
|
|
|||||||||||||
Total securities
available for sale |
4,535
|
|
89
|
|
|
41
|
|
12
|
|
(77
|
)
|
|
|
(877
|
)
|
2
|
|
|
(2
|
)
|
|
3,723
|
|
(2
|
)
|
|
|||||||||||
Loans
|
340
|
|
8
|
|
|
|
126
|
|
(22
|
)
|
|
(78
|
)
|
15
|
|
|
(54
|
)
|
|
335
|
|
2
|
|
|
|||||||||||||
Equity investments
|
1,098
|
|
148
|
|
|
|
269
|
|
(418
|
)
|
|
|
235
|
|
(e)
|
(1
|
)
|
|
1,331
|
|
127
|
|
|
||||||||||||||
Residential mortgage
servicing rights |
1,063
|
|
37
|
|
|
|
188
|
|
|
62
|
|
(168
|
)
|
|
|
|
|
1,182
|
|
39
|
|
|
|||||||||||||||
Commercial mortgage
servicing rights |
526
|
|
45
|
|
|
|
36
|
|
|
61
|
|
(92
|
)
|
|
|
|
|
576
|
|
45
|
|
|
|||||||||||||||
Trading securities
|
3
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
2
|
|
|
|
|||||||||||||||||||
Financial derivatives
|
31
|
|
115
|
|
|
|
2
|
|
|
|
(108
|
)
|
|
|
|
|
40
|
|
102
|
|
|
||||||||||||||||
Other assets
|
364
|
|
15
|
|
|
(2
|
)
|
|
|
|
|
(138
|
)
|
|
|
|
|
239
|
|
13
|
|
|
|||||||||||||||
Total assets
|
$
|
8,606
|
|
$
|
536
|
|
|
$
|
39
|
|
$
|
643
|
|
$
|
(4,330
|
)
|
$
|
4,638
|
|
$
|
(1,487
|
)
|
$
|
262
|
|
|
$
|
(77
|
)
|
|
$
|
8,830
|
|
$
|
323
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Other borrowed funds
|
$
|
12
|
|
|
|
|
|
|
$
|
87
|
|
$
|
(89
|
)
|
|
|
|
|
$
|
10
|
|
|
|
||||||||||||||
Financial derivatives
|
473
|
|
$
|
127
|
|
|
|
|
$
|
4
|
|
|
(190
|
)
|
|
|
|
|
414
|
|
$
|
129
|
|
|
|||||||||||||
Other liabilities
|
10
|
|
(9
|
)
|
|
|
|
|
132
|
|
(124
|
)
|
|
|
|
|
9
|
|
|
|
|||||||||||||||||
Total liabilities
|
$
|
495
|
|
$
|
118
|
|
|
|
|
|
|
$
|
4
|
|
$
|
219
|
|
$
|
(403
|
)
|
|
|
|
|
|
|
$
|
433
|
|
$
|
129
|
|
|
||||
Net gains (losses)
|
|
|
$
|
418
|
|
(f)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
194
|
|
(g)
|
(a)
|
Losses for assets are bracketed while losses for liabilities are not.
|
(b)
|
The amount of the total gains or losses for the period included in earnings that is attributable to the change in unrealized gains or losses related to those assets and liabilities held at the end of the reporting period.
|
(c)
|
Transfers out of Level 3 primarily reflect the reclassification of residential mortgage loans held for sale to held for investment and the transfer of residential mortgage loans to OREO.
|
(d)
|
Reflects a transfer from Level 3 to Level 2 due to an unobservable valuation input that was deemed to be not significant.
|
(e)
|
Reflects transfers into and out of Level 3 associated with changes in valuation methodology for certain equity investments subject to the Volcker Rule provisions of the Dodd-Frank Act.
|
(f)
|
Net gains (losses) realized and unrealized included in earnings related to Level 3 assets and liabilities included amortization and accretion. The amortization and accretion amounts were included in Interest income on the Consolidated Income Statement and the remaining net gains (losses) realized and unrealized were included in Noninterest income on the Consolidated Income Statement.
|
(g)
|
Net unrealized gains (losses) related to assets and liabilities held at the end of the reporting period were included in Noninterest income on the Consolidated Income Statement.
|
Level 3 Instruments Only
Dollars in millions
|
Fair Value
|
Valuation Techniques
|
Unobservable Inputs
|
Range (Weighted Average)
|
||
Commercial mortgage loans held for sale
|
$
|
107
|
|
Discounted cash flow
|
Spread over the benchmark curve (a)
|
525bps - 1,470bps
(1,020bps)
|
Residential mortgage-backed
non-agency securities |
2,661
|
|
Priced by a third-party vendor using a discounted cash flow pricing model
|
Constant prepayment rate (CPR)
|
1.0% - 31.6% (10.8%
)
|
|
Constant default rate (CDR)
|
0.1% - 18.8% (5.4%)
|
|||||
Loss severity
|
15.0% - 100.0% (51.5%
)
|
|||||
Spread over the benchmark curve (a)
|
190bps weighted average
|
|||||
Asset-backed securities
|
332
|
|
Priced by a third-party vendor using a discounted cash flow pricing model
|
Constant prepayment rate (CPR)
|
1.0% - 19.0% (7.9%)
|
|
Constant default rate (CDR)
|
2.0% - 11.8% (5.4%)
|
|||||
Loss severity
|
15.0% - 100.0% (68.5%)
|
|||||
Spread over the benchmark curve (a)
|
179bps weighted average
|
|||||
Loans
|
133
|
|
Consensus pricing (b)
|
Cumulative default rate
|
11.0% - 100.0% (85.7%)
|
|
Loss severity
|
0.0% - 100.0% (20.6%)
|
|||||
Discount rate
|
5.5% - 8.0% (5.7%)
|
|||||
|
104
|
|
Discounted cash flow
|
Loss severity
|
8.0% weighted average
|
|
Discount rate
|
4.9% weighted average
|
|||||
|
61
|
|
Consensus pricing (b)
|
Credit and Liquidity discount
|
0.0% - 99.0% (61.1%)
|
|
Equity investments
|
1,036
|
|
Multiple of adjusted earnings
|
Multiple of earnings
|
4.5x - 29.7x (8.3x)
|
|
Residential mortgage servicing rights
|
1,164
|
|
Discounted cash flow
|
Constant prepayment rate (CPR)
|
0.0% - 36.7% (10.0%)
|
|
Spread over the benchmark curve (a)
|
390bps - 1,839bps (830bps)
|
|||||
Commercial mortgage servicing rights
|
668
|
|
Discounted cash flow
|
Constant prepayment rate (CPR)
|
7.7% - 14.2% (8.5%)
|
|
Discount rate
|
6.4% - 7.9% (7.8%)
|
|||||
Financial derivatives - Swaps related to
sales of certain Visa Class B common shares |
(380
|
)
|
Discounted cash flow
|
Estimated conversion factor of Visa
Class B shares into Class A shares |
163.8% weighted average
|
|
Estimated growth rate of Visa
Class A share price |
16.0%
|
|||||
Estimated length of litigation
resolution date |
Q2 2021
|
|||||
Insignificant Level 3 assets, net of
liabilities (c) |
58
|
|
|
|
|
|
Total Level 3 assets, net of liabilities (d)
|
$
|
5,944
|
|
|
|
|
Level 3 Instruments Only
Dollars in millions
|
Fair Value
|
Valuation Techniques
|
Unobservable Inputs
|
Range (Weighted Average)
|
||
Commercial mortgage loans held for sale
|
$
|
1,400
|
|
Discounted cash flow
|
Spread over the benchmark curve (a)
|
42bps - 1,725bps (362bps)
|
Estimated servicing cash flows
|
0.0% - 7.3% (1.5%)
|
|||||
Residential mortgage-backed
non-agency securities |
3,254
|
|
Priced by a third-party vendor using a discounted cash flow pricing model
|
Constant prepayment rate (CPR)
|
1.0% - 24.2% (7.2%)
|
|
Constant default rate (CDR)
|
0.0% - 16.7% (5.3%)
|
|||||
Loss severity
|
10.0% - 98.5% (53.5%)
|
|||||
Spread over the benchmark curve (a)
|
236bps weighted average
|
|||||
Asset-backed securities
|
403
|
|
Priced by a third-party vendor using a discounted cash flow pricing model
|
Constant prepayment rate (CPR)
|
1.0% - 16.0% (6.4%)
|
|
Constant default rate (CDR)
|
2.0% - 13.9% (6.6%)
|
|||||
Loss severity
|
24.2% - 100.0% (77.3%)
|
|||||
Spread over the benchmark curve (a)
|
278bps weighted average
|
|||||
Loans
|
141
|
|
Consensus pricing (b)
|
Cumulative default rate
|
11.0% - 100.0% (86.9%)
|
|
Loss severity
|
0.0% - 100.0% (22.9%)
|
|||||
Discount rate
|
4.7% - 6.7% (5.1%)
|
|||||
|
116
|
|
Discounted cash flow
|
Loss severity
|
8.0% weighted average
|
|
Discount rate
|
4.2% weighted average
|
|||||
|
78
|
|
Consensus pricing (b)
|
Credit and Liquidity discount
|
0.0% - 99.0% (57.9%)
|
|
Equity investments
|
1,331
|
|
Multiple of adjusted earnings
|
Multiple of earnings
|
4.5x - 12.0x (7.8x)
|
|
Consensus pricing (b)
|
Liquidity discount
|
0.0% - 40.0%
|
||||
Residential mortgage servicing rights
|
1,182
|
|
Discounted cash flow
|
Constant prepayment rate (CPR)
|
0.0% - 36.0% (9.4%)
|
|
Spread over the benchmark curve (a)
|
341bps - 1,913bps (850bps)
|
|||||
Commercial mortgage servicing rights
|
576
|
|
Discounted cash flow
|
Constant prepayment rate (CPR)
|
7.5% - 43.4% (8.6%)
|
|
Discount rate
|
3.5% - 7.6% (7.5%)
|
|||||
Other assets – BlackRock Series C
Preferred Stock |
232
|
|
Consensus pricing (b)
|
Liquidity discount
|
15.0% - 25.0% (20.0%)
|
|
Financial derivatives - BlackRock LTIP
|
(232
|
)
|
Consensus pricing (b)
|
Liquidity discount
|
15.0% - 25.0% (20.0%)
|
|
Financial derivatives - Swaps related to
sales of certain Visa Class B common shares |
(164
|
)
|
Discounted cash flow
|
Estimated conversion factor of Class B shares into Class A shares
|
164.4% weighted average
|
|
Estimated growth rate of Visa Class
A share price |
14.0%
|
|||||
Estimated length of litigation
resolution date |
Q2 2019
|
|||||
Insignificant Level 3 assets, net of
liabilities (c) |
80
|
|
|
|
|
|
Total Level 3 assets, net of liabilities (d)
|
$
|
8,397
|
|
|
|
|
(a)
|
The assumed yield spread over the benchmark curve for each instrument is generally intended to incorporate non-interest-rate risks, such as credit and liquidity risks.
|
(b)
|
Consensus pricing refers to fair value estimates that are generally internally developed using information such as dealer quotes or other third-party provided valuations or comparable asset prices.
|
(c)
|
Represents the aggregate amount of Level 3 assets and liabilities measured at fair value on a recurring basis that are individually and in the aggregate insignificant. The amount includes certain financial derivative assets and liabilities, trading securities, state and municipal and other debt securities, residential mortgage loans held for sale, other assets, other borrowed funds and other liabilities.
|
(d)
|
Consisted of total Level 3 assets of
$6.4 billion
and total Level 3 liabilities of
$.5 billion
as of
December 31, 2017
and
$8.8 billion
and
$.4 billion
as of
December 31, 2016
, respectively.
|
|
Fair Value
|
|
||||||
In millions
|
December 31
2017 |
|
|
December 31
2016 |
|
|
||
Assets (a)
|
|
|
|
|
||||
Nonaccrual loans
|
$
|
100
|
|
|
$
|
187
|
|
|
OREO, foreclosed and other assets
|
70
|
|
|
107
|
|
|
||
Long-lived assets
|
80
|
|
|
18
|
|
|
||
Total assets
|
$
|
250
|
|
|
$
|
312
|
|
|
Year ended December 31
In millions
|
Gains (Losses)
|
|
||||||||||
2017
|
|
|
2016
|
|
|
2015
|
|
|
||||
Assets (a)
|
|
|
|
|
|
|
||||||
Nonaccrual loans
|
$
|
(8
|
)
|
|
$
|
(106
|
)
|
|
$
|
(44
|
)
|
|
OREO, foreclosed and other assets
|
(10
|
)
|
|
(16
|
)
|
|
(18
|
)
|
|
|||
Long-lived assets
|
(168
|
)
|
|
(15
|
)
|
|
(20
|
)
|
|
|||
Total assets
|
$
|
(186
|
)
|
|
$
|
(137
|
)
|
|
$
|
(82
|
)
|
|
(a)
|
All Level 3 for the periods presented.
|
(a)
|
Additional quantitative information for the unobservable inputs was not meaningful for the periods presented.
|
In millions
|
Fair Value
|
|
|
Aggregate Unpaid
Principal Balance
|
|
|
Difference
|
|
|
|||
December 31, 2017
|
|
|
|
|
|
|
||||||
Assets
|
|
|
|
|
|
|
||||||
Residential mortgage loans held for sale
|
|
|
|
|
|
|
||||||
Performing loans
|
$
|
822
|
|
|
$
|
796
|
|
|
$
|
26
|
|
|
Accruing loans 90 days or more past due
|
3
|
|
|
3
|
|
|
|
|
||||
Nonaccrual loans
|
7
|
|
|
8
|
|
|
(1
|
)
|
|
|||
Total
|
$
|
832
|
|
|
$
|
807
|
|
|
$
|
25
|
|
|
Commercial mortgage loans held for sale (a)
|
|
|
|
|
|
|
||||||
Performing loans
|
$
|
828
|
|
|
$
|
842
|
|
|
$
|
(14
|
)
|
|
Nonaccrual loans
|
2
|
|
|
3
|
|
|
(1
|
)
|
|
|||
Total
|
$
|
830
|
|
|
$
|
845
|
|
|
$
|
(15
|
)
|
|
Residential mortgage loans
|
|
|
|
|
|
|
||||||
Performing loans
|
$
|
251
|
|
|
$
|
280
|
|
|
$
|
(29
|
)
|
|
Accruing loans 90 days or more past due
|
421
|
|
|
431
|
|
|
(10
|
)
|
|
|||
Nonaccrual loans
|
197
|
|
|
317
|
|
|
(120
|
)
|
|
|||
Total
|
$
|
869
|
|
|
$
|
1,028
|
|
|
$
|
(159
|
)
|
|
Other assets
|
$
|
216
|
|
|
$
|
212
|
|
|
$
|
4
|
|
|
Liabilities
|
|
|
|
|
|
|
||||||
Other borrowed funds
|
$
|
84
|
|
|
$
|
85
|
|
|
$
|
(1
|
)
|
|
December 31, 2016
|
|
|
|
|
|
|
||||||
Assets
|
|
|
|
|
|
|
||||||
Residential mortgage loans held for sale
|
|
|
|
|
|
|
||||||
Performing loans
|
$
|
1,000
|
|
|
$
|
988
|
|
|
$
|
12
|
|
|
Accruing loans 90 days or more past due
|
4
|
|
|
4
|
|
|
|
|
||||
Nonaccrual loans
|
6
|
|
|
6
|
|
|
|
|
|
|||
Total
|
$
|
1,010
|
|
|
$
|
998
|
|
|
$
|
12
|
|
|
Commercial mortgage loans held for sale (a)
|
|
|
|
|
|
|
||||||
Performing loans
|
$
|
1,395
|
|
|
$
|
1,412
|
|
|
$
|
(17
|
)
|
|
Nonaccrual loans
|
5
|
|
|
9
|
|
|
(4
|
)
|
|
|||
Total
|
$
|
1,400
|
|
|
$
|
1,421
|
|
|
$
|
(21
|
)
|
|
Residential mortgage loans
|
|
|
|
|
|
|
||||||
Performing loans
|
$
|
247
|
|
|
$
|
289
|
|
|
$
|
(42
|
)
|
|
Accruing loans 90 days or more past due
|
427
|
|
|
428
|
|
|
(1
|
)
|
|
|||
Nonaccrual loans
|
219
|
|
|
346
|
|
|
(127
|
)
|
|
|||
Total
|
$
|
893
|
|
|
$
|
1,063
|
|
|
$
|
(170
|
)
|
|
Other assets
|
$
|
293
|
|
|
$
|
288
|
|
|
$
|
5
|
|
|
Liabilities
|
|
|
|
|
|
|
||||||
Other borrowed funds
|
$
|
81
|
|
|
$
|
82
|
|
|
$
|
(1
|
)
|
|
(a)
|
There were no accruing loans 90 days or more past due within this category at
December 31, 2017
or
December 31, 2016
.
|
Year ended December 31
In millions
|
Gains (Losses)
|
|
||||||||||
2017
|
|
|
2016
|
|
|
2015
|
|
|
||||
Assets
|
|
|
|
|
|
|
||||||
Residential mortgage loans
held for sale |
$
|
121
|
|
|
$
|
152
|
|
|
$
|
152
|
|
|
Commercial mortgage loans
held for sale |
$
|
87
|
|
|
$
|
76
|
|
|
$
|
96
|
|
|
Residential mortgage loans
|
$
|
27
|
|
|
$
|
30
|
|
|
$
|
43
|
|
|
Other assets
|
$
|
60
|
|
|
$
|
50
|
|
|
$
|
(8
|
)
|
|
Liabilities
|
|
|
|
|
|
|
||||||
Other liabilities
|
$
|
(26
|
)
|
|
|
|
|
$
|
4
|
|
|
(a)
|
The impact on earnings of offsetting hedged items or hedging instruments is not reflected in these amounts.
|
In millions
|
Carrying
Amount
|
|
|
Fair Value
|
|
|||||||||||||||
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
|||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and due from banks
|
$
|
5,249
|
|
|
$
|
5,249
|
|
|
$
|
5,249
|
|
|
|
|
|
|
||||
Interest-earning deposits with banks
|
28,595
|
|
|
28,595
|
|
|
|
|
$
|
28,595
|
|
|
|
|
||||||
Securities held to maturity
|
18,513
|
|
|
18,565
|
|
|
765
|
|
|
17,658
|
|
|
$
|
142
|
|
|
||||
Net loans (excludes leases)
|
209,044
|
|
|
211,175
|
|
|
|
|
|
|
211,175
|
|
|
|||||||
Other assets
|
6,078
|
|
|
6,736
|
|
|
|
|
5,949
|
|
|
787
|
|
|
||||||
Total assets
|
$
|
267,479
|
|
|
$
|
270,320
|
|
|
$
|
6,014
|
|
|
$
|
52,202
|
|
|
$
|
212,104
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
$
|
265,053
|
|
|
$
|
264,854
|
|
|
|
|
$
|
264,854
|
|
|
|
|
||||
Borrowed funds
|
57,744
|
|
|
58,503
|
|
|
|
|
56,853
|
|
|
$
|
1,650
|
|
|
|||||
Unfunded loan commitments and letters of credit
|
297
|
|
|
297
|
|
|
|
|
|
|
297
|
|
|
|||||||
Other liabilities
|
399
|
|
|
399
|
|
|
|
|
399
|
|
|
|
|
|||||||
Total liabilities
|
$
|
323,493
|
|
|
$
|
324,053
|
|
|
|
|
|
$
|
322,106
|
|
|
$
|
1,947
|
|
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and due from banks
|
$
|
4,879
|
|
|
$
|
4,879
|
|
|
$
|
4,879
|
|
|
|
|
|
|
||||
Interest-earning deposits with banks
|
25,711
|
|
|
25,711
|
|
|
|
|
$
|
25,711
|
|
|
|
|
||||||
Securities held to maturity
|
15,843
|
|
|
15,866
|
|
|
540
|
|
|
15,208
|
|
|
$
|
118
|
|
|
||||
Net loans (excludes leases)
|
199,766
|
|
|
201,863
|
|
|
|
|
|
|
201,863
|
|
|
|||||||
Other assets
|
4,793
|
|
|
5,243
|
|
|
|
|
4,666
|
|
|
577
|
|
|
||||||
Total assets
|
$
|
250,992
|
|
|
$
|
253,562
|
|
|
$
|
5,419
|
|
|
$
|
45,585
|
|
|
$
|
202,558
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
$
|
257,164
|
|
|
$
|
257,038
|
|
|
|
|
$
|
257,038
|
|
|
|
|
||||
Borrowed funds
|
51,736
|
|
|
52,322
|
|
|
|
|
50,941
|
|
|
$
|
1,381
|
|
|
|||||
Unfunded loan commitments and letters of credit
|
301
|
|
|
301
|
|
|
|
|
|
|
301
|
|
|
|||||||
Other liabilities
|
417
|
|
|
417
|
|
|
|
|
417
|
|
|
|
|
|||||||
Total liabilities
|
$
|
309,618
|
|
|
$
|
310,078
|
|
|
|
|
|
$
|
308,396
|
|
|
$
|
1,682
|
|
|
•
|
financial instruments recorded at fair value on a recurring basis (as they are disclosed in Table
52
),
|
•
|
investments accounted for under the equity method,
|
•
|
real and personal property,
|
•
|
lease financing,
|
•
|
loan customer relationships,
|
•
|
deposit customer intangibles,
|
•
|
mortgage servicing rights,
|
•
|
retail branch networks,
|
•
|
fee-based businesses, such as asset management and brokerage, and
|
•
|
trademarks and brand names.
|
In millions
|
Retail
Banking
|
|
Corporate &
Institutional
Banking
|
|
Asset
Management
Group
|
|
Total
|
|
|
||||
December 31, 2015
|
$
|
5,795
|
|
$
|
3,244
|
|
$
|
64
|
|
$
|
9,103
|
|
|
December 31, 2016
|
$
|
5,795
|
|
$
|
3,244
|
|
$
|
64
|
|
$
|
9,103
|
|
|
December 31, 2017 (b)
|
$
|
5,795
|
|
$
|
3,314
|
|
$
|
64
|
|
$
|
9,173
|
|
|
(a)
|
The BlackRock business segment did not have any allocated goodwill during
2017
,
2016
and
2015
.
|
(b)
|
Corporate & Institutional Banking's goodwill balance as of December 31, 2017 includes the impact of
$70 million
from business acquisitions in 2017.
|
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
January 1
|
$
|
576
|
|
|
$
|
526
|
|
|
$
|
506
|
|
|
Additions:
|
|
|
|
|
|
|
||||||
From loans sold with
servicing retained
|
88
|
|
|
61
|
|
|
63
|
|
|
|||
Purchases
|
69
|
|
|
36
|
|
|
55
|
|
|
|||
Changes in fair value due to:
|
|
|
|
|
|
|
||||||
Time and payoffs (a)
|
(111
|
)
|
|
(92
|
)
|
|
(89
|
)
|
|
|||
Other (b)
|
46
|
|
|
45
|
|
|
(9
|
)
|
|
|||
December 31
|
$
|
668
|
|
|
$
|
576
|
|
|
$
|
526
|
|
|
Related unpaid principal
balance at December 31
|
$
|
162,182
|
|
|
$
|
143,139
|
|
|
$
|
145,823
|
|
|
Servicing advances at
December 31
|
$
|
217
|
|
|
$
|
265
|
|
|
$
|
251
|
|
|
(a)
|
Represents decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan principal payments and loans that were paid down or paid off during the period.
|
(b)
|
Represents MSR value changes resulting primarily from market-driven changes in interest rates.
|
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
January 1
|
$
|
1,182
|
|
|
$
|
1,063
|
|
|
$
|
845
|
|
|
Additions:
|
|
|
|
|
|
|
||||||
From loans sold with
servicing retained
|
55
|
|
|
62
|
|
|
78
|
|
|
|||
Purchases
|
185
|
|
|
188
|
|
|
316
|
|
|
|||
Changes in fair value due to:
|
|
|
|
|
|
|
||||||
Time and payoffs (a)
|
(175
|
)
|
|
(168
|
)
|
|
(178
|
)
|
|
|||
Other (b)
|
(83
|
)
|
|
37
|
|
|
2
|
|
|
|||
December 31
|
$
|
1,164
|
|
|
$
|
1,182
|
|
|
$
|
1,063
|
|
|
Unpaid principal balance of
loans serviced for others at
December 31
|
$
|
126,769
|
|
|
$
|
125,381
|
|
|
$
|
123,466
|
|
|
Servicing advances at
December 31
|
$
|
201
|
|
|
$
|
302
|
|
|
$
|
411
|
|
|
(a)
|
Represents decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan principal payments and loans that were paid down or paid off during the period.
|
(b)
|
Represents MSR value changes resulting from market-driven changes in interest rates and changes in model assumptions.
|
Dollars in millions
|
December 31
2017 |
|
|
December 31
2016 |
|
|
||
Fair value
|
$
|
668
|
|
|
$
|
576
|
|
|
Weighted-average life (years)
|
4.4
|
|
|
4.6
|
|
|
||
Weighted-average constant
prepayment rate |
8.51
|
%
|
|
8.61
|
%
|
|
||
Decline in fair value from
10% adverse change |
$
|
12
|
|
|
$
|
11
|
|
|
Decline in fair value from
20% adverse change |
$
|
23
|
|
|
$
|
21
|
|
|
Effective discount rate
|
7.81
|
%
|
|
7.52
|
%
|
|
||
Decline in fair value from
10% adverse change |
$
|
18
|
|
|
$
|
16
|
|
|
Decline in fair value from
20% adverse change |
$
|
36
|
|
|
$
|
31
|
|
|
Dollars in millions
|
December 31
2017 |
|
|
December 31
2016 |
|
|
||
Fair value
|
$
|
1,164
|
|
|
$
|
1,182
|
|
|
Weighted-average life (years)
|
6.4
|
|
|
6.8
|
|
|
||
Weighted-average constant
prepayment rate
|
10.04
|
|
%
|
9.41
|
|
%
|
||
Decline in fair value from
10% adverse change
|
$
|
44
|
|
|
$
|
45
|
|
|
Decline in fair value from
20% adverse change
|
$
|
85
|
|
|
$
|
86
|
|
|
Weighted-average option
adjusted spread
|
830
|
|
bps
|
850
|
|
bps
|
||
Decline in fair value from
10% adverse change
|
$
|
35
|
|
|
$
|
37
|
|
|
Decline in fair value from
20% adverse change
|
$
|
67
|
|
|
$
|
72
|
|
|
In millions
|
December 31
2017 |
|
|
December 31
2016 |
|
|
||
Premises, equipment and leasehold
improvements
|
$
|
10,939
|
|
|
$
|
10,410
|
|
|
Accumulated depreciation and
amortization
|
(5,503
|
)
|
|
(4,888
|
)
|
|
||
Net book value
|
$
|
5,436
|
|
|
$
|
5,522
|
|
|
Year ended December 31
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
Depreciation
|
$
|
743
|
|
|
$
|
683
|
|
|
$
|
643
|
|
|
Amortization
|
56
|
|
|
46
|
|
|
40
|
|
|
|||
Total depreciation and amortization
|
$
|
799
|
|
|
$
|
729
|
|
|
$
|
683
|
|
|
Year ended December 31
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
Lease rental expense
|
$
|
431
|
|
|
$
|
442
|
|
|
$
|
460
|
|
|
In millions
|
|
|||
2018
|
$
|
382
|
|
|
2019
|
$
|
343
|
|
|
2020
|
$
|
302
|
|
|
2021
|
$
|
260
|
|
|
2022
|
$
|
217
|
|
|
2023 and thereafter
|
$
|
1,051
|
|
|
In billions
|
|||
2018
|
$
|
12.1
|
|
2019
|
$
|
1.1
|
|
2020
|
$
|
.9
|
|
2021
|
$
|
1.0
|
|
2022
|
$
|
.9
|
|
2023 and thereafter
|
$
|
1.3
|
|
In billions
|
|||
2018
|
$
|
16.0
|
|
2019
|
$
|
12.3
|
|
2020
|
$
|
13.8
|
|
2021
|
$
|
3.7
|
|
2022
|
$
|
4.9
|
|
2023 and thereafter
|
$
|
8.4
|
|
|
Stated Rate
|
|
Maturity
|
|
Carrying Value
|
|
||||||
Dollars in millions
|
2017
|
|
2017
|
|
2017
|
|
|
2016
|
|
|
||
Parent Company
|
|
|
|
|
|
|
|
|
||||
Senior debt
|
1.64%-6.70%
|
|
2018-2027
|
|
$
|
5,203
|
|
|
$
|
3,960
|
|
|
Subordinated debt
|
3.90%-6.88%
|
|
2019-2024
|
|
1,440
|
|
|
2,038
|
|
|
||
Junior subordinated debt
|
2.05%
|
|
2028
|
|
205
|
|
|
205
|
|
|
||
Subtotal
|
|
|
|
|
6,848
|
|
|
6,203
|
|
|
||
Bank
|
|
|
|
|
|
|
|
|
||||
FHLB (a)
|
zero-6.35%
|
|
2018-2030
|
|
21,037
|
|
|
17,549
|
|
|
||
Senior debt
|
1.05%-3.30%
|
|
2018-2043
|
|
22,859
|
|
|
19,012
|
|
|
||
Subordinated debt
|
2.70%-6.88%
|
|
2018-2025
|
|
3,555
|
|
|
5,766
|
|
|
||
Subtotal
|
|
|
|
|
47,451
|
|
|
42,327
|
|
|
||
Total
|
|
|
|
|
$
|
54,299
|
|
|
$
|
48,530
|
|
|
(a)
|
FHLB borrowings are generally collateralized by residential mortgage loans, other mortgage-related loans and commercial mortgage-backed securities.
|
|
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
|
|
•
|
Meet present and future benefit obligations to all participants and beneficiaries,
|
•
|
Cover reasonable expenses incurred to provide such benefits, including expenses incurred in the administration of the Trust and the Plan,
|
•
|
Provide sufficient liquidity to meet benefit and expense payment requirements on a timely basis, and
|
•
|
Provide a total return that, over the long term, maximizes the ratio of trust assets to liabilities by maximizing investment return, at an appropriate level of risk.
|
|
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
|
%
|
•
|
Money market funds are valued at the net asset value of the shares held by the pension plan at year end.
|
•
|
U.S. government and agency securities, corporate debt and common stock are valued at the closing price reported on the active market on which the individual securities are traded. If quoted market prices are not available for the specific security, then fair values are estimated by using pricing models or quoted prices of securities with similar characteristics. Such securities are generally classified within Level 2 of the valuation hierarchy but may be a Level 3 depending
|
•
|
Other investments held by the pension plan include derivative financial instruments, which are recorded at estimated fair value as determined by third-party appraisals and pricing models, and group annuity contracts, which are measured at fair value by discounting the related cash flows based on current yields of similar instruments with comparable durations considering the credit-worthiness of the issuer. Also included in other investments is preferred stock valued at the closing price reported on an active market on which the securities are traded.
|
•
|
Investments measured at net asset value include collective trust fund investments and limited partnerships. Collective trust fund investments are valued based upon the units of such collective trust fund held by the Plan at year end multiplied by the respective unit value. The unit value of the collective trust fund is based upon significant observable inputs, although it is not based upon quoted marked prices in an active market. The underlying investments of the collective trust funds consist primarily of equity
|
|
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.
|
|
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
|
|
|
|
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
|
|
|
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
|
%
|
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
|
|
|
Year ended
December 31, 2017 In millions except weighted-average data |
|
Shares
|
|
Weighted-
Average
Exercise
Price
|
|
Weighted-
Average
Remaining
Contractual
Life
|
Aggregate
Intrinsic
Value
|
|
||
Outstanding, January 1
|
|
3
|
|
$
|
55.16
|
|
|
|
||
Exercised
|
|
(2
|
)
|
$
|
53.22
|
|
|
|
||
Outstanding,
December 31 |
|
1
|
|
$
|
58.02
|
|
2.6 years
|
$
|
112
|
|
Vested and exercisable,
December 31 |
|
1
|
|
$
|
58.02
|
|
2.6 years
|
$
|
112
|
|
(a)
|
Cancelled stock options during
2017
were insignificant.
|
Shares in millions
|
Nonvested
Incentive/
Performance
Units Shares
|
|
Weighted-
Average
Grant
Date Fair
Value
|
|
Nonvested
Restricted
Share/
Restricted
Share
Units
|
|
Weighted-
Average
Grant Date
Fair Value
|
|
||
December 31, 2016
|
2
|
|
$
|
81.42
|
|
3
|
|
$
|
83.27
|
|
Granted (b)
|
1
|
|
$
|
122.13
|
|
1
|
|
$
|
122.09
|
|
Vested/Released (b)
|
(1
|
)
|
$
|
78.69
|
|
(1
|
)
|
$
|
80.69
|
|
December 31, 2017
|
2
|
|
$
|
94.29
|
|
3
|
|
$
|
95.64
|
|
(a)
|
Forfeited awards during
2017
were insignificant.
|
(b)
|
Includes adjustments for achieving specific performance goals for Incentive/
|
|
December 31, 2017
|
December 31, 2016
|
||||||||||||||||
In millions
|
Notional /
Contract
Amount
|
|
Asset
Fair
Value (a)
|
|
Liability
Fair
Value (b)
|
|
Notional /
Contract
Amount
|
|
Asset
Fair
Value (a)
|
|
Liability
Fair
Value (b)
|
|
||||||
Derivatives used for hedging under GAAP
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts (c):
|
|
|
|
|
|
|
||||||||||||
Fair value hedges (d)
|
$
|
34,059
|
|
$
|
114
|
|
$
|
94
|
|
$
|
34,010
|
|
$
|
551
|
|
$
|
214
|
|
Cash flow hedges (d)
|
23,875
|
|
60
|
|
6
|
|
20,831
|
|
313
|
|
71
|
|
||||||
Foreign exchange contracts:
|
|
|
|
|
|
|
||||||||||||
Net investment hedges
|
1,060
|
|
|
|
11
|
|
945
|
|
25
|
|
|
|
||||||
Total derivatives designated for hedging
|
$
|
58,994
|
|
$
|
174
|
|
$
|
111
|
|
$
|
55,786
|
|
$
|
889
|
|
$
|
285
|
|
Derivatives not used for hedging under GAAP
|
|
|
|
|
|
|
||||||||||||
Derivatives used for mortgage banking activities (e):
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
||||||||||||
Swaps (d)
|
$
|
48,335
|
|
$
|
162
|
|
$
|
42
|
|
$
|
49,071
|
|
$
|
783
|
|
$
|
505
|
|
Futures (f)
|
47,494
|
|
|
|
|
|
36,264
|
|
|
|
|
|
||||||
Mortgage-backed commitments
|
8,999
|
|
19
|
|
9
|
|
13,317
|
|
96
|
|
56
|
|
||||||
Other
|
2,530
|
|
11
|
|
2
|
|
31,907
|
|
28
|
|
4
|
|
||||||
Subtotal
|
107,358
|
|
192
|
|
53
|
|
130,559
|
|
907
|
|
565
|
|
||||||
Derivatives used for customer-related activities:
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
||||||||||||
Swaps (d)
|
194,042
|
|
2,079
|
|
1,772
|
|
173,777
|
|
2,373
|
|
2,214
|
|
||||||
Futures (f)
|
3,453
|
|
|
|
|
|
4,053
|
|
|
|
|
|
||||||
Mortgage-backed commitments
|
2,228
|
|
2
|
|
2
|
|
2,955
|
|
10
|
|
8
|
|
||||||
Other
|
17,775
|
|
75
|
|
36
|
|
16,203
|
|
55
|
|
53
|
|
||||||
Subtotal
|
217,498
|
|
2,156
|
|
1,810
|
|
196,988
|
|
2,438
|
|
2,275
|
|
||||||
Foreign exchange contracts and other
|
27,330
|
|
349
|
|
332
|
|
21,889
|
|
342
|
|
309
|
|
||||||
Subtotal
|
244,828
|
|
2,505
|
|
2,142
|
|
218,877
|
|
2,780
|
|
2,584
|
|
||||||
Derivatives used for other risk management activities:
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts and other (g)
|
7,445
|
|
3
|
|
550
|
|
5,581
|
|
40
|
|
405
|
|
||||||
Total derivatives not designated for hedging
|
$
|
359,631
|
|
$
|
2,700
|
|
$
|
2,745
|
|
$
|
355,017
|
|
$
|
3,727
|
|
$
|
3,554
|
|
Total gross derivatives
|
$
|
418,625
|
|
$
|
2,874
|
|
$
|
2,856
|
|
$
|
410,803
|
|
$
|
4,616
|
|
$
|
3,839
|
|
Less: Impact of legally enforceable master netting agreements (d)
|
|
(1,054
|
)
|
(1,054
|
)
|
|
(2,460
|
)
|
(2,460
|
)
|
||||||||
Less: Cash collateral received/paid (d)
|
|
|
(636
|
)
|
(763
|
)
|
|
|
(657
|
)
|
(484
|
)
|
||||||
Total derivatives
|
|
|
$
|
1,184
|
|
$
|
1,039
|
|
|
|
$
|
1,499
|
|
$
|
895
|
|
(a)
|
Included in Other assets on our Consolidated Balance Sheet.
|
(b)
|
Included in Other liabilities on our Consolidated Balance Sheet.
|
(c)
|
Represents primarily swaps.
|
(d)
|
In the first quarter of 2017, PNC changed its accounting treatment for variation margin related to certain derivative instruments cleared through a central clearing house. Previously, variation margin was treated as collateral subject to offsetting. As a result of changes made by the clearing house to its rules governing such instruments with its counterparties, effective for the first quarter of 2017, variation margin is treated as a settlement payment on the derivative instrument. The impact at
December 31, 2017
was a reduction of gross derivative assets and gross derivative liabilities by
$.8 billion
and
$.7 billion
, respectively. The accounting change had no impact on the net fair value of the derivative assets and liabilities that otherwise would have been reported on our Consolidated Balance Sheet. See Table
85
for more information.
|
(e)
|
Includes both residential and commercial mortgage banking activities.
|
(f)
|
Futures contracts settle in cash daily and, therefore, no derivative asset or derivative liability is recognized on our Consolidated Balance Sheet.
|
(g)
|
Includes our obligation to fund a portion of certain BlackRock LTIP programs and the swaps entered into in connection with sales of a portion of Visa Class B common shares.
|
(a)
|
The difference between the gains (losses) recognized in income on derivatives and their related hedged items represents the ineffective portion of the change in value of our fair value hedge derivatives.
|
|
Year ended
December 31
|
||||||||
In millions
|
2017
|
|
2016
|
|
2015
|
|
|||
Gains (losses) on derivatives
recognized in OCI – (effective
portion)
|
$
|
(90
|
)
|
$
|
100
|
|
$
|
415
|
|
Less: Gains (losses) reclassified from
accumulated OCI into income –
(effective portion)
|
|
|
|
||||||
Interest income
|
$
|
180
|
|
$
|
253
|
|
$
|
293
|
|
Noninterest income
|
17
|
|
|
|
(5
|
)
|
|||
Total gains (losses) reclassified from
accumulated OCI into income –
(effective portion)
|
$
|
197
|
|
$
|
253
|
|
$
|
288
|
|
Net unrealized gains (losses) on cash
flow hedge derivatives
|
$
|
(287
|
)
|
$
|
(153
|
)
|
$
|
127
|
|
(a)
|
All cash flow hedge derivatives are interest rate contracts as of December 31,
2017
, December 31,
2016
and December 31,
2015
.
|
(b)
|
The amount of cash flow hedge ineffectiveness recognized in income was not significant for the periods presented.
|
|
Year ended
December 31
|
|
||||||||||
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
Derivatives used for mortgage banking activities:
|
|
|
|
|
|
|
||||||
Interest rate contracts (a)
|
$
|
75
|
|
|
$
|
152
|
|
|
$
|
220
|
|
|
Derivatives used for customer-related activities:
|
|
|
|
|
|
|
||||||
Interest rate contracts
|
95
|
|
|
78
|
|
|
71
|
|
|
|||
Foreign exchange contracts and other
|
146
|
|
|
84
|
|
|
78
|
|
|
|||
Gains (losses) from customer-related activities (b)
|
241
|
|
|
162
|
|
|
149
|
|
|
|||
Derivatives used for other risk management activities:
|
|
|
|
|
|
|
||||||
Foreign exchange contracts and other (c)
|
(525
|
)
|
|
(7
|
)
|
|
282
|
|
|
|||
Gains (losses) from other risk management activities (b)
|
(525
|
)
|
|
(7
|
)
|
|
282
|
|
|
|||
Total gains (losses) from derivatives not designated as hedging instruments
|
$
|
(209
|
)
|
|
$
|
307
|
|
|
$
|
651
|
|
|
(a)
|
Included in Residential mortgage, Corporate services and Other noninterest income.
|
(b)
|
Included in Other noninterest income.
|
(c)
|
Includes BlackRock LTIP funding obligation and the swaps entered into in connection with sales of a portion of Visa Class B common shares.
|
|
Gross
Fair Value
|
|
|
Amounts
Offset on the
Consolidated Balance Sheet
|
|
Net
Fair Value
|
|
|
Securities
Collateral Held /
(Pledged) Under
Master Netting
Agreements
|
|
|
Net
Amounts
|
|
||||||||||
December 31, 2017
In millions |
Fair Value
Offset Amount
|
|
|
Cash
Collateral
|
|
|
|||||||||||||||||
Derivative assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Over-the-counter cleared (a)
|
$
|
827
|
|
|
$
|
251
|
|
|
$
|
567
|
|
|
$
|
9
|
|
|
|
|
$
|
9
|
|
||
Over-the-counter
|
1,695
|
|
|
668
|
|
|
67
|
|
|
960
|
|
|
$
|
32
|
|
|
928
|
|
|||||
Foreign exchange and other contracts
|
352
|
|
|
135
|
|
|
2
|
|
|
215
|
|
|
|
|
215
|
|
|||||||
Total derivative assets
|
$
|
2,874
|
|
|
$
|
1,054
|
|
|
$
|
636
|
|
|
$
|
1,184
|
|
(b)
|
$
|
32
|
|
|
$
|
1,152
|
|
Derivative liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Over-the-counter cleared (a)
|
$
|
260
|
|
|
$
|
251
|
|
|
|
|
|
$
|
9
|
|
|
|
|
$
|
9
|
|
|||
Over-the-counter
|
1,703
|
|
|
662
|
|
|
$
|
669
|
|
|
372
|
|
|
|
|
372
|
|
||||||
Foreign exchange and other contracts
|
893
|
|
|
141
|
|
|
94
|
|
|
658
|
|
|
|
|
658
|
|
|||||||
Total derivative liabilities
|
$
|
2,856
|
|
|
$
|
1,054
|
|
|
$
|
763
|
|
|
$
|
1,039
|
|
(c)
|
|
|
|
$
|
1,039
|
|
|
December 31, 2016
In millions |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Over-the-counter cleared (a)
|
$
|
1,498
|
|
|
$
|
940
|
|
|
$
|
480
|
|
|
$
|
78
|
|
|
|
|
$
|
78
|
|
||
Exchange-traded
|
9
|
|
|
|
|
|
|
|
|
9
|
|
|
|
|
|
9
|
|
||||||
Over-the-counter
|
2,702
|
|
|
1,358
|
|
|
164
|
|
|
1,180
|
|
|
$
|
62
|
|
|
1,118
|
|
|||||
Foreign exchange and other contracts
|
407
|
|
|
162
|
|
|
13
|
|
|
232
|
|
|
|
|
|
232
|
|
||||||
Total derivative assets
|
$
|
4,616
|
|
|
$
|
2,460
|
|
|
$
|
657
|
|
|
$
|
1,499
|
|
(b)
|
$
|
62
|
|
|
$
|
1,437
|
|
Derivative liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Over-the-counter cleared (a)
|
$
|
1,060
|
|
|
$
|
940
|
|
|
$
|
25
|
|
|
$
|
95
|
|
|
|
|
$
|
95
|
|
||
Exchange-traded
|
1
|
|
|
|
|
|
|
1
|
|
|
|
|
1
|
|
|||||||||
Over-the-counter
|
2,064
|
|
|
1,395
|
|
|
431
|
|
|
238
|
|
|
|
|
238
|
|
|||||||
Foreign exchange and other contracts
|
714
|
|
|
125
|
|
|
28
|
|
|
561
|
|
|
|
|
561
|
|
|||||||
Total derivative liabilities
|
$
|
3,839
|
|
|
$
|
2,460
|
|
|
$
|
484
|
|
|
$
|
895
|
|
(c)
|
|
|
|
$
|
895
|
|
(a)
|
Reflects our first quarter 2017 change in accounting treatment for variation margin for certain derivative instruments cleared through a central clearing house. The accounting change reduced the asset and liability gross fair values with corresponding reductions to the fair value and cash collateral offsets, resulting in no changes to the net fair value amounts.
|
(b)
|
Represents the net amount of derivative assets included in Other assets on our Consolidated Balance Sheet.
|
(c)
|
Represents the net amount of derivative liabilities included in Other liabilities on our Consolidated Balance Sheet.
|
In millions, except per share data
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Basic
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
5,388
|
|
|
$
|
3,985
|
|
|
$
|
4,143
|
|
Less:
|
|
|
|
|
|
|
||||||
Net income attributable to noncontrolling interests
|
|
50
|
|
|
82
|
|
|
37
|
|
|||
Preferred stock dividends
|
|
236
|
|
|
209
|
|
|
220
|
|
|||
Preferred discount accretion and redemptions
|
|
26
|
|
|
6
|
|
|
5
|
|
|||
Net income attributable to common shares
|
|
5,076
|
|
|
3,688
|
|
|
3,881
|
|
|||
Less: Dividends and undistributed earnings allocated to participating securities
|
|
23
|
|
|
26
|
|
|
17
|
|
|||
Net income attributable to basic common shares
|
|
$
|
5,053
|
|
|
$
|
3,662
|
|
|
$
|
3,864
|
|
Basic weighted-average common shares outstanding
|
|
481
|
|
|
494
|
|
|
514
|
|
|||
Basic earnings per common share (a)
|
|
$
|
10.49
|
|
|
$
|
7.42
|
|
|
$
|
7.52
|
|
Diluted
|
|
|
|
|
|
|
||||||
Net income attributable to basic common shares
|
|
$
|
5,053
|
|
|
$
|
3,662
|
|
|
$
|
3,864
|
|
Less: Impact of BlackRock earnings per share dilution
|
|
16
|
|
|
12
|
|
|
18
|
|
|||
Net income attributable to diluted common shares
|
|
$
|
5,037
|
|
|
$
|
3,650
|
|
|
$
|
3,846
|
|
Basic weighted-average common shares outstanding
|
|
481
|
|
|
494
|
|
|
514
|
|
|||
Dilutive potential common shares
|
|
5
|
|
|
6
|
|
|
7
|
|
|||
Diluted weighted-average common shares outstanding
|
|
486
|
|
|
500
|
|
|
521
|
|
|||
Diluted earnings per common share (a)
|
|
$
|
10.36
|
|
|
$
|
7.30
|
|
|
$
|
7.39
|
|
(a)
|
Basic and diluted earnings per share under the two-class method are determined on net income reported on the income statement less earnings allocated to nonvested restricted shares and restricted share units with nonforfeitable dividends and dividend rights (participating securities).
|
|
|
|
|
Preferred Shares
|
|
||||||
December 31
Shares in thousands
|
|
Liquidation
value per share
|
|
|
2017
|
|
|
2016
|
|
|
|
Authorized
|
|
|
|
|
|
|
|
||||
$1 par value
|
|
|
|
20,000
|
|
|
20,000
|
|
|
||
Issued and outstanding
|
|
|
|
|
|
|
|
||||
Series B
|
|
$
|
40
|
|
|
1
|
|
|
1
|
|
|
Series O
|
|
$
|
100,000
|
|
|
10
|
|
|
10
|
|
|
Series P
|
|
$
|
100,000
|
|
|
15
|
|
|
15
|
|
|
Series Q
|
|
$
|
100,000
|
|
|
5
|
|
|
5
|
|
|
Series R
|
|
$
|
100,000
|
|
|
5
|
|
|
5
|
|
|
Series S
|
|
$
|
100,000
|
|
|
5
|
|
|
5
|
|
|
Total issued and outstanding
|
|
|
|
|
41
|
|
|
41
|
|
|
Preferred Stock
|
Issue
Date
|
Number of
Depositary
Shares Issued
|
|
Fractional
Interest in a
share of
preferred stock
represented by
each Depositary
Share
|
Dividend Dates (a)
|
Annual Per Share
Dividend Rate
|
|
Optional
Redemption
Date (b)
|
|
Series B (c)
|
(c)
|
N/A
|
|
N/A
|
Quarterly from March 10
th
|
$
|
1.80
|
|
None
|
Series O (d)
|
July 27, 2011
|
1 million
|
|
1/100
th
|
Semi-annually beginning on February 1, 2012
until August 1, 2021 Quarterly beginning on November 1, 2021 |
6.75% until August 1, 2021
3 Mo. LIBOR plus 3.678% per annum beginning on August 1, 2021 |
|
August 1, 2021
|
|
Series P (d)
|
April 24, 2012
|
60 million
|
|
1/4,000
th
|
Quarterly beginning on August 1, 2012
|
6.125% until May 1, 2022
3 Mo. LIBOR plus 4.0675% per annum beginning on May 1, 2022 |
|
May 1, 2022
|
|
Series Q (d)
|
September 21, 2012
October 9, 2012 |
18 million
1.2 million |
|
1/4,000
th
|
Quarterly beginning on December 1, 2012
|
5.375
|
%
|
December 1, 2017
|
|
Series R (d)
|
May 7, 2013
|
500,000
|
|
1/100
th
|
Semi-annually beginning on December 1, 2013
until June 1, 2023 Quarterly beginning on September 1, 2023 |
4.85% until June 1, 2023
3 Mo. LIBOR plus 3.04% per annum beginning June 1, 2023 |
|
June 1, 2023
|
|
Series S (d)
|
November 1, 2016
|
525,000
|
|
1/100
th
|
Semi-annually beginning on May 1, 2017
until November 1, 2026 Quarterly beginning on February 1, 2027 |
5.00% until November 1, 2026
3 Mo. LIBOR plus 3.30% per annum beginning November 1, 2026 |
|
November 1, 2026
|
(a)
|
Dividends are payable when, as, and if declared by our Board of Directors or an authorized committee of our Board of Directors.
|
(b)
|
Redeemable at our option on or after the date stated. With the exception of the Series B preferred stock, redeemable at our option within
90 days
of a regulatory capital treatment event as defined in the designations.
|
(c)
|
Cumulative preferred stock. Holders of Series B preferred stock are entitled to
8
votes per share, which is equal to the number of full shares of common stock into which the Series B preferred stock is convertible. The Series B preferred stock was issued in connection with the consolidation of Pittsburgh National Corporation and Provident National Corporation in 1983.
|
(d)
|
Non-Cumulative preferred stock.
|
In millions
|
2017
|
|
2016
|
|
2015
|
|
|
|||
Net unrealized gains (losses) on non-OTTI securities
|
|
|
|
|
||||||
Increase in net unrealized gains (losses) on non-OTTI securities
|
$
|
29
|
|
$
|
(329
|
)
|
$
|
(494
|
)
|
|
Less: Net gains (losses) realized as a yield adjustment reclassified to investment securities interest income
|
25
|
|
24
|
|
27
|
|
|
|||
Less: Net gains (losses) realized on sales of securities reclassified to noninterest income
|
(12
|
)
|
16
|
|
48
|
|
|
|||
Net increase (decrease), pre-tax
|
16
|
|
(369
|
)
|
(569
|
)
|
|
|||
Effect of income taxes
|
(6
|
)
|
135
|
|
208
|
|
|
|||
Net increase (decrease), after-tax
|
10
|
|
(234
|
)
|
(361
|
)
|
|
|||
Net unrealized gains (losses) on OTTI securities
|
|
|
|
|
||||||
Increase in net unrealized gains (losses) on OTTI securities
|
173
|
|
61
|
|
(17
|
)
|
|
|||
Less: Net gains (losses) realized on sales of securities reclassified to noninterest income
|
2
|
|
|
|
|
|
||||
Less: OTTI losses realized on securities reclassified to noninterest income
|
(1
|
)
|
(2
|
)
|
(4
|
)
|
|
|||
Net increase (decrease), pre-tax
|
172
|
|
63
|
|
(13
|
)
|
|
|||
Effect of income taxes
|
(63
|
)
|
(23
|
)
|
5
|
|
|
|||
Net increase (decrease), after-tax
|
109
|
|
40
|
|
(8
|
)
|
|
|||
Net unrealized gains (losses) on cash flow hedge derivatives
|
|
|
|
|
||||||
Increase in net unrealized gains (losses) on cash flow hedge derivatives
|
(90
|
)
|
100
|
|
415
|
|
|
|||
Less: Net gains (losses) realized as a yield adjustment reclassified to loan interest income
|
159
|
|
219
|
|
270
|
|
|
|||
Less: Net gains (losses) realized as a yield adjustment reclassified to investment securities interest income
|
21
|
|
34
|
|
23
|
|
|
|||
Less: Net gains (losses) realized on sales of securities reclassified to noninterest income
|
17
|
|
|
|
(5
|
)
|
|
|||
Net increase (decrease), pre-tax
|
(287
|
)
|
(153
|
)
|
127
|
|
|
|||
Effect of income taxes
|
105
|
|
56
|
|
(47
|
)
|
|
|||
Net increase (decrease), after-tax
|
(182
|
)
|
(97
|
)
|
80
|
|
|
|||
Pension and other postretirement benefit plan adjustments
|
|
|
|
|
||||||
Net pension and other postretirement benefit activity
|
126
|
|
(41
|
)
|
(82
|
)
|
|
|||
Amortization of actuarial loss (gain) reclassified to other noninterest expense
|
47
|
|
50
|
|
38
|
|
|
|||
Amortization of prior service cost (credit) reclassified to other noninterest expense
|
(4
|
)
|
(8
|
)
|
(10
|
)
|
|
|||
Net increase (decrease), pre-tax
|
169
|
|
1
|
|
(54
|
)
|
|
|||
Effect of income taxes
|
(62
|
)
|
|
|
20
|
|
|
|||
Net increase (decrease), after-tax
|
107
|
|
1
|
|
(34
|
)
|
|
|||
Other
|
|
|
|
|
||||||
PNC’s portion of BlackRock’s OCI
|
52
|
|
(63
|
)
|
(39
|
)
|
|
|||
Net investment hedge derivatives
|
(81
|
)
|
186
|
|
60
|
|
|
|||
Foreign currency translation adjustments
|
90
|
|
(182
|
)
|
(63
|
)
|
|
|||
Net increase (decrease), pre-tax
|
61
|
|
(59
|
)
|
(42
|
)
|
|
|||
Effect of income taxes
|
12
|
|
(46
|
)
|
(8
|
)
|
|
|||
Net increase (decrease), after-tax
|
73
|
|
(105
|
)
|
(50
|
)
|
|
|||
Total other comprehensive income, pre-tax
|
131
|
|
(517
|
)
|
(551
|
)
|
|
|||
Total other comprehensive income, tax effect
|
(14
|
)
|
122
|
|
178
|
|
|
|||
Total other comprehensive income, after-tax
|
$
|
117
|
|
$
|
(395
|
)
|
$
|
(373
|
)
|
|
In millions, after-tax
|
Net unrealized gains (losses) on non-OTTI securities
|
|
|
Net unrealized gains (losses) on OTTI securities
|
|
|
Net unrealized gains (losses) on cash flow hedge derivatives
|
|
|
Pension and other postretirement benefit plan adjustments
|
|
|
Other
|
|
|
Total
|
|
|
||||||
Balance at December 31, 2014
|
$
|
647
|
|
|
$
|
74
|
|
|
$
|
350
|
|
|
$
|
(520
|
)
|
|
$
|
(48
|
)
|
|
$
|
503
|
|
|
Net activity
|
(361
|
)
|
|
(8
|
)
|
|
80
|
|
|
(34
|
)
|
|
(50
|
)
|
|
(373
|
)
|
|
||||||
Balance at December 31, 2015
|
$
|
286
|
|
|
$
|
66
|
|
|
$
|
430
|
|
|
$
|
(554
|
)
|
|
$
|
(98
|
)
|
|
$
|
130
|
|
|
Net activity
|
(234
|
)
|
|
40
|
|
|
(97
|
)
|
|
1
|
|
|
(105
|
)
|
|
(395
|
)
|
|
||||||
Balance at December 31, 2016
|
$
|
52
|
|
|
$
|
106
|
|
|
$
|
333
|
|
|
$
|
(553
|
)
|
|
$
|
(203
|
)
|
|
$
|
(265
|
)
|
|
Net Activity
|
10
|
|
|
109
|
|
|
(182
|
)
|
|
107
|
|
|
73
|
|
|
117
|
|
|
||||||
Balance at December 31, 2017
|
$
|
62
|
|
|
$
|
215
|
|
|
$
|
151
|
|
|
$
|
(446
|
)
|
|
$
|
(130
|
)
|
|
$
|
(148
|
)
|
|
Year ended December 31
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
Current
|
|
|
|
|
|
|
||||||
Federal
|
$
|
454
|
|
|
$
|
871
|
|
|
$
|
927
|
|
|
State
|
51
|
|
|
71
|
|
|
33
|
|
|
|||
Total current
|
505
|
|
|
942
|
|
|
960
|
|
|
|||
Deferred
|
|
|
|
|
|
|
||||||
Federal
|
(474
|
)
|
|
301
|
|
|
320
|
|
|
|||
State
|
71
|
|
|
25
|
|
|
84
|
|
|
|||
Total deferred
|
(403
|
)
|
|
326
|
|
|
404
|
|
|
|||
Total (a)
|
$
|
102
|
|
|
$
|
1,268
|
|
|
$
|
1,364
|
|
|
December 31 – in millions
|
2017 (a)
|
|
|
2016
|
|
|
||
Deferred tax assets
|
|
|
|
|
||||
Allowance for loan and lease losses
|
$
|
631
|
|
|
$
|
976
|
|
|
Compensation and benefits
|
223
|
|
|
548
|
|
|
||
Partnership investments
|
173
|
|
|
307
|
|
|
||
Loss and credit carryforward
|
301
|
|
|
460
|
|
|
||
Accrued expenses
|
284
|
|
|
505
|
|
|
||
Other
|
131
|
|
|
252
|
|
|
||
Total gross deferred tax assets
|
1,743
|
|
|
3,048
|
|
|
||
Valuation allowance
|
(40
|
)
|
|
(75
|
)
|
|
||
Total deferred tax assets
|
1,703
|
|
|
2,973
|
|
|
||
Deferred tax liabilities
|
|
|
|
|
||||
Leasing
|
1,034
|
|
|
1,374
|
|
|
||
Goodwill and intangibles
|
197
|
|
|
312
|
|
|
||
Fixed assets
|
206
|
|
|
391
|
|
|
||
Mortgage servicing rights
|
146
|
|
|
246
|
|
|
||
Net unrealized gains on securities and
financial instruments
|
155
|
|
|
284
|
|
|
||
BlackRock basis difference
|
1,594
|
|
|
2,361
|
|
|
||
Other
|
345
|
|
|
371
|
|
|
||
Total deferred tax liabilities
|
3,677
|
|
|
5,339
|
|
|
||
Net deferred tax liability
|
$
|
1,974
|
|
|
$
|
2,366
|
|
|
Year ended December 31
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
Statutory tax rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
|
Increases (decreases) resulting from:
|
|
|
|
|
|
|
|||
State taxes net of federal benefit
|
1.5
|
|
|
1.2
|
|
|
1.4
|
|
|
Tax-exempt interest
|
(2.5
|
)
|
|
(2.4
|
)
|
|
(2.3
|
)
|
|
Life insurance
|
(1.8
|
)
|
|
(1.9
|
)
|
|
(1.7
|
)
|
|
Dividend received deduction
|
(1.8
|
)
|
|
(1.8
|
)
|
|
(1.7
|
)
|
|
Tax credits
|
(4.2
|
)
|
|
(4.4
|
)
|
|
(3.9
|
)
|
|
Federal deferred tax revaluation
|
(21.7
|
)
|
|
|
|
|
|
||
Other
|
(2.6
|
)
|
|
(1.6
|
)
|
|
(2.0
|
)
|
(a)
|
Effective tax rate (b)
|
1.9
|
%
|
|
24.1
|
%
|
|
24.8
|
%
|
|
(a)
|
Includes tax benefits associated with settlement of acquired entity tax contingencies.
|
(b)
|
The effective tax rates are generally lower than the statutory rate due to the relationship of pretax income to tax credits and earnings that are not subject to tax. The 2017 results benefited from the new federal tax legislation. Certain tax legislation amounts are considered reasonable estimates as of December 31, 2017.
|
Dollars in millions
|
December 31,
2017 |
|
|
December 31,
2016 |
|
|
Expiration
|
|
||
Net Operating Loss
Carryforwards:
|
|
|
|
|
|
|
||||
Federal
|
$
|
640
|
|
|
$
|
759
|
|
|
2032
|
|
State
|
$
|
1,776
|
|
|
$
|
2,345
|
|
|
2018 – 2036
|
|
In millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
Balance of gross unrecognized tax
benefits at January 1
|
$
|
22
|
|
|
$
|
26
|
|
|
$
|
77
|
|
|
Increases:
|
|
|
|
|
|
|
||||||
Positions taken during a prior period
|
4
|
|
|
14
|
|
|
17
|
|
|
|||
Decreases:
|
|
|
|
|
|
|
||||||
Positions taken during a prior period
|
(3
|
)
|
|
(14
|
)
|
|
(9
|
)
|
|
|||
Settlements with taxing authorities
|
(4
|
)
|
|
|
|
|
(52
|
)
|
|
|||
Reductions resulting from lapse of
statute of limitations
|
(1
|
)
|
|
(4
|
)
|
|
(7
|
)
|
|
|||
Balance of gross unrecognized tax
benefits at December 31
|
$
|
18
|
|
|
$
|
22
|
|
|
$
|
26
|
|
|
Favorable (unfavorable) impact if
recognized
|
$
|
17
|
|
|
$
|
18
|
|
|
$
|
20
|
|
|
|
Years under examination
|
|
Status at
December 31
|
|
Federal
|
2014 – 2015
|
|
Completed
|
|
|
2016
|
|
Under Exam
|
|
|
Amount
|
|
Ratios
|
|
|||||||||||||
December 31
Dollars in millions |
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
|
“Well
Capitalized”
Requirements
|
|
|
||
Risk-based capital
|
|
|
|
|
|
|
|
|
|
|
|||||||
Common equity Tier 1
|
|
|
|
|
|
|
|
|
|
||||||||
PNC
|
$
|
32,146
|
|
|
$
|
31,799
|
|
|
10.4
|
%
|
|
10.6
|
%
|
|
N/A
|
|
|
PNC Bank
|
$
|
28,771
|
|
|
$
|
27,896
|
|
|
9.7
|
%
|
|
9.7
|
%
|
|
6.5
|
%
|
|
Tier 1
|
|
|
|
|
|
|
|
|
|
|
|||||||
PNC
|
$
|
36,007
|
|
|
$
|
36,101
|
|
|
11.6
|
%
|
|
12.0
|
%
|
|
6.0
|
%
|
|
PNC Bank
|
$
|
28,942
|
|
|
$
|
29,495
|
|
|
9.7
|
%
|
|
10.2
|
%
|
|
8.0
|
%
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|||||||
PNC
|
$
|
42,496
|
|
|
$
|
43,016
|
|
|
13.7
|
%
|
|
14.3
|
%
|
|
10.0
|
%
|
|
PNC Bank
|
$
|
34,756
|
|
|
$
|
35,842
|
|
|
11.7
|
%
|
|
12.4
|
%
|
|
10.0
|
%
|
|
Leverage
|
|
|
|
|
|
|
|
|
|
|
|||||||
PNC
|
$
|
36,007
|
|
|
$
|
36,101
|
|
|
9.9
|
%
|
|
10.1
|
%
|
|
N/A
|
|
|
PNC Bank
|
$
|
28,942
|
|
|
$
|
29,495
|
|
|
8.2
|
%
|
|
8.6
|
%
|
|
5.0
|
%
|
|
(a)
|
Calculated using the Transitional Basel III regulatory capital methodology applicable to us during both
2017
and
2016
.
|
•
|
Capital needs,
|
•
|
Laws and regulations,
|
•
|
Corporate policies,
|
•
|
Contractual restrictions, and
|
•
|
Other factors.
|
•
|
In April 2011, as a result of a publicly-disclosed interagency horizontal review of residential mortgage servicing operations at fourteen federally regulated mortgage servicers, The PNC Financial Services Group, Inc. entered into a consent order with the Board of Governors of the Federal Reserve System and PNC Bank entered into a consent order with the Office of the Comptroller of the Currency. Collectively, these consent orders describe certain foreclosure-related practices and controls that the regulators found to be deficient and require The PNC Financial Services Group, Inc. and PNC Bank to, among other things, develop and implement plans and programs to enhance our residential mortgage servicing and foreclosure processes, retain an independent consultant to review certain residential mortgage foreclosure actions, take certain remedial actions, and oversee compliance with the orders and the new plans and programs. In early 2013, The PNC Financial Services Group, Inc. and PNC Bank, along with twelve other residential mortgage servicers, reached agreements with the OCC and the Federal Reserve to amend these consent orders.
|
•
|
We received subpoenas from the U.S. Attorney’s Office for the Southern District of New York. The first two subpoenas, served in 2011, concern National City Bank’s lending practices in connection with loans insured by the Federal Housing Administration (FHA) as well as certain non-FHA-insured loan origination, sale and securitization practices. A third, served in 2013, seeks information regarding claims for costs that are incurred by foreclosure counsel in connection with the foreclosure of loans insured or guaranteed by FHA, FNMA or FHLMC. We are cooperating with the investigations.
|
In millions
|
|
December 31 2017
|
|
|
December 31 2016
|
|
|
||
Commitments to extend credit
|
|
|
|
|
|
||||
Total commercial lending
|
|
$
|
112,125
|
|
|
$
|
108,256
|
|
|
Home equity lines of credit
|
|
17,852
|
|
|
17,438
|
|
|
||
Credit card
|
|
24,911
|
|
|
22,095
|
|
|
||
Other
|
|
4,753
|
|
|
4,192
|
|
|
||
Total commitments to extend credit
|
|
159,641
|
|
|
151,981
|
|
|
||
Net outstanding standby letters of
credit (a) |
|
8,651
|
|
|
8,324
|
|
|
||
Reinsurance agreements (b)
|
|
1,654
|
|
|
1,835
|
|
|
||
Standby bond purchase agreements (c)
|
|
843
|
|
|
790
|
|
|
||
Other commitments (d)
|
|
1,732
|
|
|
967
|
|
|
||
Total commitments to extend
credit and other commitments |
|
$
|
172,521
|
|
|
$
|
163,897
|
|
|
(a)
|
Net outstanding standby letters of credit include
$3.5 billion
and
$3.9 billion
at
December 31, 2017
and
December 31, 2016
, respectively, which support remarketing programs.
|
(b)
|
Represents aggregate maximum exposure up to the specified limits of the reinsurance contracts provided by our wholly-owned captive insurance subsidiary. These amounts reflect estimates based on availability of financial information from insurance carriers. As of
December 31, 2017
, the aggregate maximum exposure amount comprised
$1.5 billion
for accidental death & dismemberment contracts and
$.2 billion
for credit life, accident & health contracts. Comparable amounts at
December 31, 2016
were
$1.5 billion
and
$.3 billion
, respectively.
|
(c)
|
We enter into standby bond purchase agreements to support municipal bond
|
(d)
|
Includes
$.5 billion
related to investments in qualified affordable housing projects at both
December 31, 2017
and
December 31, 2016
.
|
Year ended December 31 – in millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Operating Revenue
|
|
|
|
|
|
||||||
Dividends from:
|
|
|
|
|
|
||||||
Bank subsidiaries and bank holding
company |
$
|
3,278
|
|
|
$
|
2,906
|
|
|
$
|
3,110
|
|
Non-bank subsidiaries
|
376
|
|
|
130
|
|
|
49
|
|
|||
Interest income
|
109
|
|
|
93
|
|
|
82
|
|
|||
Noninterest income
|
37
|
|
|
13
|
|
|
56
|
|
|||
Total operating revenue
|
3,800
|
|
|
3,142
|
|
|
3,297
|
|
|||
Operating Expense
|
|
|
|
|
|
||||||
Interest expense
|
215
|
|
|
197
|
|
|
193
|
|
|||
Other expense
|
175
|
|
|
109
|
|
|
89
|
|
|||
Total operating expense
|
390
|
|
|
306
|
|
|
282
|
|
|||
Income before income taxes and equity
in undistributed net income of subsidiaries |
3,410
|
|
|
2,836
|
|
|
3,015
|
|
|||
Income tax benefits
|
(52
|
)
|
|
(96
|
)
|
|
(98
|
)
|
|||
Income before equity in undistributed
net income of subsidiaries |
3,462
|
|
|
2,932
|
|
|
3,113
|
|
|||
Equity in undistributed net income of
subsidiaries: |
|
|
|
|
|
||||||
Bank subsidiaries and bank holding
company |
1,974
|
|
|
818
|
|
|
736
|
|
|||
Non-bank subsidiaries
|
(98
|
)
|
|
153
|
|
|
257
|
|
|||
Net income
|
$
|
5,338
|
|
|
$
|
3,903
|
|
|
$
|
4,106
|
|
Other comprehensive income, net of
tax: |
|
|
|
|
|
||||||
Net pension and other postretirement
benefit plan activity arising during the period |
1
|
|
|
13
|
|
|
(3
|
)
|
|||
Other comprehensive income (loss)
|
1
|
|
|
13
|
|
|
(3
|
)
|
|||
Comprehensive income
|
$
|
5,339
|
|
|
$
|
3,916
|
|
|
$
|
4,103
|
|
December 31 – in millions
|
2017
|
|
|
2016
|
|
||
Assets
|
|
|
|
||||
Cash held at banking subsidiary
|
$
|
1
|
|
|
$
|
1
|
|
Restricted deposits with banking subsidiary
|
175
|
|
|
175
|
|
||
Nonrestricted interest-earning deposits
|
5,800
|
|
|
4,684
|
|
||
Investments in:
|
|
|
|
||||
Bank subsidiaries and bank holding
company |
44,360
|
|
|
42,361
|
|
||
Non-bank subsidiaries
|
2,398
|
|
|
2,859
|
|
||
Loans with affiliates
|
1,244
|
|
|
1,358
|
|
||
Other assets
|
1,243
|
|
|
1,322
|
|
||
Total assets
|
$
|
55,221
|
|
|
$
|
52,760
|
|
Liabilities
|
|
|
|
||||
Subordinated debt (a)
|
$
|
1,645
|
|
|
$
|
2,242
|
|
Senior debt (a)
|
5,203
|
|
|
3,959
|
|
||
Commercial paper
|
100
|
|
|
|
|||
Other borrowed funds from affiliates
|
108
|
|
|
223
|
|
||
Accrued expenses and other liabilities
|
652
|
|
|
637
|
|
||
Total liabilities
|
7,708
|
|
|
7,061
|
|
||
Equity
|
|
|
|
||||
Shareholders’ equity
|
47,513
|
|
|
45,699
|
|
||
Total liabilities and equity
|
$
|
55,221
|
|
|
$
|
52,760
|
|
(a)
|
See Note 10 Borrowed Funds for additional information on contractual rates and maturity dates of senior debt and subordinated debt for parent company.
|
Year ended December 31 – in millions
|
|
Interest
Paid
|
|
|
Income Tax
Refunds /
(Payments)
|
|
||
2017
|
|
$
|
287
|
|
|
$
|
40
|
|
2016
|
|
$
|
317
|
|
|
$
|
183
|
|
2015
|
|
$
|
404
|
|
|
$
|
64
|
|
Year ended December 31 – in millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||
Operating Activities
|
|
|
|
|
|
||||||
Net income
|
$
|
5,338
|
|
|
$
|
3,903
|
|
|
$
|
4,106
|
|
Adjustments to reconcile net income
to net cash provided by operating activities: |
|
|
|
|
|
||||||
Equity in undistributed net
earnings of subsidiaries |
(1,974
|
)
|
|
(971
|
)
|
|
(993
|
)
|
|||
Return on investment in subsidiary
|
98
|
|
|
|
|
|
|||||
Other
|
194
|
|
|
143
|
|
|
149
|
|
|||
Net cash provided (used) by operating
activities |
3,656
|
|
|
3,075
|
|
|
3,262
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Net change in loans and securities
from affiliates |
114
|
|
|
2,161
|
|
|
(185
|
)
|
|||
Net change in restricted deposits with
banking subsidiary |
|
|
(175
|
)
|
|
400
|
|
||||
Net change in nonrestricted
interest-earning deposits |
(1,116
|
)
|
|
(1,607
|
)
|
|
3,244
|
|
|||
Net change in restricted
interest-earning deposits |
|
|
300
|
|
|
(300
|
)
|
||||
Other
|
|
|
|
266
|
|
|
(82
|
)
|
|||
Net cash provided (used) by
investing activities |
(1,002
|
)
|
|
945
|
|
|
3,077
|
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Net change in other borrowed funds
from affiliates |
316
|
|
|
(124
|
)
|
|
(100
|
)
|
|||
Net change in senior debt
|
1,325
|
|
|
(1,252
|
)
|
|
(1,888
|
)
|
|||
Net change in subordinated debt
|
(580
|
)
|
|
17
|
|
|
(580
|
)
|
|||
Net change in commercial paper
|
100
|
|
|
|
|
|
|||||
Preferred stock issuances
|
|
|
519
|
|
|
|
|||||
Preferred stock redemptions
|
|
|
|
|
(500
|
)
|
|||||
Common and treasury stock issuances
|
132
|
|
|
151
|
|
|
139
|
|
|||
Acquisition of treasury stock
|
(2,447
|
)
|
|
(2,062
|
)
|
|
(2,152
|
)
|
|||
Preferred stock cash dividends paid
|
(236
|
)
|
|
(209
|
)
|
|
(219
|
)
|
|||
Common stock cash dividends paid
|
(1,264
|
)
|
|
(1,060
|
)
|
|
(1,039
|
)
|
|||
Net cash provided (used) by
financing activities |
(2,654
|
)
|
|
(4,020
|
)
|
|
(6,339
|
)
|
|||
Cash held at banking subsidiary at
beginning of year |
1
|
|
|
1
|
|
|
1
|
|
|||
Cash held at banking subsidiary at
end of year |
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
•
|
Retail Banking
|
•
|
Corporate & Institutional Banking
|
•
|
Asset Management Group
|
•
|
BlackRock
|
Year ended December 31
In millions |
|
Retail
Banking
|
|
|
Corporate &
Institutional
Banking
|
|
|
Asset
Management
Group
|
|
|
BlackRock
|
|
|
Other
|
|
|
Consolidated (a)
|
|
||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest income
|
|
$
|
4,625
|
|
|
$
|
3,396
|
|
|
$
|
287
|
|
|
|
|
$
|
800
|
|
|
$
|
9,108
|
|
||
Noninterest income
|
|
2,236
|
|
|
2,271
|
|
|
881
|
|
|
$
|
1,078
|
|
|
755
|
|
|
7,221
|
|
|||||
Total revenue
|
|
6,861
|
|
|
5,667
|
|
|
1,168
|
|
|
1,078
|
|
|
1,555
|
|
|
16,329
|
|
||||||
Provision for credit losses (benefit)
|
|
347
|
|
|
160
|
|
|
1
|
|
|
|
|
(67
|
)
|
|
441
|
|
|||||||
Depreciation and amortization
|
|
177
|
|
|
184
|
|
|
50
|
|
|
|
|
510
|
|
|
921
|
|
|||||||
Other noninterest expense
|
|
5,274
|
|
|
2,244
|
|
|
813
|
|
|
|
|
|
1,146
|
|
|
9,477
|
|
||||||
Income (loss) before income taxes (benefit) and
noncontrolling interests |
|
1,063
|
|
|
3,079
|
|
|
304
|
|
|
1,078
|
|
|
(34
|
)
|
|
5,490
|
|
||||||
Income taxes (benefit)
|
|
533
|
|
|
615
|
|
|
102
|
|
|
(686
|
)
|
|
(462
|
)
|
|
102
|
|
||||||
Net income
|
|
$
|
530
|
|
|
$
|
2,464
|
|
|
$
|
202
|
|
|
$
|
1,764
|
|
|
$
|
428
|
|
|
$
|
5,388
|
|
Average Assets (b)
|
|
$
|
88,663
|
|
|
$
|
148,414
|
|
|
$
|
7,511
|
|
|
$
|
7,677
|
|
|
$
|
119,504
|
|
|
$
|
371,769
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest income
|
|
$
|
4,509
|
|
|
$
|
3,181
|
|
|
$
|
300
|
|
|
|
|
$
|
401
|
|
|
$
|
8,391
|
|
||
Noninterest income
|
|
2,693
|
|
|
2,035
|
|
|
851
|
|
|
$
|
685
|
|
|
507
|
|
|
6,771
|
|
|||||
Total revenue
|
|
7,202
|
|
|
5,216
|
|
|
1,151
|
|
|
685
|
|
|
908
|
|
|
15,162
|
|
||||||
Provision for credit losses (benefit)
|
|
297
|
|
|
177
|
|
|
(6
|
)
|
|
|
|
(35
|
)
|
|
433
|
|
|||||||
Depreciation and amortization
|
|
175
|
|
|
153
|
|
|
45
|
|
|
|
|
470
|
|
|
843
|
|
|||||||
Other noninterest expense
|
|
5,116
|
|
|
2,069
|
|
|
780
|
|
|
|
|
|
668
|
|
|
8,633
|
|
||||||
Income (loss) before income taxes (benefit) and
noncontrolling interests |
|
1,614
|
|
|
2,817
|
|
|
332
|
|
|
685
|
|
|
(195
|
)
|
|
5,253
|
|
||||||
Income taxes (benefit)
|
|
591
|
|
|
908
|
|
|
122
|
|
|
153
|
|
|
(506
|
)
|
|
1,268
|
|
||||||
Net income
|
|
$
|
1,023
|
|
|
$
|
1,909
|
|
|
$
|
210
|
|
|
$
|
532
|
|
|
$
|
311
|
|
|
$
|
3,985
|
|
Average Assets (b)
|
|
$
|
85,871
|
|
|
$
|
140,309
|
|
|
$
|
7,707
|
|
|
$
|
7,118
|
|
|
$
|
120,255
|
|
|
$
|
361,260
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
INCOME STATEMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest income
|
|
$
|
4,306
|
|
|
$
|
3,144
|
|
|
$
|
292
|
|
|
|
|
$
|
536
|
|
|
$
|
8,278
|
|
||
Noninterest income
|
|
2,781
|
|
|
1,947
|
|
|
869
|
|
|
$
|
717
|
|
|
633
|
|
|
6,947
|
|
|||||
Total revenue
|
|
7,087
|
|
|
5,091
|
|
|
1,161
|
|
|
717
|
|
|
1,169
|
|
|
15,225
|
|
||||||
Provision for credit losses (benefit)
|
|
253
|
|
|
78
|
|
|
9
|
|
|
|
|
(85
|
)
|
|
255
|
|
|||||||
Depreciation and amortization
|
|
187
|
|
|
149
|
|
|
44
|
|
|
|
|
429
|
|
|
809
|
|
|||||||
Other noninterest expense
|
|
5,257
|
|
|
2,038
|
|
|
802
|
|
|
|
|
|
557
|
|
|
8,654
|
|
||||||
Income before income taxes (benefit) and noncontrolling
interests |
|
1,390
|
|
|
2,826
|
|
|
306
|
|
|
717
|
|
|
268
|
|
|
5,507
|
|
||||||
Income taxes (benefit)
|
|
506
|
|
|
934
|
|
|
112
|
|
|
169
|
|
|
(357
|
)
|
|
1,364
|
|
||||||
Net income
|
|
$
|
884
|
|
|
$
|
1,892
|
|
|
$
|
194
|
|
|
$
|
548
|
|
|
$
|
625
|
|
|
$
|
4,143
|
|
Average Assets (b)
|
|
$
|
86,977
|
|
|
$
|
133,754
|
|
|
$
|
7,920
|
|
|
$
|
6,983
|
|
|
$
|
119,330
|
|
|
$
|
354,964
|
|
(a)
|
There were no material intersegment revenues for the years ended
2017
,
2016
and
2015
.
|
(b)
|
Period-end balances for BlackRock.
|
•
|
$900 million
of senior notes with a maturity date of
January 22, 2021
. Interest is payable semi-annually at a fixed rate of
2.50%
per annum on January 22 and July 22 of each year, beginning on July 22, 2018.
|
•
|
$700 million
of senior notes with a maturity date of
January 22, 2028
. Interest is payable semi-annually at a fixed rate of
3.25%
per annum on January 22 and July 22 of each year, beginning on July 22, 2018.
|
•
|
$400 million
of senior floating rate notes with a maturity date of
January 22, 2021
. Interest is payable at the 3-month LIBOR rate reset quarterly, plus a spread of
.25%
, on January 22, April 22, July 22, and October 22 of each year, beginning on April 22, 2018.
|
Dollars in millions, except per share data
|
2017
|
|
|
2016
|
|
||||||||||||||||||||||||||||
Fourth
|
|
|
Third
|
|
|
Second
|
|
|
First
|
|
|
|
Fourth
|
|
|
Third
|
|
|
Second
|
|
|
First
|
|
|
|||||||||
Summary of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Interest income
|
$
|
2,825
|
|
|
$
|
2,795
|
|
|
$
|
2,674
|
|
|
$
|
2,520
|
|
|
|
$
|
2,453
|
|
|
$
|
2,408
|
|
|
$
|
2,384
|
|
|
$
|
2,407
|
|
|
Interest expense
|
480
|
|
|
450
|
|
|
416
|
|
|
360
|
|
|
|
323
|
|
|
313
|
|
|
316
|
|
|
309
|
|
|
||||||||
Net interest income
|
2,345
|
|
|
2,345
|
|
|
2,258
|
|
|
2,160
|
|
|
|
2,130
|
|
|
2,095
|
|
|
2,068
|
|
|
2,098
|
|
|
||||||||
Noninterest income
|
1,915
|
|
|
1,780
|
|
|
1,802
|
|
|
1,724
|
|
|
|
1,744
|
|
|
1,734
|
|
|
1,726
|
|
|
1,567
|
|
|
||||||||
Total revenue
|
4,260
|
|
|
4,125
|
|
|
4,060
|
|
|
3,884
|
|
|
|
3,874
|
|
|
3,829
|
|
|
3,794
|
|
|
3,665
|
|
|
||||||||
Provision for credit losses
|
125
|
|
|
130
|
|
|
98
|
|
|
88
|
|
|
|
67
|
|
|
87
|
|
|
127
|
|
|
152
|
|
|
||||||||
Noninterest expense
|
3,061
|
|
|
2,456
|
|
|
2,479
|
|
|
2,402
|
|
|
|
2,441
|
|
|
2,394
|
|
|
2,360
|
|
|
2,281
|
|
|
||||||||
Income before income taxes (benefit) and
noncontrolling interests
|
1,074
|
|
|
1,539
|
|
|
1,483
|
|
|
1,394
|
|
|
|
1,366
|
|
|
1,348
|
|
|
1,307
|
|
|
1,232
|
|
|
||||||||
Income taxes (benefit) (a)
|
(1,017
|
)
|
|
413
|
|
|
386
|
|
|
320
|
|
|
|
319
|
|
|
342
|
|
|
318
|
|
|
289
|
|
|
||||||||
Net income
|
2,091
|
|
|
1,126
|
|
|
1,097
|
|
|
1,074
|
|
|
|
1,047
|
|
|
1,006
|
|
|
989
|
|
|
943
|
|
|
||||||||
Less: Net income attributable to noncontrolling interests
|
11
|
|
|
12
|
|
|
10
|
|
|
17
|
|
|
|
22
|
|
|
18
|
|
|
23
|
|
|
19
|
|
|
||||||||
Preferred stock dividends and discount accretion
and redemptions
|
57
|
|
|
64
|
|
|
57
|
|
|
84
|
|
|
|
43
|
|
|
64
|
|
|
43
|
|
|
65
|
|
|
||||||||
Net income attributable to common shareholders
|
$
|
2,023
|
|
|
$
|
1,050
|
|
|
$
|
1,030
|
|
|
$
|
973
|
|
|
|
$
|
982
|
|
|
$
|
924
|
|
|
$
|
923
|
|
|
$
|
859
|
|
|
Per Common Share Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Book value
|
$
|
91.94
|
|
|
$
|
89.05
|
|
|
$
|
87.78
|
|
|
$
|
86.14
|
|
|
|
$
|
85.94
|
|
|
$
|
86.57
|
|
|
$
|
85.33
|
|
|
$
|
83.47
|
|
|
Basic earnings from net income
|
$
|
4.23
|
|
|
$
|
2.18
|
|
|
$
|
2.12
|
|
|
$
|
1.99
|
|
|
|
$
|
2.01
|
|
|
$
|
1.87
|
|
|
$
|
1.84
|
|
|
$
|
1.70
|
|
|
Diluted earnings from net income
|
$
|
4.18
|
|
|
$
|
2.16
|
|
|
$
|
2.10
|
|
|
$
|
1.96
|
|
|
|
$
|
1.97
|
|
|
$
|
1.84
|
|
|
$
|
1.82
|
|
|
$
|
1.68
|
|
|
(a)
|
The fourth quarter 2017 results benefited from the new federal tax legislation. Certain tax legislation amounts are considered reasonable estimates as of December 31, 2017. See the Critical Accounting Estimates and Judgments section in Item 7 of this Report for additional details.
|
|
|
2017
|
|
2016
|
|
2015
|
|
|||||||||||||||||||||||||||
Taxable-equivalent basis
Dollars in millions
|
|
Average
Balances
|
|
|
Interest
Income/
Expense
|
|
|
Average
Yields/
Rates
|
|
|
Average
Balances
|
|
|
Interest
Income/
Expense
|
|
|
Average
Yields/
Rates
|
|
|
Average
Balances
|
|
|
Interest
Income/
Expense
|
|
|
Average
Yields/
Rates
|
|
|
||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Investment securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Securities available for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Agency
|
|
$
|
25,766
|
|
|
$
|
662
|
|
|
2.57
|
%
|
|
$
|
25,442
|
|
|
$
|
617
|
|
|
2.43
|
%
|
|
$
|
21,371
|
|
|
$
|
540
|
|
|
2.53
|
%
|
|
Non-agency
|
|
2,851
|
|
|
153
|
|
|
5.37
|
%
|
|
3,613
|
|
|
175
|
|
|
4.84
|
%
|
|
4,374
|
|
|
207
|
|
|
4.73
|
%
|
|
||||||
Commercial mortgage-backed
|
|
5,193
|
|
|
156
|
|
|
3.00
|
%
|
|
6,369
|
|
|
167
|
|
|
2.62
|
%
|
|
6,372
|
|
|
195
|
|
|
3.06
|
%
|
|
||||||
Asset-backed
|
|
5,681
|
|
|
147
|
|
|
2.59
|
%
|
|
5,741
|
|
|
132
|
|
|
2.30
|
%
|
|
5,234
|
|
|
111
|
|
|
2.12
|
%
|
|
||||||
U.S. Treasury and government agencies
|
|
13,178
|
|
|
235
|
|
|
1.78
|
%
|
|
10,590
|
|
|
155
|
|
|
1.46
|
%
|
|
6,486
|
|
|
79
|
|
|
1.22
|
%
|
|
||||||
Other
|
|
5,083
|
|
|
158
|
|
|
3.11
|
%
|
|
5,064
|
|
|
152
|
|
|
3.00
|
%
|
|
4,344
|
|
|
146
|
|
|
3.36
|
%
|
|
||||||
Total securities available for sale
|
|
57,752
|
|
|
1,511
|
|
|
2.62
|
%
|
|
56,819
|
|
|
1,398
|
|
|
2.46
|
%
|
|
48,181
|
|
|
1,278
|
|
|
2.65
|
%
|
|
||||||
Securities held to maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Residential mortgage-backed
|
|
13,049
|
|
|
364
|
|
|
2.79
|
%
|
|
10,529
|
|
|
290
|
|
|
2.75
|
%
|
|
8,238
|
|
|
251
|
|
|
3.05
|
%
|
|
||||||
Commercial mortgage-backed
|
|
1,255
|
|
|
51
|
|
|
4.06
|
%
|
|
1,693
|
|
|
62
|
|
|
3.66
|
%
|
|
1,976
|
|
|
75
|
|
|
3.80
|
%
|
|
||||||
Asset-backed
|
|
405
|
|
|
10
|
|
|
2.47
|
%
|
|
677
|
|
|
14
|
|
|
2.07
|
%
|
|
738
|
|
|
11
|
|
|
1.49
|
%
|
|
||||||
U.S. Treasury and government agencies
|
|
591
|
|
|
18
|
|
|
3.05
|
%
|
|
308
|
|
|
11
|
|
|
3.57
|
%
|
|
253
|
|
|
10
|
|
|
3.95
|
%
|
|
||||||
Other
|
|
2,005
|
|
|
105
|
|
|
5.24
|
%
|
|
2,020
|
|
|
114
|
|
|
5.64
|
%
|
|
2,279
|
|
|
119
|
|
|
5.22
|
%
|
|
||||||
Total securities held to maturity
|
|
17,305
|
|
|
548
|
|
|
3.17
|
%
|
|
15,227
|
|
|
491
|
|
|
3.22
|
%
|
|
13,484
|
|
|
466
|
|
|
3.46
|
%
|
|
||||||
Total investment securities
|
|
75,057
|
|
|
2,059
|
|
|
2.74
|
%
|
|
72,046
|
|
|
1,889
|
|
|
2.62
|
%
|
|
61,665
|
|
|
1,744
|
|
|
2.83
|
%
|
|
||||||
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Commercial
|
|
107,752
|
|
|
3,778
|
|
|
3.51
|
%
|
|
100,319
|
|
|
3,141
|
|
|
3.13
|
%
|
|
98,093
|
|
|
2,975
|
|
|
3.03
|
%
|
|
||||||
Commercial real estate
|
|
29,487
|
|
|
1,054
|
|
|
3.57
|
%
|
|
28,729
|
|
|
964
|
|
|
3.36
|
%
|
|
25,177
|
|
|
896
|
|
|
3.56
|
%
|
|
||||||
Equipment lease financing
|
|
7,618
|
|
|
248
|
|
|
3.26
|
%
|
|
7,463
|
|
|
266
|
|
|
3.56
|
%
|
|
7,570
|
|
|
260
|
|
|
3.43
|
%
|
|
||||||
Consumer
|
|
56,262
|
|
|
2,585
|
|
|
4.59
|
%
|
|
57,499
|
|
|
2,476
|
|
|
4.31
|
%
|
|
60,094
|
|
|
2,505
|
|
|
4.17
|
%
|
|
||||||
Residential real estate
|
|
16,152
|
|
|
725
|
|
|
4.49
|
%
|
|
14,807
|
|
|
696
|
|
|
4.70
|
%
|
|
14,415
|
|
|
697
|
|
|
4.84
|
%
|
|
||||||
Total loans
|
|
217,271
|
|
|
8,390
|
|
|
3.86
|
%
|
|
208,817
|
|
|
7,543
|
|
|
3.61
|
%
|
|
205,349
|
|
|
7,333
|
|
|
3.57
|
%
|
|
||||||
Interest-earning deposits with banks
|
|
24,043
|
|
|
267
|
|
|
1.11
|
%
|
|
26,328
|
|
|
136
|
|
|
.52
|
%
|
|
32,908
|
|
|
86
|
|
|
.26
|
%
|
|
||||||
Other interest-earning assets
|
|
8,983
|
|
|
313
|
|
|
3.48
|
%
|
|
7,843
|
|
|
279
|
|
|
3.56
|
%
|
|
8,903
|
|
|
356
|
|
|
4.00
|
%
|
|
||||||
Total interest-earning assets/interest income
|
|
325,354
|
|
|
11,029
|
|
|
3.39
|
%
|
|
315,034
|
|
|
9,847
|
|
|
3.13
|
%
|
|
308,825
|
|
|
9,519
|
|
|
3.08
|
%
|
|
||||||
Noninterest-earning assets
|
|
46,415
|
|
|
|
|
|
|
46,226
|
|
|
|
|
|
|
46,139
|
|
|
|
|
|
|
||||||||||||
Total assets
|
|
$
|
371,769
|
|
|
|
|
|
|
$
|
361,260
|
|
|
|
|
|
|
$
|
354,964
|
|
|
|
|
|
|
|||||||||
Liabilities and Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-bearing deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Money market
|
|
$
|
62,331
|
|
|
217
|
|
|
.35
|
%
|
|
$
|
71,530
|
|
|
146
|
|
|
.20
|
%
|
|
$
|
81,911
|
|
|
214
|
|
|
.26
|
%
|
|
|||
Demand
|
|
57,045
|
|
|
76
|
|
|
.13
|
%
|
|
52,701
|
|
|
40
|
|
|
.08
|
%
|
|
46,649
|
|
|
26
|
|
|
.06
|
%
|
|
||||||
Savings
|
|
42,749
|
|
|
197
|
|
|
.46
|
%
|
|
29,643
|
|
|
119
|
|
|
.40
|
%
|
|
14,719
|
|
|
32
|
|
|
.22
|
%
|
|
||||||
Time deposits
|
|
17,322
|
|
|
133
|
|
|
.77
|
%
|
|
18,890
|
|
|
125
|
|
|
.66
|
%
|
|
20,686
|
|
|
131
|
|
|
.63
|
%
|
|
||||||
Total interest-bearing deposits
|
|
179,447
|
|
|
623
|
|
|
.35
|
%
|
|
172,764
|
|
|
430
|
|
|
.25
|
%
|
|
163,965
|
|
|
403
|
|
|
.25
|
%
|
|
||||||
Borrowed funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Federal Home Loan Bank borrowings
|
|
19,890
|
|
|
261
|
|
|
1.31
|
%
|
|
18,385
|
|
|
155
|
|
|
.84
|
%
|
|
21,365
|
|
|
104
|
|
|
.49
|
%
|
|
||||||
Bank notes and senior debt
|
|
25,564
|
|
|
517
|
|
|
2.02
|
%
|
|
21,906
|
|
|
352
|
|
|
1.61
|
%
|
|
17,937
|
|
|
223
|
|
|
1.24
|
%
|
|
||||||
Subordinated debt
|
|
6,273
|
|
|
222
|
|
|
3.54
|
%
|
|
8,324
|
|
|
264
|
|
|
3.17
|
%
|
|
8,796
|
|
|
236
|
|
|
2.68
|
%
|
|
||||||
Other
|
|
5,162
|
|
|
83
|
|
|
1.61
|
%
|
|
4,324
|
|
|
60
|
|
|
1.39
|
%
|
|
8,415
|
|
|
79
|
|
|
.94
|
%
|
|
||||||
Total borrowed funds
|
|
56,889
|
|
|
1,083
|
|
|
1.90
|
%
|
|
52,939
|
|
|
831
|
|
|
1.57
|
%
|
|
56,513
|
|
|
642
|
|
|
1.14
|
%
|
|
||||||
Total interest-bearing liabilities/interest expense
|
|
236,336
|
|
|
1,706
|
|
|
.72
|
%
|
|
225,703
|
|
|
1,261
|
|
|
.56
|
%
|
|
220,478
|
|
|
1,045
|
|
|
.47
|
%
|
|
||||||
Noninterest-bearing liabilities and equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Noninterest-bearing deposits
|
|
78,634
|
|
|
|
|
|
|
78,085
|
|
|
|
|
|
|
76,398
|
|
|
|
|
|
|
||||||||||||
Accrued expenses and other liabilities
|
|
10,518
|
|
|
|
|
|
|
11,083
|
|
|
|
|
|
|
12,210
|
|
|
|
|
|
|
||||||||||||
Equity
|
|
46,281
|
|
|
|
|
|
|
46,389
|
|
|
|
|
|
|
45,878
|
|
|
|
|
|
|
||||||||||||
Total liabilities and equity
|
|
$
|
371,769
|
|
|
|
|
|
|
$
|
361,260
|
|
|
|
|
|
|
$
|
354,964
|
|
|
|
|
|
|
|||||||||
Interest rate spread
|
|
|
|
|
|
2.67
|
%
|
|
|
|
|
|
2.57
|
%
|
|
|
|
|
|
2.61
|
%
|
|
||||||||||||
Impact of noninterest-bearing sources
|
|
|
|
|
|
.20
|
|
|
|
|
|
|
.16
|
|
|
|
|
|
|
.13
|
|
|
||||||||||||
Net interest income/margin
|
|
|
|
$
|
9,323
|
|
|
2.87
|
%
|
|
|
|
$
|
8,586
|
|
|
2.73
|
%
|
|
|
|
$
|
8,474
|
|
|
2.74
|
%
|
|
(a)
|
Nonaccrual loans are included in loans, net of unearned income. The impact of financial derivatives used in interest rate risk management is included in the interest income/expense and average yields/rates of the related assets and liabilities. Basis adjustments related to hedged items are included in noninterest-earning assets and noninterest-bearing liabilities. Average balances of securities are based on amortized historical cost (excluding adjustments to fair value, which are included in other assets). Average balances for certain loans and borrowed funds accounted for at fair value, with changes in fair value recorded in Noninterest income, are included in noninterest-earning assets and noninterest-bearing liabilities.
|
(b)
|
Loan fees for the years ended
December 31,
2017
,
2016
and
2015
were $
126
million, $
137
million and $
106
million, respectively.
|
(c)
|
Interest income calculated as taxable-equivalent interest income. To provide more meaningful comparisons of interest income and yields for all interest-earning assets, as well as net interest margins, we use interest income on a taxable-equivalent basis in calculating average yields and net interest margin by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP. See Reconciliation of Taxable-Equivalent Net Interest Income in this Statistical Information section for more information.
|
|
|
2017/2016
|
|
|
2016/2015
|
|
||||||||||||||||||||
Taxable-equivalent basis
|
|
Increase/(Decrease) in Income/
Expense Due to Changes in:
|
|
|
Increase/(Decrease) in Income/
Expense Due to Changes in: |
|
||||||||||||||||||||
In millions
|
|
Volume
|
|
Rate
|
|
Total
|
|
|
Volume
|
|
Rate
|
|
Total
|
|
||||||||||||
Interest-Earning Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securities available for sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential mortgage-backed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
|
$
|
8
|
|
|
$
|
37
|
|
|
$
|
45
|
|
|
|
$
|
99
|
|
|
$
|
(22
|
)
|
|
$
|
77
|
|
|
Non-agency
|
|
$
|
(40
|
)
|
|
$
|
18
|
|
|
(22
|
)
|
|
|
$
|
(37
|
)
|
|
$
|
5
|
|
|
(32
|
)
|
|
||
Commercial mortgage-backed
|
|
$
|
(33
|
)
|
|
$
|
22
|
|
|
(11
|
)
|
|
|
|
|
$
|
(28
|
)
|
|
(28
|
)
|
|
||||
Asset-backed
|
|
$
|
(1
|
)
|
|
$
|
16
|
|
|
15
|
|
|
|
$
|
12
|
|
|
$
|
9
|
|
|
21
|
|
|
||
U.S. Treasury and government agencies
|
|
$
|
42
|
|
|
$
|
38
|
|
|
80
|
|
|
|
$
|
58
|
|
|
$
|
18
|
|
|
76
|
|
|
||
Other
|
|
$
|
1
|
|
|
$
|
5
|
|
|
6
|
|
|
|
$
|
23
|
|
|
$
|
(17
|
)
|
|
6
|
|
|
||
Total securities available for sale
|
|
$
|
23
|
|
|
$
|
90
|
|
|
113
|
|
|
|
$
|
217
|
|
|
$
|
(97
|
)
|
|
120
|
|
|
||
Securities held to maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential mortgage-backed
|
|
$
|
70
|
|
|
$
|
4
|
|
|
74
|
|
|
|
$
|
66
|
|
|
$
|
(27
|
)
|
|
39
|
|
|
||
Commercial mortgage-backed
|
|
$
|
(17
|
)
|
|
$
|
6
|
|
|
(11
|
)
|
|
|
$
|
(10
|
)
|
|
$
|
(3
|
)
|
|
(13
|
)
|
|
||
Asset-backed
|
|
$
|
(7
|
)
|
|
$
|
3
|
|
|
(4
|
)
|
|
|
$
|
(1
|
)
|
|
$
|
4
|
|
|
3
|
|
|
||
U.S. Treasury and government agencies
|
|
$
|
9
|
|
|
$
|
(2
|
)
|
|
7
|
|
|
|
$
|
2
|
|
|
$
|
(1
|
)
|
|
1
|
|
|
||
Other
|
|
$
|
(1
|
)
|
|
$
|
(8
|
)
|
|
(9
|
)
|
|
|
$
|
(15
|
)
|
|
$
|
10
|
|
|
(5
|
)
|
|
||
Total securities held to maturity
|
|
$
|
65
|
|
|
$
|
(8
|
)
|
|
57
|
|
|
|
$
|
58
|
|
|
$
|
(33
|
)
|
|
25
|
|
|
||
Total investment securities
|
|
$
|
81
|
|
|
$
|
89
|
|
|
170
|
|
|
|
$
|
280
|
|
|
$
|
(135
|
)
|
|
145
|
|
|
||
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial
|
|
$
|
242
|
|
|
$
|
395
|
|
|
637
|
|
|
|
$
|
67
|
|
|
$
|
99
|
|
|
166
|
|
|
||
Commercial real estate
|
|
$
|
26
|
|
|
$
|
64
|
|
|
90
|
|
|
|
$
|
120
|
|
|
$
|
(52
|
)
|
|
68
|
|
|
||
Equipment lease financing
|
|
$
|
6
|
|
|
$
|
(24
|
)
|
|
(18
|
)
|
|
|
$
|
(4
|
)
|
|
$
|
10
|
|
|
6
|
|
|
||
Consumer
|
|
$
|
(53
|
)
|
|
$
|
162
|
|
|
109
|
|
|
|
$
|
(111
|
)
|
|
$
|
82
|
|
|
(29
|
)
|
|
||
Residential real estate
|
|
$
|
61
|
|
|
$
|
(32
|
)
|
|
29
|
|
|
|
$
|
19
|
|
|
$
|
(20
|
)
|
|
(1
|
)
|
|
||
Total loans
|
|
$
|
312
|
|
|
$
|
535
|
|
|
847
|
|
|
|
$
|
126
|
|
|
$
|
84
|
|
|
210
|
|
|
||
Interest-earning deposits with banks
|
|
$
|
(13
|
)
|
|
$
|
144
|
|
|
131
|
|
|
|
$
|
(20
|
)
|
|
$
|
70
|
|
|
50
|
|
|
||
Other interest-earning assets
|
|
$
|
40
|
|
|
$
|
(6
|
)
|
|
34
|
|
|
|
$
|
(40
|
)
|
|
$
|
(37
|
)
|
|
(77
|
)
|
|
||
Total interest-earning assets
|
|
$
|
334
|
|
|
$
|
848
|
|
|
$
|
1,182
|
|
|
|
$
|
182
|
|
|
$
|
146
|
|
|
$
|
328
|
|
|
Interest-Bearing Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-bearing deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market
|
|
$
|
(21
|
)
|
|
$
|
92
|
|
|
$
|
71
|
|
|
|
$
|
(24
|
)
|
|
$
|
(44
|
)
|
|
$
|
(68
|
)
|
|
Demand
|
|
$
|
4
|
|
|
$
|
32
|
|
|
36
|
|
|
|
$
|
4
|
|
|
$
|
10
|
|
|
14
|
|
|
||
Savings
|
|
$
|
58
|
|
|
$
|
20
|
|
|
78
|
|
|
|
$
|
49
|
|
|
$
|
38
|
|
|
87
|
|
|
||
Time deposits
|
|
$
|
(11
|
)
|
|
$
|
19
|
|
|
8
|
|
|
|
$
|
(12
|
)
|
|
$
|
6
|
|
|
(6
|
)
|
|
||
Total interest-bearing deposits
|
|
$
|
17
|
|
|
$
|
176
|
|
|
193
|
|
|
|
$
|
27
|
|
|
|
|
27
|
|
|
||||
Borrowed funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Federal Home Loan Bank borrowings
|
|
$
|
14
|
|
|
$
|
92
|
|
|
106
|
|
|
|
$
|
(17
|
)
|
|
$
|
68
|
|
|
51
|
|
|
||
Bank notes and senior debt
|
|
$
|
65
|
|
|
$
|
100
|
|
|
165
|
|
|
|
$
|
55
|
|
|
$
|
74
|
|
|
129
|
|
|
||
Subordinated debt
|
|
$
|
(70
|
)
|
|
$
|
28
|
|
|
(42
|
)
|
|
|
$
|
(13
|
)
|
|
$
|
41
|
|
|
28
|
|
|
||
Other
|
|
$
|
13
|
|
|
$
|
10
|
|
|
23
|
|
|
|
$
|
(48
|
)
|
|
$
|
29
|
|
|
(19
|
)
|
|
||
Total borrowed funds
|
|
$
|
66
|
|
|
$
|
186
|
|
|
252
|
|
|
|
$
|
(43
|
)
|
|
$
|
232
|
|
|
189
|
|
|
||
Total interest-bearing liabilities
|
|
$
|
63
|
|
|
$
|
382
|
|
|
445
|
|
|
|
$
|
24
|
|
|
$
|
192
|
|
|
216
|
|
|
||
Change in net interest income
|
|
$
|
287
|
|
|
$
|
450
|
|
|
$
|
737
|
|
|
|
$
|
160
|
|
|
$
|
(48
|
)
|
|
$
|
112
|
|
|
(a)
|
Changes attributable to rate/volume are prorated into rate and volume components.
|
(b)
|
Interest income calculated as taxable-equivalent interest income. To provide more meaningful comparisons of interest income, we use interest income on a taxable-equivalent basis by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP. See Reconciliation of Taxable-Equivalent Net Interest Income in this Statistical Information section for more information.
|
In millions
|
|
Year ended December 31
|
|||||||||||||||||||
2017
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||||||
Net interest income (GAAP)
|
|
$
|
9,108
|
|
|
$
|
8,391
|
|
|
$
|
8,278
|
|
|
$
|
8,525
|
|
|
$
|
9,147
|
|
|
Taxable-equivalent adjustments
|
|
215
|
|
|
195
|
|
|
196
|
|
|
189
|
|
|
168
|
|
|
|||||
Net interest income (Non-GAAP)
|
|
$
|
9,323
|
|
|
$
|
8,586
|
|
|
$
|
8,474
|
|
|
$
|
8,714
|
|
|
$
|
9,315
|
|
|
(a)
|
The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest income, we use interest income on a taxable-equivalent basis by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable investments. This adjustment is not permitted under GAAP. As a result of the Tax Cuts and Jobs Act, which was enacted into law during the fourth quarter of 2017, the statutory tax rate for corporations was lowered to 21% from 35%, effective January 1, 2018. As such, beginning in 2018, our taxable-equivalent adjustments will be calculated using this lower statutory tax rate.
|
December 31 – in millions
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||||
Commercial lending
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
$
|
110,527
|
|
|
$
|
101,364
|
|
|
$
|
98,608
|
|
|
$
|
97,420
|
|
|
$
|
88,378
|
|
|
Commercial real estate
|
|
28,978
|
|
|
29,010
|
|
|
27,468
|
|
|
23,262
|
|
|
21,191
|
|
|
|||||
Equipment lease financing
|
|
7,934
|
|
|
7,581
|
|
|
7,468
|
|
|
7,686
|
|
|
7,576
|
|
|
|||||
Total commercial lending
|
|
147,439
|
|
|
137,955
|
|
|
133,544
|
|
|
128,368
|
|
|
117,145
|
|
|
|||||
Consumer lending
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity
|
|
28,364
|
|
|
29,949
|
|
|
32,133
|
|
|
34,677
|
|
|
36,447
|
|
|
|||||
Residential real estate
|
|
17,212
|
|
|
15,598
|
|
|
14,411
|
|
|
14,407
|
|
|
15,065
|
|
|
|||||
Credit card
|
|
5,699
|
|
|
5,282
|
|
|
4,862
|
|
|
4,612
|
|
|
4,425
|
|
|
|||||
Other consumer
|
|
21,744
|
|
|
22,049
|
|
|
21,746
|
|
|
22,753
|
|
|
22,531
|
|
|
|||||
Total consumer lending
|
|
73,019
|
|
|
72,878
|
|
|
73,152
|
|
|
76,449
|
|
|
78,468
|
|
|
|||||
Total loans
|
|
$
|
220,458
|
|
|
$
|
210,833
|
|
|
$
|
206,696
|
|
|
$
|
204,817
|
|
|
$
|
195,613
|
|
|
December 31
Dollars in millions, except per share data
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||||
Book value per common share
|
$
|
91.94
|
|
|
$
|
85.94
|
|
|
$
|
81.84
|
|
|
$
|
77.61
|
|
|
$
|
72.07
|
|
|
Tangible book value per common share
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Common shareholders’ equity
|
$
|
43,530
|
|
|
$
|
41,723
|
|
|
$
|
41,258
|
|
|
$
|
40,605
|
|
|
$
|
38,392
|
|
|
Goodwill and Other Intangible Assets
|
(9,498
|
)
|
|
(9,376
|
)
|
|
(9,482
|
)
|
|
(9,595
|
)
|
|
(9,654
|
)
|
|
|||||
Deferred tax liabilities on Goodwill and Other Intangible Assets
|
191
|
|
|
304
|
|
|
310
|
|
|
320
|
|
|
333
|
|
|
|||||
Tangible common shareholders’ equity
|
$
|
34,223
|
|
|
$
|
32,651
|
|
|
$
|
32,086
|
|
|
$
|
31,330
|
|
|
$
|
29,071
|
|
|
Period-end common shares outstanding (in millions)
|
473
|
|
|
485
|
|
|
504
|
|
|
523
|
|
|
533
|
|
|
|||||
Tangible book value per common share (Non-GAAP) (a)
|
$
|
72.28
|
|
|
$
|
67.26
|
|
|
$
|
63.65
|
|
|
$
|
59.88
|
|
|
$
|
54.57
|
|
|
(a)
|
We believe this non-GAAP financial measure serves as a useful tool to help evaluate the strength and discipline of a company’s capital management strategies and as an additional conservative measure of total company value.
|
Year ended December 31
Dollars in millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|||
Noninterest income
|
|
|
|
|
|
|
||||||
Asset management
|
$
|
1,942
|
|
|
$
|
1,521
|
|
|
$
|
1,567
|
|
|
Consumer services
|
1,415
|
|
|
1,388
|
|
|
1,335
|
|
|
|||
Corporate services
|
1,621
|
|
|
1,504
|
|
|
1,491
|
|
|
|||
Residential mortgage
|
350
|
|
|
567
|
|
|
566
|
|
|
|||
Service charges on deposits
|
695
|
|
|
667
|
|
|
651
|
|
|
|||
Total fee income
|
6,023
|
|
|
5,647
|
|
|
5,610
|
|
|
|||
Other
|
1,198
|
|
|
1,124
|
|
|
1,337
|
|
|
|||
Total noninterest income
|
$
|
7,221
|
|
|
$
|
6,771
|
|
|
$
|
6,947
|
|
|
December 31 – dollars in millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
|||||
Nonperforming loans
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
$
|
429
|
|
|
$
|
496
|
|
|
$
|
351
|
|
|
$
|
290
|
|
|
$
|
457
|
|
|
Commercial real estate
|
123
|
|
|
143
|
|
|
187
|
|
|
334
|
|
|
518
|
|
|
|||||
Equipment lease financing
|
2
|
|
|
16
|
|
|
7
|
|
|
2
|
|
|
5
|
|
|
|||||
Total commercial lending
|
554
|
|
|
655
|
|
|
545
|
|
|
626
|
|
|
980
|
|
|
|||||
Consumer lending (a)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity (b)
|
818
|
|
|
914
|
|
|
977
|
|
|
1,112
|
|
|
1,139
|
|
|
|||||
Residential real estate (b)
|
400
|
|
|
501
|
|
|
549
|
|
|
706
|
|
|
904
|
|
|
|||||
Credit card
|
6
|
|
|
4
|
|
|
3
|
|
|
3
|
|
|
4
|
|
|
|||||
Other consumer (b)
|
87
|
|
|
70
|
|
|
52
|
|
|
63
|
|
|
61
|
|
|
|||||
Total consumer lending
|
1,311
|
|
|
1,489
|
|
|
1,581
|
|
|
1,884
|
|
|
2,108
|
|
|
|||||
Total nonperforming loans (c)
|
1,865
|
|
|
2,144
|
|
|
2,126
|
|
|
2,510
|
|
|
3,088
|
|
|
|||||
OREO, foreclosed and other assets
|
170
|
|
|
230
|
|
|
299
|
|
|
370
|
|
|
369
|
|
|
|||||
Total nonperforming assets
|
$
|
2,035
|
|
|
$
|
2,374
|
|
|
$
|
2,425
|
|
|
$
|
2,880
|
|
|
$
|
3,457
|
|
|
Nonperforming loans to total loans
|
.85
|
%
|
|
1.02
|
%
|
|
1.03
|
%
|
|
1.23
|
%
|
|
1.58
|
%
|
|
|||||
Nonperforming assets to total loans, OREO, foreclosed and other assets
|
.92
|
%
|
|
1.12
|
%
|
|
1.17
|
%
|
|
1.40
|
%
|
|
1.76
|
%
|
|
|||||
Nonperforming assets to total assets
|
.53
|
%
|
|
.65
|
%
|
|
.68
|
%
|
|
.83
|
%
|
|
1.08
|
%
|
|
|||||
Interest on nonperforming loans (d)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Computed on original terms
|
$
|
114
|
|
|
$
|
111
|
|
|
$
|
115
|
|
|
$
|
125
|
|
|
$
|
163
|
|
|
Recognized prior to nonperforming status
|
$
|
19
|
|
|
$
|
21
|
|
|
$
|
22
|
|
|
$
|
25
|
|
|
$
|
30
|
|
|
Troubled Debt Restructurings
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Nonperforming
|
$
|
964
|
|
|
$
|
1,112
|
|
|
$
|
1,119
|
|
|
$
|
1,370
|
|
|
$
|
1,511
|
|
|
Performing
|
$
|
1,097
|
|
|
$
|
1,109
|
|
|
$
|
1,232
|
|
|
$
|
1,213
|
|
|
$
|
1,228
|
|
|
Past due loans
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accruing loans past due 90 days or more (e)
|
$
|
737
|
|
|
$
|
782
|
|
|
$
|
881
|
|
|
$
|
1,105
|
|
|
$
|
1,491
|
|
|
As a percentage of total loans
|
.33
|
%
|
|
.37
|
%
|
|
.43
|
%
|
|
.54
|
%
|
|
.76
|
%
|
|
|||||
Past due loans held for sale
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accruing loans held for sale past due 90 days or more
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
9
|
|
|
$
|
4
|
|
|
As a percentage of total loans held for sale
|
.11
|
%
|
|
.16
|
%
|
|
.29
|
%
|
|
.40
|
%
|
|
.18
|
%
|
|
(a)
|
Excludes most consumer loans and lines of credit, not secured by residential real estate, which are charged off after 120 to 180 days past due and are not placed on nonperforming status.
|
(b)
|
Pursuant to alignment with interagency supervisory guidance on practices for loans and lines of credit related to consumer lending in the first quarter of 2013, nonperforming home equity loans increased $214 million, nonperforming residential mortgage loans increased $187 million and nonperforming other consumer loans increased $25 million. Charge-offs were taken on these loans where the fair value less costs to sell the collateral was less than the recorded investment of the loan and were $134 million.
|
(c)
|
Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale, loans accounted for under the fair value option and purchased impaired loans.
|
(d)
|
Amounts are for the year ended.
|
(e)
|
Past due loan amounts include government insured or guaranteed consumer loans of $.6 billion, $.7 billion, $.8 billion, $1.0 billion and $1.0 billion at
December 31, 2017
,
2016
,
2015
,
2014
and
2013
, respectively.
|
Year ended December 31 – dollars in millions
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||||
Allowance for loan and lease losses – January 1
|
$
|
2,589
|
|
|
$
|
2,727
|
|
|
3,331
|
|
|
$
|
3,609
|
|
|
$
|
4,036
|
|
|
Gross charge-offs
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
(186
|
)
|
|
(332
|
)
|
|
(206
|
)
|
|
(276
|
)
|
|
(395
|
)
|
|||||
Commercial real estate
|
(24
|
)
|
|
(26
|
)
|
|
(44
|
)
|
|
(70
|
)
|
|
(203
|
)
|
|||||
Equipment lease financing
|
(11
|
)
|
|
(5
|
)
|
|
(5
|
)
|
|
(14
|
)
|
|
(8
|
)
|
|||||
Home equity
|
(123
|
)
|
|
(143
|
)
|
|
(181
|
)
|
|
(275
|
)
|
|
(486
|
)
|
|||||
Residential real estate
|
(9
|
)
|
|
(14
|
)
|
|
(24
|
)
|
|
(40
|
)
|
|
(133
|
)
|
|||||
Credit card
|
(182
|
)
|
|
(161
|
)
|
|
(160
|
)
|
|
(163
|
)
|
|
(178
|
)
|
|||||
Other consumer
|
(251
|
)
|
|
(205
|
)
|
|
(185
|
)
|
|
(183
|
)
|
|
(185
|
)
|
|||||
Total charge-offs
|
(786
|
)
|
|
(886
|
)
|
|
(805
|
)
|
|
(1,021
|
)
|
|
(1,588
|
)
|
|||||
Recoveries
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
81
|
|
|
117
|
|
|
170
|
|
|
207
|
|
|
248
|
|
|||||
Commercial real estate
|
28
|
|
|
51
|
|
|
66
|
|
|
84
|
|
|
93
|
|
|||||
Equipment lease financing
|
7
|
|
|
10
|
|
|
4
|
|
|
14
|
|
|
16
|
|
|||||
Home equity
|
91
|
|
|
84
|
|
|
93
|
|
|
78
|
|
|
73
|
|
|||||
Residential real estate
|
18
|
|
|
9
|
|
|
13
|
|
|
26
|
|
|
4
|
|
|||||
Credit card
|
21
|
|
|
19
|
|
|
21
|
|
|
21
|
|
|
22
|
|
|||||
Other consumer
|
83
|
|
|
53
|
|
|
52
|
|
|
60
|
|
|
55
|
|
|||||
Total recoveries
|
329
|
|
|
343
|
|
|
419
|
|
|
490
|
|
|
511
|
|
|||||
Net charge-offs
|
(457
|
)
|
|
(543
|
)
|
|
(386
|
)
|
|
(531
|
)
|
|
(1,077
|
)
|
|||||
Provision for credit losses
|
441
|
|
|
433
|
|
|
255
|
|
|
273
|
|
|
643
|
|
|||||
Net decrease / (increase) in allowance for unfunded loan commitments and letters of credit
|
4
|
|
|
(40
|
)
|
|
(2
|
)
|
|
(17
|
)
|
|
8
|
|
|||||
Other (a)
|
34
|
|
|
12
|
|
|
(471
|
)
|
|
(3
|
)
|
|
(1
|
)
|
|||||
Allowance for loan and lease losses – December 31
|
$
|
2,611
|
|
|
$
|
2,589
|
|
|
$
|
2,727
|
|
|
$
|
3,331
|
|
|
$
|
3,609
|
|
Allowance as a percentage of December 31:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans (a)
|
1.18
|
%
|
|
1.23
|
%
|
|
1.32
|
%
|
|
1.63
|
%
|
|
1.84
|
%
|
|||||
Nonperforming loans
|
140
|
%
|
|
121
|
%
|
|
128
|
%
|
|
133
|
%
|
|
117
|
%
|
|||||
As a percentage of average loans:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net charge-offs
|
.21
|
%
|
|
.26
|
%
|
|
.19
|
%
|
|
.27
|
%
|
|
.57
|
%
|
|||||
Provision for credit losses
|
.20
|
%
|
|
.21
|
%
|
|
.12
|
%
|
|
.14
|
%
|
|
.34
|
%
|
|||||
Allowance for loan and lease losses (a)
|
1.20
|
%
|
|
1.24
|
%
|
|
1.33
|
%
|
|
1.67
|
%
|
|
1.90
|
%
|
|||||
Allowance as a multiple of net charge-offs
|
5.71x
|
|
|
4.77x
|
|
|
7.06x
|
|
|
6.27x
|
|
|
3.35x
|
|
(a)
|
Includes $468 million in write-offs of purchased impaired loans in 2015 due to the change in derecognition policy effective
December 31, 2015
for certain consumer purchased impaired loans. See Note 1 Accounting Policies in our
2015
Form 10-K for additional information.
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
||||||||||||||||||||
December 31 Dollars in millions
|
Allowance
|
|
Loans to
Total Loans
|
|
|
Allowance
|
|
Loans to
Total Loans
|
|
|
Allowance
|
|
Loans to
Total Loans
|
|
|
Allowance
|
|
Loans to
Total Loans
|
|
|
Allowance
|
|
Loans to
Total Loans
|
|
|
|||||
Commercial
|
$
|
1,302
|
|
50.1
|
%
|
|
$
|
1,179
|
|
48.1
|
%
|
|
$
|
1,286
|
|
47.7
|
%
|
|
$
|
1,209
|
|
47.6
|
%
|
|
$
|
1,100
|
|
45.2
|
%
|
|
Commercial real estate
|
244
|
|
13.1
|
|
|
320
|
|
13.8
|
|
|
281
|
|
13.3
|
|
|
318
|
|
11.4
|
|
|
400
|
|
10.8
|
|
|
|||||
Equipment lease financing
|
36
|
|
3.6
|
|
|
35
|
|
3.6
|
|
|
38
|
|
3.6
|
|
|
44
|
|
3.7
|
|
|
47
|
|
3.9
|
|
|
|||||
Home equity
|
284
|
|
12.9
|
|
|
357
|
|
14.2
|
|
|
484
|
|
15.5
|
|
|
872
|
|
16.9
|
|
|
1,051
|
|
18.6
|
|
|
|||||
Residential real estate
|
300
|
|
7.8
|
|
|
332
|
|
7.4
|
|
|
307
|
|
7.0
|
|
|
561
|
|
7.0
|
|
|
642
|
|
7.7
|
|
|
|||||
Credit card
|
220
|
|
2.6
|
|
|
181
|
|
2.5
|
|
|
167
|
|
2.4
|
|
|
173
|
|
2.3
|
|
|
169
|
|
2.3
|
|
|
|||||
Other consumer
|
225
|
|
9.9
|
|
|
185
|
|
10.4
|
|
|
164
|
|
10.5
|
|
|
154
|
|
11.1
|
|
|
200
|
|
11.5
|
|
|
|||||
Total
|
$
|
2,611
|
|
100.0
|
%
|
|
$
|
2,589
|
|
100.0
|
%
|
|
$
|
2,727
|
|
100.0
|
%
|
|
$
|
3,331
|
|
100.0
|
%
|
|
$
|
3,609
|
|
100.0
|
%
|
|
December 31, 2017 - in billions
|
Domestic
Certificates
of Deposit
|
|
|
Three months or less
|
$
|
1.1
|
|
Over three through six months
|
1.4
|
|
|
Over six through twelve months
|
1.8
|
|
|
Over twelve months
|
1.8
|
|
|
Total
|
$
|
6.1
|
|
December 31, 2017
In millions |
1 Year or
Less
|
|
1 Through
5 Years
|
|
After
5 Years
|
|
Gross
Loans
|
|
||||
Commercial
|
$
|
27,922
|
|
$
|
73,299
|
|
$
|
9,306
|
|
$
|
110,527
|
|
Commercial real estate
|
8,418
|
|
14,741
|
|
5,819
|
|
28,978
|
|
||||
Total
|
$
|
36,340
|
|
$
|
88,040
|
|
$
|
15,125
|
|
$
|
139,505
|
|
Loans with:
|
|
|
|
|
||||||||
Predetermined rate
|
$
|
5,531
|
|
$
|
13,064
|
|
$
|
6,850
|
|
$
|
25,445
|
|
Floating or adjustable
rate
|
30,809
|
|
74,976
|
|
8,275
|
|
114,060
|
|
||||
Total
|
$
|
36,340
|
|
$
|
88,040
|
|
$
|
15,125
|
|
$
|
139,505
|
|
|
|
High
|
|
|
Low
|
|
|
Close
|
|
|
Cash
Dividends
Declared (a)
|
|
||||
2017 Quarter
|
|
|
|
|
|
|
|
|
||||||||
First
|
|
$
|
131.83
|
|
|
$
|
113.66
|
|
|
$
|
120.24
|
|
|
$
|
.55
|
|
Second
|
|
$
|
128.25
|
|
|
$
|
115.45
|
|
|
$
|
124.87
|
|
|
.55
|
|
|
Third
|
|
$
|
135.73
|
|
|
$
|
119.77
|
|
|
$
|
134.77
|
|
|
.75
|
|
|
Fourth
|
|
$
|
147.28
|
|
|
$
|
130.46
|
|
|
$
|
144.29
|
|
|
.75
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
$
|
2.60
|
|
|||
2016 Quarter
|
|
|
|
|
|
|
|
|
||||||||
First
|
|
$
|
94.26
|
|
|
$
|
77.67
|
|
|
$
|
84.57
|
|
|
$
|
.51
|
|
Second
|
|
$
|
90.85
|
|
|
$
|
77.40
|
|
|
$
|
81.39
|
|
|
.51
|
|
|
Third
|
|
$
|
91.39
|
|
|
$
|
77.86
|
|
|
$
|
90.09
|
|
|
.55
|
|
|
Fourth
|
|
$
|
118.57
|
|
|
$
|
87.34
|
|
|
$
|
116.96
|
|
|
.55
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
$
|
2.12
|
|
(a)
|
Our Board of Directors approved a first quarter 2018 cash dividend of $.75 per common share, which was payable on February 5, 2018.
|
|
Transitional Basel III
|
|
|
|
Pro forma Fully Phased-In Basel III (Non-GAAP)
(estimated) (a) (b)
|
||||||||||||||||||||||
Dollars in millions
|
December 31
2016 |
|
|
December 31
2015 |
|
|
December 31, 2014
|
|
|
December 31
2016 |
|
|
December 31
2015 |
|
|
December 31
2014 |
|
|
December 31
2013 |
|
|||||||
Common stock, related surplus and retained
earnings, net of treasury stock
|
$
|
41,987
|
|
|
$
|
41,128
|
|
|
$
|
40,103
|
|
|
$
|
41,987
|
|
|
$
|
41,128
|
|
|
$
|
40,103
|
|
|
$
|
38,031
|
|
Less regulatory capital adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Goodwill and disallowed intangibles, net
of deferred tax liabilities
|
(8,974
|
)
|
|
(8,972
|
)
|
|
(8,939
|
)
|
|
(9,073
|
)
|
|
(9,172
|
)
|
|
(9,276
|
)
|
|
(9,321
|
)
|
|||||||
Basel III total threshold deductions
|
(762
|
)
|
|
(470
|
)
|
|
(212
|
)
|
|
(1,469
|
)
|
|
(1,294
|
)
|
|
(1,081
|
)
|
|
(1,386
|
)
|
|||||||
Accumulated other comprehensive
income (c)
|
(238
|
)
|
|
(81
|
)
|
|
40
|
|
|
(396
|
)
|
|
(201
|
)
|
|
201
|
|
|
196
|
|
|||||||
All other adjustments
|
(214
|
)
|
|
(112
|
)
|
|
(63
|
)
|
|
(221
|
)
|
|
(182
|
)
|
|
(121
|
)
|
|
(64
|
)
|
|||||||
Basel III Common equity Tier 1 capital
|
$
|
31,799
|
|
|
$
|
31,493
|
|
|
$
|
30,929
|
|
|
$
|
30,828
|
|
|
$
|
30,279
|
|
|
$
|
29,826
|
|
|
$
|
27,456
|
|
Basel III standardized approach
risk-weighted assets (d)
|
$
|
300,533
|
|
|
$
|
295,905
|
|
|
$
|
284,018
|
|
|
$
|
308,517
|
|
|
$
|
303,707
|
|
|
$
|
298,786
|
|
|
$
|
291,977
|
|
Basel III advanced approaches risk-weighted
assets (e)
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
$
|
277,896
|
|
|
$
|
264,931
|
|
|
$
|
285,870
|
|
|
$
|
290,080
|
|
|||
Basel III Common equity Tier 1 capital ratio
|
10.6
|
%
|
|
10.6
|
%
|
|
10.9
|
%
|
|
10.0
|
%
|
|
10.0
|
%
|
|
10.0
|
%
|
|
9.4
|
%
|
|||||||
Risk weight and associated rules utilized
|
Standardized
(with 2016 transition adjustments) |
|
Standardized
(with 2015 transition adjustments) |
|
Standardized
(with 2014 transition adjustments) |
|
Standardized
|
(a)
|
We utilize the pro forma fully phased-in Basel III capital ratios, to assess our capital position (without the benefit of phase-ins), as these ratios represent the regulatory capital standards that may ultimately be applicable to us under the final Basel III rules.
|
(b)
|
Basel III capital ratios and estimates may be impacted by additional regulatory guidance or analysis, and, in the case of those ratios calculated using the advanced approaches, may be subject to variability based on the ongoing evolution, validation and regulatory approval of our models that are integral to the calculation of advanced approaches risk-weighted assets.
|
(c)
|
Represents net adjustments related to accumulated other comprehensive income for securities currently and those transferred from available for sale, as well as pension and other postretirement plans.
|
(d)
|
Basel III standardized approach risk-weighted assets are based on the Basel III standardized approach rules and include credit and market risk-weighted assets.
|
(e)
|
Basel III advanced approaches risk-weighted assets are based on the Basel III advanced approaches rules, and include credit, market and operational risk-weighted assets. During the parallel run qualification phase we have refined the data, models and internal processes used as part of the advanced approaches for determining risk-weighted assets. Refinements implemented in the fourth quarter of 2015 reduced estimated Basel III advanced approaches risk-weighted assets. We anticipate additional refinements to this estimate through the parallel run qualification phase.
|
Dollars in millions
|
|
December 31
2013 |
|
|
Basel I Tier 1 common capital
|
|
$
|
28,484
|
|
Basel I risk-weighted assets
|
|
$
|
272,169
|
|
Basel I Tier 1 common capital ratio
|
|
10.5
|
%
|
(a)
|
Effective January 1, 2014, the Basel I Tier 1 common capital ratio no longer applies to us (except for stress testing purposes). Our 2013 Form 10-K included additional information regarding our Basel I capital ratios.
|
(b)
|
Amounts have not been updated to reflect the first quarter 2014 adoption of ASU 2014-01 related to investments in low income housing tax credits.
|
|
|
(a)
|
|
|
(b)
|
|
|
(c)
|
|
|
|
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
|
|
Weighted-average exercise price of outstanding options, warrants and rights (1)
|
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
|
|
|
Plan Category
|
|
|
|
|
|
|
|
||||
Equity compensation plans approved by security holders
|
|
6,185,160
|
|
(2)
|
$
|
58.02
|
|
|
36,547,360
|
|
(3)
|
Equity compensation plans not approved by security holders
|
|
24,706
|
|
(4)
|
$
|
136.23
|
|
|
|
|
|
Total
|
|
6,209,866
|
|
|
$
|
59.48
|
|
|
36,547,360
|
|
|
Exhibit
No.
|
|
Description
|
|
Method of Filing +
|
|
|
|
||
3.1.1
|
|
|
Incorporated herein by reference to Exhibit 3.1 of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2008 (2008 Form 10-K)
|
|
|
|
|
||
3.1.2
|
|
|
Incorporated herein by reference to Exhibit 3.1 of the Corporation’s Current Report on Form 8-K filed July 27, 2011
|
|
|
|
|
||
3.1.3
|
|
|
Incorporated herein by reference to Exhibit 3.1 of the Corporation’s Current Report on Form 8-K filed April 24, 2012
|
|
|
|
|
||
3.1.4
|
|
|
Incorporated herein by reference to Exhibit 3.1 of the Corporation’s Current Report on Form 8-K filed September 21, 2012
|
|
|
|
|
||
3.1.5
|
|
|
Incorporated herein by reference to Exhibit 3.1 of the Corporation’s Current Report on Form 8-K filed May 7, 2013
|
|
|
|
|
||
3.1.6
|
|
|
Incorporated herein by reference to Exhibit 3.1.6 of the Corporation’s Current Report on Form 8-K filed November 20, 2015
|
|
|
|
|
||
3.1.7
|
|
|
Incorporated herein by reference to Exhibit 3.1 of the Corporation’s Current Report on Form 8-K filed November 1, 2016
|
|
|
|
|
||
3.2
|
|
|
Incorporated herein by reference to Exhibit 3.2 of the Corporation’s Current Report on Form 8-K filed August 11, 2016
|
|
|
|
|
||
4.1
|
|
There are no instruments with respect to long-term debt of the Corporation and its subsidiaries that involve a total amount of securities authorized thereunder that exceed 10 percent of the total assets of the Corporation and its subsidiaries on a consolidated basis. The Corporation agrees to provide the SEC with a copy of instruments defining the rights of holders of long-term debt of the Corporation and its subsidiaries on request.
|
|
|
|
|
|
||
4.2
|
|
|
Incorporated herein by reference to Exhibit 4.2 (included as part of Exhibit 4.1) of the Corporation’s Form 8-A filed April 30, 2010
|
|
|
|
|
||
4.3
|
|
|
Incorporated herein by reference to Exhibit 4.2 of the Corporation’s Current Report on Form 8-K filed July 27, 2011
|
|
|
|
|
4.4
|
|
|
Incorporated herein by reference to Exhibit 4.2 of the Corporation’s Current Report on Form 8-K filed April 24, 2012
|
|
|
|
|
||
4.5
|
|
|
Incorporated herein by reference to Exhibit 4.2 of the Corporation’s Current Report on Form 8-K filed September 21, 2012
|
|
|
|
|
||
4.6
|
|
|
Incorporated herein by reference to Exhibit 4.2 of the Corporation’s Current Report on Form 8-K filed May 7, 2013
|
|
|
|
|
||
4.7
|
|
|
Incorporated herein by reference to Exhibit 4.2 of the Corporation’s Current Report on Form 8-K filed November 1, 2016
|
|
|
|
|
||
4.8
|
|
|
Incorporated herein by reference to Exhibit 4.11 of the Corporation’s 3rd Quarter 2004 Form 10-Q
|
|
|
|
|
||
4.9.1
|
|
|
Incorporated herein by reference to Exhibit 4.25 of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2013 (2013 Form 10-K)
|
|
|
|
|
||
4.9.2
|
|
|
Incorporated herein by reference to Exhibit 4.21.2 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 (2nd Quarter 2015 Form 10-Q)
|
|
|
|
|
||
4.9.3
|
|
|
Incorporated herein by reference to Exhibit 4.20.3 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016 (2nd Quarter 2016 Form 10-Q)
|
|
|
|
|
||
4.10
|
|
|
Incorporated herein by reference to Exhibit 4.25 of the Corporation’s 2013 Form 10-K
|
|
|
|
|
||
4.11
|
|
|
Incorporated herein by reference to Exhibit 4.21.2 of the Corporation’s 2nd Quarter 2015 Form 10-Q
|
|
|
|
|
||
10.1.1
|
|
|
Incorporated herein by reference to Exhibit 10.2 of the Corporation’s 2008 Form 10-K*
|
|
|
|
|
||
10.1.2
|
|
|
Incorporated herein by reference to Exhibit 10.3 of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2009 (2009 Form 10-K)*
|
|
|
|
|
||
10.1.3
|
|
|
Incorporated herein by reference to Exhibit 10.1.3 of the Corporation’s 2013 Form 10-K*
|
|
|
|
|
||
10.2.1
|
|
|
Incorporated herein by reference to Exhibit 10.4 of the Corporation’s 2008 Form 10-K*
|
|
|
|
|
||
10.2.2
|
|
|
Incorporated herein by reference to Exhibit 10.6 of the Corporation’s 2009 Form 10-K*
|
|
|
|
|
10.2.3
|
|
|
Incorporated herein by reference to Exhibit 10.8 of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011 (2011 Form 10-K)*
|
|
|
|
|
||
10.2.4
|
|
|
Incorporated herein by reference to Exhibit 10.2.4 of the Corporation’s 2013 Form 10-K*
|
|
|
|
|
||
10.3.1
|
|
|
Incorporated herein by reference to Exhibit 10.6 of the Corporation’s 2008 Form 10-K*
|
|
|
|
|
||
10.3.2
|
|
|
Incorporated herein by reference to Exhibit 10.9 of the Corporation’s 2009 Form 10-K*
|
|
|
|
|
||
10.4.1
|
|
|
Incorporated herein by reference to Exhibit 10.17 of the Corporation’s 2011 Form 10-K*
|
|
|
|
|
||
10.4.2
|
|
|
Incorporated herein by reference to Exhibit 10.4.2 of the Corporation’s 2013 Form 10-K*
|
|
|
|
|
||
10.5.1
|
|
|
Incorporated herein by reference to Exhibit 10.62 of the Corporation’s 2nd Quarter 2009 Form 10-Q*
|
|
|
|
|
||
10.5.2
|
|
|
Incorporated herein by reference to Exhibit 10.17 of the Corporation’s 2009 Form 10-K*
|
|
|
|
|
||
10.5.3
|
|
|
Incorporated herein by reference to Exhibit 10.20 of the Corporation’s 2010 Form 10-K*
|
|
|
|
|
||
10.5.4
|
|
|
Incorporated herein by reference to Exhibit 10.23 of the Corporation’s 2011 Form 10-K*
|
|
|
|
|
||
10.5.5
|
|
|
Incorporated herein by reference to Exhibit 10.24 of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2012 (2012 Form 10-K)*
|
|
|
|
|
||
10.5.6
|
|
|
Incorporated herein by reference to Exhibit 10.5.6 of the Corporation’s 2013 Form 10-K*
|
|
|
|
|
||
10.6
|
|
|
Incorporated herein by reference to Exhibit 10.7 of the Corporation’s Form 10-K for the year ended December 31, 2016 (2016 Form 10-K)*
|
|
|
|
|
||
10.7
|
|
|
Incorporated herein by reference to Exhibit 99.1 of the Corporation’s Form S-8 (File No. 333-210995) filed April 29, 2016*
|
|
|
|
|
||
10.8.1
|
|
|
Incorporated herein by reference to Exhibit 10.70 of the Corporation’s Quarterly Report on Form 1O-Q for the quarter ended March 31, 2011 (1st Quarter 2011 Form 10-Q)*
|
|
|
|
|
||
10.8.2
|
|
|
Incorporated herein by reference to Exhibit 10.28 of the Corporation’s 2011 Form 10-K*
|
|
|
|
|
||
10.9
|
|
|
Incorporated herein by reference to Exhibit 10.55 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017*
|
|
|
|
|
||
10.10
|
|
|
Incorporated herein by reference to Exhibit 10.32 of the Corporation’s 2011 Form 10-K*
|
|
|
|
|
||
10.11
|
|
|
Incorporated herein by reference to Exhibit 10.52 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 (3rd Quarter 2014 10-Q)*
|
|
|
|
|
10.12
|
|
|
Incorporated herein by reference to Exhibit 10.34 of the Corporation’s 2011 Form 10-K*
|
|
|
|
|
||
10.13
|
|
|
Incorporated herein by reference to Exhibit 10.53 of the Corporation’s 3rd Quarter 2014 10-Q*
|
|
|
|
|
||
10.14
|
|
|
Incorporated herein by reference to Exhibit 10.16 of the Corporation’s 2016 Form 10-K*
|
|
|
|
|
||
10.15
|
|
|
Filed herewith*
|
|
|
|
|
||
10.16
|
|
|
Incorporated herein by reference to Exhibit 10.34 of the Corporation’s 3rd Quarter 2005 Form 10-Q*
|
|
|
|
|
||
10.17
|
|
|
Incorporated herein by reference to Exhibit 10.37 of the Corporation’s 2011 Form 10-K*
|
|
|
|
|
||
10.18
|
|
|
Incorporated herein by reference to Exhibit 10.16 of the Corporation’s 2013 Form 10-K
|
|
|
|
|
||
10.19
|
|
|
Incorporated herein by reference to the employee stock option and restricted share units agreements portions of Exhibit 10.26 of the Corporation’s 2007 Form 10-K*
|
|
|
|
|
||
10.20
|
|
|
Incorporated herein by reference to Exhibit 10.50 of the Corporation’s Current Report on Form 8-K filed April 18, 2008*
|
|
|
|
|
||
10.21
|
|
|
Incorporated herein by reference to Exhibit 10.51 of the Corporation’s Current Report on Form 8-K filed April 18, 2008*
|
|
|
|
|
||
10.22
|
|
|
Incorporated herein by reference to Exhibit 10.54 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008*
|
|
|
|
|
||
10.23
|
|
|
Incorporated by reference to the employee stock option, restricted stock and restricted share unit agreements portions of Exhibit 10.61 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009*
|
|
|
|
|
||
10.24
|
|
|
Incorporated herein by reference to Exhibit 10.48 of the Corporation’s 2009 Form 10-K*
|
|
|
|
|
||
10.25
|
|
|
Incorporated herein by reference to Exhibit 10.71 of the Corporation’s 1st Quarter 2011 Form 10-Q*
|
|
|
|
|
||
10.26
|
|
|
Incorporated herein by reference to Exhibit 10.77 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 (1st Quarter 2012 Form 10-Q)*
|
|
|
|
|
||
10.27
|
|
|
Incorporated herein by reference to Exhibit 10.78 of the Corporation’s 1st Quarter 2012 Form 10-Q*
|
|
|
|
|
||
10.28
|
|
|
Incorporated herein by reference to Exhibit 10.79 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 (2nd Quarter 2012 Form 10-Q)*
|
|
|
|
|
||
10.29
|
|
|
Incorporated herein by reference to Exhibit 10.64 of the Corporation’s 2012 Form 10-K*
|
|
|
|
|
||
10.30
|
|
|
Incorporated herein by reference to Exhibit 10.82 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013*
|
|
|
|
|
10.31
|
|
|
Incorporated by reference to Exhibit 10.83 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013*
|
|
|
|
|
||
10.32
|
|
|
Incorporated by reference to Exhibit 10.36 of the Corporation’s 2013 Form 10-K*
|
|
|
|
|
||
10.33
|
|
|
Incorporated herein by reference to Exhibit 10.50 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014*
|
|
|
|
|
||
10.34
|
|
|
Incorporated herein by reference to Exhibit 10.51 of the Corporation’s 3rd Quarter 2014 10-Q*
|
|
|
|
|
||
10.35
|
|
|
Incorporated herein by reference to Exhibit 10.50 of the Corporation’s 2nd Quarter 2015 Form 10-Q*
|
|
|
|
|
||
10.36
|
|
|
Incorporated herein by reference to Exhibit 10.51 of the Corporation’s 2nd Quarter 2015 Form 10-Q*
|
|
|
|
|
||
10.37
|
|
|
Incorporated herein by reference to Exhibit 10.52 of the Corporation’s 2nd Quarter 2015 Form 10-Q*
|
|
|
|
|
||
10.38
|
|
|
Incorporated herein by reference to Exhibit 10.52 of the Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 (3rd Quarter 2016 Form 10-Q)*
|
|
|
|
|
||
10.39
|
|
|
Incorporated herein by reference to Exhibit 10.53 of the Corporation’s 3rd Quarter 2016 Form 10-Q*
|
|
|
|
|
||
10.40
|
|
|
Incorporated herein by reference to Exhibit 10.54 of the Corporation’s 3rd Quarter 2016 Form 10-Q*
|
|
|
|
|
||
10.41
|
|
|
Incorporated herein by reference to Exhibit 10.55 of the Corporation’s 3rd Quarter 2016 Form 10-Q*
|
|
|
|
|
||
10.42
|
|
|
Incorporated by reference to Exhibit 10.49 of the Corporation’s Current Report on Form 8-K filed April 4, 2014*
|
|
|
|
|
||
10.43
|
|
|
Incorporated herein by reference to Exhibit 10.51 of the Corporation’s Current Report on Form 8-K filed August 16, 2016*
|
|
|
|
|
||
10.44.1
|
|
|
Incorporated herein by reference to Exhibit 10.35 of National City Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006*
|
|
|
|
|
||
10.44.2
|
|
|
Incorporated herein by reference to Exhibit 10.56 of the Corporation’s 2010 Form 10-K*
|
|
|
|
|
||
10.45.1
|
|
|
Incorporated herein by reference to Exhibit 10.22 of the Quarterly Report on Form 10-Q of BlackRock Holdco 2, Inc. (Commission File No. 001-15305) (referred to herein as Old BlackRock) for the quarter ended September 30, 2002 (Old BlackRock 3rd Quarter 2002 Form 10-Q)
|
|
|
|
|
||
10.45.2
|
|
|
Incorporated herein by reference to Exhibit 10.3 of the Current Report on Form 8-K of Old BlackRock (Commission File No. 001-15305) filed February 22, 2006 (Old BlackRock February 22, 2006 Form 8-K)
|
|
|
|
|
||
10.45.3
|
|
|
Incorporated herein by reference to Exhibit 10.50 of the Corporation’s Current Report on Form 8-K filed June 14, 2007
|
|
|
|
|
||
10.45.4
|
|
|
Incorporated herein by reference to Exhibit 10.3 of BlackRock, Inc.’s Current Report on Form 8-K filed February 27, 2009
|
|
|
|
|
10.45.5
|
|
|
Incorporated herein by reference to Exhibit 10.1 of BlackRock, Inc.’s Form 10-Q for the quarter ended June 30, 2012
|
|
|
|
|
||
10.46.1
|
|
|
Incorporated herein by reference to Exhibit 10.2 of BlackRock, Inc.’s Current Report on Form 8-K filed February 27, 2009
|
|
|
|
|
||
10.46.2
|
|
|
Incorporated herein by reference to Exhibit 10.2 of BlackRock, Inc.’s Current Report on Form 8-K filed June 17, 2009
|
|
|
|
|
||
10.47
|
|
|
Incorporated herein by reference to Exhibit 10.3 of BlackRock, Inc.’s Current Report on Form 8-K filed May 23, 2012
|
|
|
|
|
||
10.48.1
|
|
|
Incorporated by reference to Exhibit 10.47 of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2014
|
|
|
|
|
||
10.48.2
|
|
|
Incorporated herein by reference to Exhibit 10.47.2 of the Corporation’s 2nd Quarter 2015 Form 10-Q
|
|
|
|
|
||
10.48.3
|
|
|
Incorporated herein by reference to Exhibit 10.48.3 of the Corporation’s 2nd Quarter 2016 Form 10-Q
|
|
|
|
|
||
10.49
|
|
|
Incorporated herein by reference to Exhibit 2.1 of the Corporation’s Current Report on Form 8-K filed February 3, 2010
|
|
|
|
|
||
12.1
|
|
|
Filed herewith
|
|
|
|
|
||
12.2
|
|
|
Filed herewith
|
|
|
|
|
||
21
|
|
|
Filed herewith
|
|
|
|
|
||
23.1
|
|
|
Filed herewith
|
|
|
|
|
||
23.2
|
|
|
Filed herewith
|
|
|
|
|
||
24
|
|
|
Filed herewith
|
|
|
|
|
||
31.1
|
|
|
Filed herewith
|
|
|
|
|
||
31.2
|
|
|
Filed herewith
|
|
|
|
|
||
32.1
|
|
|
Filed herewith
|
|
|
|
|
||
32.2
|
|
|
Filed herewith
|
|
|
|
|
||
99.1
|
|
|
Filed herewith
|
|
|
|
|
99.2
|
|
|
Incorporated herein by reference to Exhibit 99.1 of the Corporation’s Current Report on Form 8-K filed April 14, 2011
|
|
|
|
|
||
101
|
|
Interactive Data File (XBRL)
|
|
Filed herewith
|
+
|
Incorporated document references to filings by the Corporation are to SEC File No. 001-09718, to filings by National City Corporation are to SEC File No. 001-10074, to filings by BlackRock through its second quarter 2006 Form 10-Q (referred to herein as Old BlackRock) are to BlackRock Holdco 2, Inc. SEC File No. 001-15305, and to filings by BlackRock, Inc. are to SEC File No. 001-33099.
|
*
|
Denotes management contract or compensatory plan.
|
|
|
|
By:
|
|
/s/ Robert Q. Reilly
|
|
|
Robert Q. Reilly
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
February 28, 2018
|
|
|
|
Signature
|
|
Capacities
|
|
|
|
/s/ William S. Demchak
|
|
Chairman, President, Chief Executive Officer and Director
|
William S. Demchak
|
|
(Principal Executive Officer)
|
|
|
|
/s/ Robert Q. Reilly
|
|
Executive Vice President and Chief Financial Officer
|
Robert Q. Reilly
|
|
(Principal Financial Officer)
|
|
|
|
/s/ Gregory H. Kozich
|
|
Senior Vice President and Controller
|
Gregory H. Kozich
|
|
(Principal Accounting Officer)
|
|
|
|
* Charles E. Bunch; Debra A. Cafaro; Marjorie Rodgers Cheshire; Andrew T. Feldstein; Daniel R. Hesse; Richard B. Kelson; Linda R. Medler, Jane G. Pepper; Martin Pfinsgraff; Donald J. Shepard; Lorene K. Steffes; Dennis F. Strigl; Michael J. Ward; Gregory D. Wasson
|
|
Directors
|
|
|
|
*By:
|
|
/s/ Christi Davis
|
|
|
Christi Davis, Attorney-in-Fact,
pursuant to Powers of Attorney filed herewith
|
(a)
|
The Company has caused the Former Trustee to transfer all assets held in the Trust to the Trustee, which shall become the principal of the Trust to be held, administered and disposed of by Trustee as provided in this Trust Agreement.
|
(b)
|
The Trust hereby established shall be revocable by Company; it shall become irrevocable upon a Change in Control, as defined herein
.
|
(c)
|
The Trust is intended to continue to be a grantor trust, of which Company is the grantor, within the meaning of subpart E, part I subchapter J, chapter 1, subtitle A of the Internal Revenue Code of 1986, as amended, and shall be construed accordingly.
|
(d)
|
The principal of the Trust, and any earnings thereon, shall be held separate and apart from other funds of Company and shall be used exclusively for the uses and purposes of Plan participants and general creditors as herein set forth. Plan participants and their beneficiaries shall have no preferred claim on, or any beneficial ownership interest in, any assets of the Trust. Any rights created under the Plan and this Trust Agreement shall be mere unsecured contractual rights of Plan participants and their beneficiaries against Company. Any assets held by the Trust will be subject to the claims of Company's general creditors under federal and state law in the event of Insolvency, as defined in Section 3(a) herein.
|
(e)
|
Upon a Change in Control, Company shall make an irrevocable contribution to the Trust in an amount that is sufficient to pay each Plan participant or beneficiary the benefits to which Plan participants or their beneficiaries would be entitled pursuant to the terms of the Plan as of the date on which the Change in Control occurred.
|
(f)
|
The administration of the Trust shall be subject to all of the terms and conditions of the Operational Guidelines attached hereto as
Appendix B
, which are hereby incorporated by reference. Notwithstanding anything to the contrary set forth in this Agreement, the Trustee may amend the Operational Guidelines at any time upon written notice to the Company.
|
(a)
|
Company may (i) make all payments directly to the Plan participants and their beneficiaries in accordance with the terms of the Plan and (ii) make provisions for the reporting and withholding of any federal, state or local taxes that may be required to be withheld with respect to the payment of benefits pursuant to the terms of the Plan and shall pay amounts withheld to the appropriate taxing authorities. For the avoidance of doubt, the Trustee shall have no duties with respect to the provisions of this Section 2, subsection (a) to the extent Company performs such duties. The Company may request reimbursement for payments made pursuant to this Section 2, subsection (a) as set forth in Section 4 below.
|
(b)
|
The Company shall deliver to the Trustee a schedule (the “
Payment Schedule
”) that indicates the amounts payable with respect to each Plan participant (and his or her beneficiaries), that provides a formula or other instructions acceptable to the Trustee for determining the amounts so payable, the form in which such amount is to be paid (as provided for or available under the Plan), and the time of commencement for payment of such amounts. Should the Company elect not to proceed as set forth in Section 2, subsection (a), and except as otherwise provided herein, the Trustee shall make payments to the Plan participants and their beneficiaries in accordance with such Payment Schedule. With respect to payments made directly by the Trustee, the Trustee shall make provisions for the reporting and withholding of any federal or state taxes that may be required to be withheld with respect to the payment of benefits pursuant to the terms of the Plan and shall pay amounts withheld to the appropriate taxing authorities or determine that such amounts have been reported, withheld and paid by the Company. In order to facilitate payment of taxes with respect to Plan payments made directly by the Trustee, the Trustee may transfer cash to any service provider, including a payroll agent, retained and designated by the Company to remit and report required taxes thereon (including federal, state and local taxes). Such paying agent services may be provided by Company at no cost to the Trust, and in the event the Company provides such services, the Trustee shall transfer cash to the Company not as a reversion of Trust assets to the
|
(c)
|
The entitlement of a Plan participant or his or her beneficiaries to benefits under the Plan shall be determined by Company or such party as it shall designate under the Plan, and any claim for such benefits shall be considered and reviewed under the procedures set out in the Plan.
|
(d)
|
As set forth in Section 2, subsection (a) above, Company may make payment of benefits directly to Plan participants or their beneficiaries as they become due under the terms of the Plan. Company shall notify Trustee of its decision to make payment of benefits directly prior to the time amounts are payable to participants or their beneficiaries. In addition, if the principal of the Trust, and any earning thereon, are not sufficient to make payments of benefits in accordance with the terms of the Plan as indicated to the Trustee on the Payment Schedule, Company shall make the balance of each such payment as it falls due.
|
(a)
|
Trustee shall cease payment of benefits to Plan participants and their beneficiaries if the Company is Insolvent. Company shall be considered "
Insolvent
" for purposes of this Trust Agreement if (i) Company is unable to pay its debts as they become due, or (ii) Company is subject to a pending proceeding as a debtor under the United States Bankruptcy Code, or (iii) Company is determined to be insolvent by any federal and/or state regulatory agency
.
|
(b)
|
At all times during the continuance of this Trust, as provided in Section 1(d) hereof, the principal and income of the Trust shall be subject to claims of general creditors of Company under federal and state law as set forth below.
|
(1)
|
The Board of Directors and the Chief Executive Officer (or, if there is no Chief Executive Officer, the highest ranking officer of the Company) shall have the duty to inform Trustee in writing of Company's Insolvency. If a person claiming to be a creditor of Company alleges in writing to Trustee that Company has become Insolvent, the Trustee shall request the Company to provide a certificate concerning the Company’s Insolvency from one of the parties identified in this subsection (b)(1), and pending receipt of such certificate, the Trustee shall discontinue payment of benefits to Plan participants or their beneficiaries.
|
(2)
|
Unless Trustee has actual knowledge of Company's Insolvency, or has received notice from Company or a person claiming to be a creditor alleging that Company is Insolvent, Trustee shall have no duty to inquire whether Company is Insolvent. Trustee may in all events rely on a certificate concerning the Company’s solvency provided by one of the parties identified in subsection (b)(1) above.
|
(3)
|
If at any time Trustee has received a certificate stating that that Company is Insolvent, Trustee shall discontinue payments to Plan participants or their beneficiaries and shall hold the assets of the Trust for the benefit of Company's general creditors. Nothing in this Trust Agreement shall in any way diminish any rights of Plan participants or their beneficiaries to pursue their rights as general creditors of Company with respect to benefits due under the Plan or otherwise.
|
(4)
|
Trustee shall resume the payment of benefits to Plan participants or their beneficiaries in accordance with Section 2 of this Trust Agreement only after Trustee has received a certificate from one of the parties identified in subsection (b)(1) that Company is not Insolvent (or is no longer Insolvent).
|
(c)
|
Provided that there are sufficient assets, if Trustee discontinues the payment of benefits from the Trust pursuant to Section 3(b) hereof and subsequently resumes such payments, the first payment following such discontinuance shall include the aggregate amount of all payments due to Plan participants or their beneficiaries under the terms of the Plan for the period of such discontinuance, less the aggregate amount of any payments made to Plan participants
|
(a)
|
The Trust may hold assets of any kind, including shares of any registered investment company, whether or not the Trustee or any of its affiliates is an advisor to, or other service provider to, such investment company and receives compensation from such investment company for the services provided (which compensation shall be in addition to the compensation of the Trustee under this Trust.) The Company acknowledges that shares in any such investment company are not obligations of the Trustee or any other bank, are not deposits and are not insured by the Federal Deposit Insurance Corporation (the “
FDIC
”), the Federal Reserve or any other governmental agency. Notwithstanding the foregoing, in no event may Trustee invest in securities (including stock or rights to acquire stock) or obligations issued by Company, other than a de minimis amount held in common investment vehicles in which Trustee invests. All rights associated with assets of the Trust shall be exercised by Trustee or the person designated by Trustee, and shall in no event be exercisable by or rest with Plan participants
,
except that voting and dividend rights with respect to Trust assets will be exercised by Company.
|
(b)
|
Company shall have the right, at any time and from time to time, in its sole discretion, to direct Trustee as to the investment and reinvestment of all or specified portions of Trust assets and the income therefrom and to appoint an investment manager or investment managers to direct Trustee as to the investment and reinvestment of all or specified portions thereof. As of the execution of this Trust Agreement, and until Trustee is notified otherwise in writing, Company shall be solely responsible for directing the investment and reinvestment of all Trust assets.
|
(c)
|
Trustee shall have no responsibility for the selection of investment options, if applicable, under the Trust and shall not render investment advice to any person in connection with the selection of such options. Company shall direct Trustee as to the investment options in which the Trust shall be invested during the term of the Trust.
|
(d)
|
Trustee may hold that portion of the Trust Fund as is appropriate, for the ordinary administration and for the disbursement of funds in cash, without liability for interest notwithstanding Trustee's receipt of "float" from such uninvested cash, by depositing the same in any bank (including deposits which bear a reasonable rate of interest in a bank or similar financial institution supervised by the United States or a State, even where a bank or financial institution is the Trustee, or is otherwise a fiduciary of the Plan) subject to the rules and regulations governing such deposits, and without regard to the amount of such deposit.
|
(e)
|
The parties hereto acknowledge that the Trust fund may be invested in, among other securities, shares of
|
(a)
|
Trustee shall act with care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in like capacity and familiar with such matters would use in the conduct of any enterprise of a like character and with like aims, provided, however, that Trustee shall incur no liability to any person for any action
|
(b)
|
If Trustee undertakes or defends any litigation arising in connection with this Trust on behalf of the Trust, Company agrees to indemnify Trustee against Trustee's costs, expenses and liabilities (including, without limitation, attorneys' fees and expenses) relating thereto and to be primarily liable for such payments. If Company does not pay such costs, expenses and liabilities in a reasonably timely manner, Trustee may obtain payment from the Trust. Notwithstanding the foregoing, the Company’s obligation to provide indemnification under this subsection (b) shall be contingent upon the party seeking indemnification (i) providing the Company with prompt written notice of any claim for which indemnification is sought (provided that the failure to provide prompt notice shall not relieve the Company’s obligation to provide indemnification to the extent that the failure does not prejudice the Company), (ii) allowing the Company to control the defense or settlement of such claim, provided that the Trustee may (but is not required to) participate in the assertion or defense of any action or claim which may be asserted against or on behalf of the Trust and for which it seeks indemnity pursuant to the provisions of this Section, or it may (but is not required to) assume the assertion or defense of such claim or action, including the right to settle or compromise any claim without the consent of the Company, provided that in assuming the assertion or defense it shall be deemed to have waived its right to indemnification except in cases where Company has declined to assert or defend the claim or in cases where a potential conflict of interest exists with respect to Company’s and/or Company’s appointed counsel asserting or defending the claim on behalf of Trust, and (iii) reasonably cooperating with the Company, at the Company’s expense, in connection with such defense or settlement. The Company shall not have the right, without the Trustee’s written consent, to settle any claim if such settlement (i) contains a stipulation to or admission or acknowledgement of, any liability or wrongdoing (whether in contract, tort or otherwise) or the incurrence of any costs or expenses, on the part of the Trustee, or (ii) imposes any obligation upon the Trustee. In no event shall Trustee have any liability or responsibility to undertake, defend or continue any litigation unless payment of related fees and expenses is ensured to the reasonable satisfaction of Trustee.
|
(c)
|
Trustee, at the expense of the Trust or the Company, may consult with legal counsel (who may also be counsel for Company generally) with respect to any of its duties or obligations hereunder.
|
(d)
|
Trustee, at the expense of the Trust or the Company, may hire agents, accountants, actuaries, investment advisors, financial consultants or other professionals to assist it in performing any of its duties or obligations hereunder.
|
(e)
|
Trustee shall have, without exclusion, all powers conferred on trustees by applicable law, unless expressly provided otherwise herein, provided, however, that if an insurance policy is held as an asset of the Trust, Trustee shall have no power to name a beneficiary of the policy other than the Trust, to assign the policy (as distinct from conversion of the policy to a different form) other than to a successor Trustee, or to loan to any person the proceeds of any borrowing against such policy.
|
(f)
|
However, notwithstanding the provisions of Section 8(e) above, Trustee may loan to Company the proceeds of any borrowing against an insurance policy held as an asset of the Trust.
|
(g)
|
Notwithstanding any powers granted to Trustee pursuant to this Trust Agreement or to applicable law, Trustee shall not have any power that could give this Trust the objective of carrying on a business and dividing the gains therefrom, within the meaning of section 301.7701-2 of the Procedure and Administrative Regulations promulgated pursuant to the Internal Revenue Code.
|
(h)
|
Trustee shall have no responsibility or liability with respect to: (i) the truth or accuracy of any representation or warranty made in any application or related document provided to the insurer in connection with the issuance or renewal of any insurance policies or insurance contracts, including any representation that the person on whose life an application is being made is eligible to have a contract issued on his or her life; (ii) the selection or monitoring (ongoing or periodic) of any insurance policies or insurance contracts held in the Trust or the insurers issuing such policies or contracts; (iii) the payment of premiums with respect to such policies or contracts; or (iv) the exercise of any rights relating to any such policies or contracts except as directed in writing by Company.
|
(i)
|
Upon the expiration of ninety (90) days from the date of Trustee’s annual, quarterly or any other account, the Trustee shall be forever released and discharged from all liability and further accountability to Company or any other
|
(j)
|
Trustee shall have no duty or responsibility not expressly set forth in this Trust Agreement. By way of example, but without limiting the matters subject to the foregoing sentence, Trustee shall have no responsibility with respect to the administration or interpretation of the Plan, payment of Plan benefits other than from the assets of the Trust, the calculation of tax to be withheld, reported and/or paid to taxing authorities and (if applicable pursuant to the fee schedule) withholding, remitting, or reporting to taxing authorities of taxes other than from payments made with Trust assets to Plan participants and other than as directed by Company, or maintaining participant records with respect to the Plan.
|
(a)
|
Company shall pay all administrative and Trustee's fees and expenses on a monthly basis. If not so paid, the Trustee shall be entitled to deduct such fees and expenses from the Trust.
|
(b)
|
Company shall indemnify and hold Trustee harmless from and against any and all losses, costs, damages and expenses (including attorney’s fees and disbursements) of any kind or nature (collectively, “
Losses
”) imposed on or incurred by Trustee by reason of its service pursuant to this Trust Agreement, including any Losses arising out of any threatened, pending or completed claim, action, suit or proceeding, except to the extent such Losses are caused by the gross negligence, willful misconduct or bad faith of Trustee. To the extent not paid by Company, Trustee shall be entitled to deduct such amounts from the Trust. Notwithstanding the foregoing, the Company’s obligation to provide indemnification under this subsection (b) shall be contingent upon the party seeking indemnification
|
(c)
|
The provisions of this Section 9 shall survive termination of this Trust Agreement.
|
(a)
|
Trustee may resign at any time by written notice to Company, which shall be effective sixty (60) days after receipt of such notice unless Company and Trustee agree otherwise.
|
(b)
|
Trustee may be removed by Company on sixty (60) days’ notice or upon shorter notice accepted by Trustee.
|
(c)
|
Upon a Change in Control, as defined herein, Trustee may not be removed, and a successor Trustee may not be appointed by Company without the written consent of at least 75% of the participants as of the date of removal or appointment, as applicable, who were participants as of the day preceding the Change in Control.
|
(d)
|
Upon resignation or removal of Trustee and appointment of a successor Trustee, all assets shall subsequently be transferred to the successor Trustee. To the extent possible, the transfer shall be completed within 60 days after receipt of notice of resignation, removal or transfer, unless Company extends the time limit.
|
(e)
|
If Trustee resigns or is removed, a successor shall be appointed, in accordance with Section 11 hereof, by the effective date of resignation or removal under paragraph(s) (a) or (b) of this section. If no such appointment has been made, Trustee may apply to a court of competent jurisdiction for appointment of a successor or for instructions. All expenses of Trustee in connection with the proceeding shall be allowed as administrative expenses of the Trust.
|
(a)
|
If Trustee resigns or is removed in accordance with Section 10(a) or (b) hereof, Company may appoint any third party, such as a bank trust department or other party that may be granted corporate trustee powers under state law, as a successor to replace Trustee upon resignation or removal. The appointment shall be effective when accepted in writing by the new Trustee, who shall have all of the rights and powers of the former Trustee, including ownership rights in the Trust assets. The former Trustee shall execute any instrument necessary or reasonably requested by Company or the successor Trustee to evidence the transfer.
|
(b)
|
The successor Trustee need not examine the records and acts of any prior Trustee and may retain or dispose of existing Trust assets, subject to Sections 7 and 8 hereof. The successor Trustee shall not be responsible for and Company shall indemnify and defend the successor Trustee from any claim or liability resulting from any action or inaction of any prior Trustee or from any other past event, or any condition existing at the time it becomes successor Trustee.
|
(a)
|
This Trust Agreement may be amended by a written instrument executed by Trustee and Company. Notwithstanding the foregoing, no such amendment shall conflict with the terms of the Plan or shall make the Trust revocable after it has become irrevocable in accordance with Section 1(b) hereof.
|
(b)
|
The Trust shall not terminate until the date on which Plan participants and their beneficiaries are no longer entitled to benefits pursuant to the terms of the Plan, unless sooner revoked in accordance with Section 1(b) hereof. Upon termination of the Trust any assets remaining in the Trust shall be returned to Company.
|
(c)
|
Notwithstanding the provisions of subsection (b) above, upon written approval of participants or beneficiaries entitled to payment of benefits pursuant to the terms of the Plan, Company may terminate this Trust prior to the time all benefit payments under the Plan have been made. All assets in the Trust at termination shall be returned to Company.
|
(a)
|
The Trustee shall not be responsible for any lost profits or any special, indirect or consequential damages in respect of any breach or wrongful conduct in any way related to this Agreement. The Trustee shall have no liability for any matters beyond its control such as market loss or diminution, impact of government regulations,
|
(b)
|
Any provision of this Trust Agreement prohibited by law shall be ineffective to the extent of any such prohibition, without invalidating the remaining provisions hereof.
|
(c)
|
Benefits payable to Plan participants and their beneficiaries under this Trust Agreement may not be anticipated, assigned (either at law or in equity), alienated, pledged, encumbered or subjected to attachment, garnishment, levy, execution or other legal or equitable process.
|
(d)
|
This Trust Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. The parties hereto irrevocably consent to the exclusive jurisdiction and venue in the applicable federal and/or New York State courts located in the Borough of Manhattan, New York County, State of New York.
|
(e)
|
Trustee represents that it qualifies for FDIC prorata worth pass-through insurance coverage in accordance with the standards set forth in applicable federal law and FDIC insurance regulations. If Trustee fails at any time in the future to so qualify for prorata worth pass-through insurance coverage, it will promptly notify Company.
|
(f)
|
In no event will Trustee have any obligation to provide, and in no event will Trustee provide, any legal, tax, accounting, audit or other advice to Company with respect to the Plan or this Trust. Company acknowledges that it will rely exclusively on the advice of its accountants and/or attorneys with respect to all legal, tax, accounting, audit and other advice required or desired by Company with respect to the Plan or this Trust. Company acknowledges that Trustee has not made any representations of any kind, and will not make any representations of any kind, concerning the legal, tax, accounting, audit or other treatment of the Plan or this Trust.
|
(g)
|
Company acknowledges that Trustee is not an advisor concerning or a promoter with respect to the Plan or the Trust, but merely is a service provider offering the Trust services expressly set forth in this Agreement. In particular, Company acknowledges that Trustee is not a joint venture or partner with Company’s accountants, auditors, consultants or with any other party, with respect to the Plan or this Trust, and that Trustee and Company’s accountants, auditors and consultants at all times remain independent parties dealing at arm’s length, and independently, with each other and with Company.
|
(h)
|
Company represents and warrants that the Plan and the administration thereof and the establishment of this Trust comply with applicable law and shall continue to be in compliance therewith.
|
(i)
|
Trustee shall have no liability for any losses arising out of delays in performing the services which it renders under this Trust Agreement which result from events beyond its control, including without limitation, interruption of the business of Trustee due to acts of God, acts of governmental authority, acts of war, riots, civil commotions, insurrections, labor difficulties (including, but not limited to, strikes and other work slippages due to slow-downs), or any action of any courier or utility, mechanical or other malfunction, or electronic interruption.
|
(j)
|
Any notice, demand, consent, election, offer, approval, request or other communication (collectively, a “
Notice
”) required or permitted under this Agreement must be in writing and either delivered personally, by a nationally recognized overnight courier, or sent by certified or registered mail, postage prepaid, return receipt requested. A Notice must be addressed to a Party as follows:
|
(k)
|
For purposes of this Trust, Change in Control shall mean:
|
(1)
|
Any Person becomes the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934) of 20% or more of either (x) the then-outstanding shares of common stock (the “
Outstanding PNC Common Stock
”) or (y) the combined voting power of the then- outstanding voting securities of PNC entitled to vote generally in the election of directors (the “
Outstanding PNC Voting Securities
”). The following acquisitions will not constitute a Change in Control for purposes of this definition: (1) any acquisition directly from PNC, (2) any acquisition by PNC, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by PNC or any company controlled by, controlling or under common control with PNC (an “
Affiliated Company
”), (4) any acquisition pursuant to an Excluded Combination (as defined below) or (5) an acquisition of beneficial ownership representing between 20% and 40%, inclusive, of the Outstanding PNC Voting Securities or Outstanding PNC Common Stock if the Incumbent Board (as defined below) as of immediately prior to any such acquisition approves such acquisition either prior to or immediately after its occurrence;
|
(2)
|
Individuals who, as of the date hereof, constitute the Board (the “
Incumbent Board
”) cease for any reason to constitute at least a majority of the Board (excluding any Board seat that is vacant or otherwise unoccupied). For purposes of this definition, any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the shareholders of PNC, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board will be considered as though such individual was a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;
|
(3)
|
Consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving PNC or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of PNC, or the acquisition of assets or stock of another entity by PNC or any of its subsidiaries (each, a “
Business Combination
”). A transaction otherwise meeting the definition of Business Combination will not be treated as a Change in Control if following completion of the transaction all or substantially all of the beneficial owners of the Outstanding PNC Common Stock and the Outstanding PNC Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 60% of the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body), as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns PNC or all or substantially all of PNC’s assets either directly or through one or more subsidiaries) in substantially the
|
(4)
|
Approval by the shareholders of PNC of a complete liquidation or dissolution of PNC.
|
(5)
|
For purposes of this subsection (k), the following definitions shall apply:
|
i.
|
“
Person
” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934.
|
ii.
|
“
PNC
” means The PNC Financial Services Group, Inc. and its Subsidiaries.
|
iii.
|
“
Subsidiary
” means an entity which is a member of a “controlled group” or under “common control” with PNC as determined under Section 414(b) or (c) of the Internal Revenue Code except that an entity shall be deemed to be in a controlled group or under common control with PNC for this purpose if PNC either directly or indirectly owns at least 50% (or 20% with legitimate business criteria) of the total combined voting power of all classes of stock (or similar interests) of such entity or would otherwise satisfy the definition of service recipient under Section 409A of the Internal Revenue Code.
|
(l)
|
The Board of Directors of Company as constituted immediately prior to the consummation of a Change in Control and the Chief Executive Officer of Company shall have the duty to inform Trustee in writing of the occurrence of a Change in Control. Trustee may rely exclusively on this writing and shall have no duty to inquire whether a Change in Control has taken place or to make any determination as to whether a Change in Control has occurred.
|
(a)
|
Definitions.
In connection with this Agreement, including without limitation the evaluation of new services contemplated by the parties to be provided by Trustee under this Agreement, information will be exchanged between Trustee and Plan. Trustee shall provide information that may include, without limitation, confidential information relating to the Trustee’s products, trade secrets, strategic information, information about systems and procedures, confidential reports, Plan information, vendor and other third party information, financial information including cost and pricing, sales strategies, computer software and tapes, programs, source and object codes, and other information that is provided under circumstances reasonably indicating it is confidential (collectively, the “
Trustee Information
”), and Plan shall provide information required for Plan to use the services received or to be received, including Plan information, which may include Personal Information (defined below), to be processed by the services, and other information that is provided under circumstances reasonably indicating it is confidential (“
Plan Information
”) (the Trustee Information and the Plan Information collectively referred to herein as the “
Information
”). Personal Information that is exchanged shall also be deemed Information hereunder. “
Personal Information
” means personal information about an identifiable individual including, without limitation, name, address, contact information, age, gender, income, marital status, finances, health, employment, social security number and trading activity or history. Personal Information shall not include the name, title or business address or business telephone number of an employee of an organization in relation to such individual’s capacity as an employee of an organization. The Information of each party shall remain the exclusive property of such party.
|
(b)
|
Obligations
. The receiver of Information (the “
Receiver
”) shall keep any Information provided by the other party (the “
Provider
”) strictly confidential and shall not, without the Provider’s prior written consent, disclose such Information in any manner whatsoever, in whole or in part, and shall not duplicate, copy or reproduce such Information, including, without limitation, by means of photocopying or transcribing of voice recording, except in accordance with the terms of this Agreement. The Receiver shall only use the Information as reasonably required to carry out the purposes of this Agreement.
|
(c)
|
Disclosure Generally
. Trustee and Plan agree that the Information shall be disclosed by the Receiver only to:
|
(i)
|
the employees, agents and consultants of the Plan and the Designated Representative in connection with
|
(d)
|
Compelled Disclosure
. If the Receiver or anyone to whom the Receiver transmits the Information pursuant to this Agreement becomes legally compelled to disclose any of the Information, then the Receiver will provide the Provider with prompt notice before such Information is disclosed (or, in the case of a disclosure by someone to whom the Receiver transmitted the Information, as soon as the Receiver becomes aware of the compelled disclosure), if not legally prohibited from doing so, so that the Provider may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Agreement. If such protective order or other remedy is not obtained, then the Receiver will furnish only that portion of the Information which the Receiver is advised by reasonable written opinion of counsel is legally required and will exercise its reasonable efforts to assist the Provider in obtaining a protective order or other reliable assurance that confidential treatment will be accorded to the Information that is disclosed.
|
(e)
|
Exceptions
. Except with respect to Personal Information, nothing contained herein shall in any way restrict or impair either party’s right to use, disclose or otherwise deal with:
|
(1)
|
Information which at the time of its disclosure is publicly available, by publication or otherwise, or which the Provider publicly discloses either prior to or subsequent to its disclosure to the Receiver;
|
(2)
|
Information which the Receiver can show was in the possession of the Receiver, or its parent, subsidiary or affiliated company, at the time of disclosure and which was not acquired, directly or indirectly, under any obligation of confidentiality to the Provider; or
|
(3)
|
Information which is independently acquired or developed by the Receiver without violation of its obligations hereunder.
|
(f)
|
Return or Destroy.
Upon the termination of this Agreement for any reason, the parties shall return to each other, or destroy, any and all copies of Information of the other that are in their possession relating to the terminated Agreement, except for any copies reasonably required to maintain such party’s customary archives or computer back-up procedures, and as otherwise required by applicable law, rule or regulation. Notwithstanding the foregoing, Trustee shall have the right to keep one copy of such Information as may be reasonably required to evidence the fact that it has provided the services to Plan. In the event that Plan requires Trustee to return any Plan Information, Plan shall pay Trustee (at the rates set forth in the applicable Schedule, or, if no such rates are set forth, at Trustee’s then current charges) for Trustee’s actual time spent and incidental expenses actually incurred in connection with such return.
|
IN WITNESS WHEREOF, the Company and Trustee have executed this Agreement, as of the date first written above.
Agreed To By:
|
TRUSTEE:
MATRIX TRUST COMPANY
BY:
/s/ Stefanie Armijo
_
NAME:
Stefanie Armijo
_
TITLE:
Vice President
_
|
COMPANY:
The PNC Financial Services Group, Inc.
BY:
/s/ Peggy Chevako
NAME: Peggy Chevako
TITLE: Senior Vice President, Director of Benefits Planning and Administration
|
(1)
|
Cash.
|
(2)
|
Publicly traded stock listed on a U.S. stock exchange or regularly quoted over-the-counter.
|
(3)
|
Publicly traded bonds listed on a U.S. bond exchange or regularly quoted over-the-counter.
|
(4)
|
Mutual funds that are NSCC and DCC&S eligible.
|
(5)
|
Registered limited partnership interests, REITs and similar investments listed on a U.S. stock exchange or regularly quoted over-the-counter.
|
(6)
|
Commercial paper, bankers’ acceptances eligible for rediscounting at the Federal Reserve, repurchase and reverse repurchase agreements and other “money market” instruments for which trading and custodial facilities are readily available.
|
(7)
|
U.S. Government and U.S. Government Agency issues.
|
(8)
|
Municipal securities whose bid and ask values are readily available.
|
(9)
|
Federally insured savings accounts, certificates of deposit and bank investment contracts. The Instructing Party is responsible for determining federal insurance coverage and limits and for diversifying account assets in accordance with those limits.
|
(10)
|
American Depository Receipts, Eurobonds, and similar instruments listed on a U.S. exchange or regularly quoted domestically over-the-counter for which trading and custodial facilities are readily available.
|
(11)
|
Life insurance, annuities, and guaranteed investment contracts issued by insurance companies licensed to do business in one or more states in the U.S. The Instructing Party is responsible for determining the safety of such investments and the economic viability of the underwriter and for diversifying account assets accordingly.
|
(1)
|
Tangible personal property (e.g., precious metals, gems, works of art, coins, furniture and other household items, motor vehicles, etc.).
|
(2)
|
Foreign currency and bank accounts.
|
(3)
|
Short sales.
|
(4)
|
Commodity futures and forward contracts.
|
(5)
|
Oil, gas and mineral interests.
|
(6)
|
Intangible personal property (e.g., patents and rights).
|
(7)
|
Unsecured loans.
|
(8)
|
Interests in real property.
|
(9)
|
Loans secured by first deeds of trust.
|
(10)
|
Other secured loans.
|
(1)
|
General partnerships.
|
(2)
|
Unregistered limited partnerships.
|
(3)
|
Other unregistered securities, closely held stock and other securities for which there is no readily available market, except for qualifying Company securities.
|
(4)
|
The securities of the broker/dealer’s corporate entity or its affiliates and subsidiaries. These securities may be subject to legal and regulatory prohibitions or restrictions. In any event, no Trust may acquire and hold securities of the broker/dealer’s corporate entity unless specifically authorized by the underlying Trust agreement.
|
(5)
|
Foreign securities for which trading and custodial facilities are readily available.
|
(6)
|
Options.
|
(7)
|
Securities of the Company.
|
(8)
|
Any other asset not listed under “Acceptable Assets” or “Unacceptable Assets” above.
|
|
|
|
|
|
|
|
EXHIBIT 12.1
|
|
|||||||||||
The PNC Financial Services Group, Inc. and Subsidiaries
Computation of Ratio of Earnings to Fixed Charges (1)
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
|
Year Ended December 31
|
||||||||||||||||||
Dollars in millions
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Earnings
|
|
|
|
|
|
|
|
|
|
||||||||||
Pretax income from continuing operations before adjustment for noncontrolling interests in
consolidated subsidiaries or income or loss from equity investees
|
$
|
4,510
|
|
|
$
|
4,642
|
|
|
$
|
4,860
|
|
|
$
|
4,993
|
|
|
$
|
5,148
|
|
Add:
|
|
|
|
|
|
|
|
|
|
||||||||||
Distributed income of equity investees
|
352
|
|
|
324
|
|
|
310
|
|
|
275
|
|
|
242
|
|
|||||
Fixed charges excluding interest on deposits
|
1,227
|
|
|
978
|
|
|
796
|
|
|
734
|
|
|
664
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Noncontrolling interests in pretax income of subsidiaries that have not incurred fixed charges
|
57
|
|
|
84
|
|
|
93
|
|
|
96
|
|
|
112
|
|
|||||
Interest capitalized
|
|
|
|
|
1
|
|
|
1
|
|
|
|
||||||||
Earnings excluding interest on deposits
|
6,032
|
|
|
5,860
|
|
|
5,872
|
|
|
5,905
|
|
|
5,942
|
|
|||||
Interest on deposits
|
623
|
|
|
430
|
|
|
403
|
|
|
325
|
|
|
344
|
|
|||||
Total earnings
|
$
|
6,655
|
|
|
$
|
6,290
|
|
|
$
|
6,275
|
|
|
$
|
6,230
|
|
|
$
|
6,286
|
|
Fixed charges
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest on borrowed funds
|
$
|
1,082
|
|
|
$
|
830
|
|
|
$
|
640
|
|
|
$
|
581
|
|
|
$
|
516
|
|
Interest component of rentals
|
144
|
|
|
147
|
|
|
153
|
|
|
152
|
|
|
148
|
|
|||||
Amortization of notes and debentures
|
1
|
|
|
1
|
|
|
2
|
|
|
|
|
|
|||||||
Interest capitalized
|
|
|
|
|
1
|
|
|
1
|
|
|
|
||||||||
Fixed charges excluding interest on deposits
|
1,227
|
|
|
978
|
|
|
796
|
|
|
734
|
|
|
664
|
|
|||||
Interest on deposits
|
623
|
|
|
430
|
|
|
403
|
|
|
325
|
|
|
344
|
|
|||||
Total fixed charges
|
$
|
1,850
|
|
|
$
|
1,408
|
|
|
$
|
1,199
|
|
|
$
|
1,059
|
|
|
$
|
1,008
|
|
Ratio of earnings to fixed charges
|
|
|
|
|
|
|
|
|
|
||||||||||
Excluding interest on deposits
|
4.92
|
x
|
|
5.99
|
x
|
|
7.38
|
x
|
|
8.04
|
x
|
|
8.95
|
x
|
|||||
Including interest on deposits
|
3.60
|
|
|
4.47
|
|
|
5.23
|
|
|
5.88
|
|
|
6.24
|
|
(1)
|
As defined in Item 503(d) of Regulation S-K
|
|
|
|
|
|
|
|
EXHIBIT 12.2
|
|
|||||||||||
The PNC Financial Services Group, Inc. and Subsidiaries
Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividends (1)
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
||||||||||||
|
Year Ended December 31
|
||||||||||||||||||
Dollars in millions
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Earnings
|
|
|
|
|
|
|
|
|
|
||||||||||
Pretax income from continuing operations before adjustment for noncontrolling interests in
consolidated subsidiaries or income or loss from equity investees
|
$
|
4,510
|
|
|
$
|
4,642
|
|
|
$
|
4,860
|
|
|
$
|
4,993
|
|
|
$
|
5,148
|
|
Add:
|
|
|
|
|
|
|
|
|
|
||||||||||
Distributed income of equity investees
|
352
|
|
|
324
|
|
|
310
|
|
|
275
|
|
|
242
|
|
|||||
Fixed charges and preferred stock dividends excluding interest on deposits
|
1,590
|
|
|
1,300
|
|
|
1,134
|
|
|
1,091
|
|
|
1,028
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Noncontrolling interests in pretax income of subsidiaries that have not incurred fixed charges
|
57
|
|
|
84
|
|
|
93
|
|
|
96
|
|
|
112
|
|
|||||
Interest capitalized
|
|
|
|
|
1
|
|
|
1
|
|
|
|
||||||||
Preferred stock dividend requirements
|
363
|
|
|
322
|
|
|
338
|
|
|
357
|
|
|
364
|
|
|||||
Earnings excluding interest on deposits
|
6,032
|
|
|
5,860
|
|
|
5,872
|
|
|
5,905
|
|
|
5,942
|
|
|||||
Interest on deposits
|
623
|
|
|
430
|
|
|
403
|
|
|
325
|
|
|
344
|
|
|||||
Total earnings
|
$
|
6,655
|
|
|
$
|
6,290
|
|
|
$
|
6,275
|
|
|
$
|
6,230
|
|
|
$
|
6,286
|
|
Fixed charges and preferred stock dividends
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest on borrowed funds
|
$
|
1,082
|
|
|
$
|
830
|
|
|
$
|
640
|
|
|
$
|
581
|
|
|
$
|
516
|
|
Interest component of rentals
|
144
|
|
|
147
|
|
|
153
|
|
|
152
|
|
|
148
|
|
|||||
Amortization of notes and debentures
|
1
|
|
|
1
|
|
|
2
|
|
|
|
|
|
|||||||
Interest capitalized
|
|
|
|
|
1
|
|
|
1
|
|
|
|
||||||||
Preferred stock dividend requirements
|
363
|
|
|
322
|
|
|
338
|
|
|
357
|
|
|
364
|
|
|||||
Fixed charges and preferred stock dividends excluding interest on deposits
|
1,590
|
|
|
1,300
|
|
|
1,134
|
|
|
1,091
|
|
|
1,028
|
|
|||||
Interest on deposits
|
623
|
|
|
430
|
|
|
403
|
|
|
325
|
|
|
344
|
|
|||||
Total fixed charges and preferred stock dividends
|
$
|
2,213
|
|
|
$
|
1,730
|
|
|
$
|
1,537
|
|
|
$
|
1,416
|
|
|
$
|
1,372
|
|
Ratio of earnings to fixed charges and preferred stock dividends
|
|
|
|
|
|
|
|
|
|
||||||||||
Excluding interest on deposits
|
3.79
|
x
|
|
4.51
|
x
|
|
5.18
|
x
|
|
5.41
|
x
|
|
5.78
|
x
|
|||||
Including interest on deposits
|
3.01
|
|
|
3.64
|
|
|
4.08
|
|
|
4.40
|
|
|
4.58
|
|
(1)
|
As defined in Item 503(d) of Regulation S-K.
|
Name
|
State or Other Jurisdiction of
Incorporation or Organization
|
|
|
PNC Bancorp, Inc.
(1)
|
Delaware
|
PNC Bank, National Association
(1)
|
United States
|
PNC REIT Corp.
|
Delaware
|
PNC Preferred Funding LLC
|
Delaware
|
PNC Equipment Finance, LLC
|
Delaware
|
PNC Merchant Services Company
|
Delaware
|
PNC NCNVINV, Inc.
|
Delaware
|
PNC Holding, LLC
(1)
|
Delaware
|
PNC Investment Company LLC
(1)
|
Delaware
|
PNC Capital Markets, LLC
|
Pennsylvania
|
PNC Capital Finance, LLC
|
Delaware
|
(1)
|
The names of the subsidiaries of the indicated entities are omitted because such subsidiaries, considered in the aggregate as a single subsidiary, would not constitute a significant subsidiary.
|
|
/s/ PricewaterhouseCoopers LLP
|
Pittsburgh, Pennsylvania
|
February 28, 2018
|
•
|
|
Forms S-3 relating to the Corporation’s Dividend Reinvestment and Stock Purchase Plan (No. 333-210994)
|
•
|
|
Forms S-8 relating to the Corporation’s Employee Stock Purchase Plan (No 333-156540)
|
•
|
|
Forms S-8 relating to the Corporation’s Supplemental Incentive Savings Plan and the Corporation and Affiliates’ Deferred Compensation Plan (Nos. 333-18069, 333-65040, 333-136808, and 333-172931)
|
•
|
|
Form S-8 relating to the Corporation’s Supplemental Incentive Savings Plan and the Corporation and Affiliates’ Deferred Compensation Plan (No. 333-156886)
|
•
|
|
Form S-8 relating to the Corporation’s Deferred Compensation and Incentive Plan (Nos. 333-177896 and 333-198461)
|
•
|
|
Forms S-8 relating to the Corporation’s 2006 Incentive Award Plan (Nos. 333-134169, 333-139345, 333-143182 and 333-177898)
|
•
|
|
Form S-4 relating to the Corporation’s acquisition of National City Corporation (No. 333-155248)
|
•
|
|
Form S-8 relating to various National City plans (No. 333-156527)
|
•
|
|
Form S-8 relating to the Corporation’s 2016 Incentive Award Plan (No. 333-210995)
|
•
|
|
Form S-3 relating to the shelf registration statement of debt securities, common stock, preferred stock, purchase contracts, units, warrants and depositary shares to be issued by the Corporation (No. 333-209782)
|
|
/s/ Deloitte and Touche LLP
|
New York, New York
|
February 28, 2018
|
Name/Signature
|
Capacity
|
/s/ William S. Demchak
William S. Demchak |
Chairman, Chief Executive Officer and President (Principal Executive Officer) and Director
|
/s/ Robert Q. Reilly
Robert Q. Reilly |
Executive Vice President and Chief Financial Officer
(Principal Financial Officer) |
/s/ Gregory H. Kozich
Gregory H. Kozich |
Senior Vice President and Controller
(Principal Accounting Officer) |
/s/ Charles E. Bunch
Charles E. Bunch |
Director
|
/s/ Debra A. Cafaro
Debra A. Cafaro |
Director
|
/s/ Marjorie Rodgers Cheshire
Marjorie Rodgers Cheshire |
Director
|
/s/ Andrew T. Feldstein
Andrew T. Feldstein |
Director
|
/s/ Daniel R. Hesse
Daniel R. Hesse |
Director
|
/s/ Richard B. Kelson
Richard B. Kelson |
Director
|
/s/ Linda R. Medler
Linda R. Medler |
Director
|
/s/ Jane G. Pepper
Jane G. Pepper |
Director
|
/s/ Martin Pfinsgraff
Martin Pfinsgraff |
Director
|
/s/ Donald J. Shepard
Donald J. Shepard |
Director
|
/s/ Lorene K. Steffes
Lorene K. Steffes |
Director
|
/s/ Dennis F. Strigl
Dennis F. Strigl |
Director
|
/s/ Michael J. Ward
Michael J. Ward |
Director
|
/s/ Gregory D. Wasson
Gregory D. Wasson |
Director
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2017 of The PNC Financial Services Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ William S. Demchak
|
|
William S. Demchak
|
|
Chairman, President and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2017 of The PNC Financial Services Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
/s/ Robert Q. Reilly
|
|
Robert Q. Reilly
|
|
Executive Vice President and Chief Financial Officer
|
|
|
/s/ William S. Demchak
|
|
William S. Demchak
|
|
Chairman, President and Chief Executive Officer
|
|
|
/s/ Robert Q. Reilly
|
|
Robert Q. Reilly
|
|
Executive Vice President and Chief Financial Officer
|
Report of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated Statements of Financial Condition
|
F-3
|
Consolidated Statements of Income
|
F-4
|
Consolidated Statements of Comprehensive Income
|
F-5
|
Consolidated Statements of Changes in Equity
|
F-6
|
Consolidated Statements of Cash Flows
|
F-8
|
Notes to the Consolidated Financial Statements
|
F-9
|
(in millions, except shares and per share data)
|
|
December 31,
2017
|
|
December 31,
2016
|
||||
Assets
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
6,894
|
|
|
$
|
6,091
|
|
Accounts receivable
|
|
2,699
|
|
|
2,115
|
|
||
Investments
|
|
1,981
|
|
|
1,595
|
|
||
Assets of consolidated variable interest entities:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
144
|
|
|
84
|
|
||
Investments
|
|
1,493
|
|
|
1,008
|
|
||
Other assets
|
|
66
|
|
|
63
|
|
||
Separate account assets
|
|
149,937
|
|
|
149,089
|
|
||
Separate account collateral held under securities lending agreements
|
|
24,190
|
|
|
27,792
|
|
||
Property and equipment (net of accumulated depreciation of $658 and $601 at December 31,
2017 and December 31, 2016, respectively)
|
|
592
|
|
|
559
|
|
||
Intangible assets (net of accumulated amortization of $219 and $832 at December 31, 2017
and December 31, 2016, respectively)
|
|
17,389
|
|
|
17,363
|
|
||
Goodwill
|
|
13,220
|
|
|
13,118
|
|
||
Other assets
|
|
1,612
|
|
|
1,300
|
|
||
Total assets
|
|
$
|
220,217
|
|
|
$
|
220,177
|
|
Liabilities
|
|
|
|
|
|
|
||
Accrued compensation and benefits
|
|
$
|
2,153
|
|
|
$
|
1,880
|
|
Accounts payable and accrued liabilities
|
|
1,161
|
|
|
880
|
|
||
Liabilities of consolidated variable interest entities
|
|
369
|
|
|
216
|
|
||
Borrowings
|
|
5,014
|
|
|
4,915
|
|
||
Separate account liabilities
|
|
149,937
|
|
|
149,089
|
|
||
Separate account collateral liabilities under securities lending agreements
|
|
24,190
|
|
|
27,792
|
|
||
Deferred income tax liabilities
|
|
3,538
|
|
|
4,840
|
|
||
Other liabilities
|
|
1,564
|
|
|
1,221
|
|
||
Total liabilities
|
|
187,926
|
|
|
190,833
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
|
|
|
||
Temporary equity
|
|
|
|
|
|
|
||
Redeemable noncontrolling interests
|
|
416
|
|
|
194
|
|
||
Permanent Equity
|
|
|
|
|
|
|
||
BlackRock, Inc. stockholders’ equity
|
|
|
|
|
|
|
||
Common stock, $ 0.01 par value;
|
|
2
|
|
|
2
|
|
||
Shares authorized: 500,000,000 at December 31, 2017 and December 31, 2016;
Shares issued: 171,252,185 at December 31, 2017 and December 31, 2016;
Shares outstanding: 159,977,115 and 161,534,443 at December 31, 2017 and
December 31, 2016, respectively
|
|
|
|
|
|
|
||
Series B nonvoting participating preferred stock, $0.01 par value;
|
|
—
|
|
|
—
|
|
||
Shares authorized: 150,000,000 at December 31, 2017 and 2016; Shares issued and outstanding:
823,188 at December 31, 2017 and 2016;
|
|
|
|
|
|
|
||
Series C nonvoting participating preferred stock, $0.01 par value;
|
|
—
|
|
|
—
|
|
||
Shares authorized: 6,000,000 at December 31, 2017 and 2016; Shares issued and outstanding:
246,522 at December 31, 2017 and 763,660 at December 31, 2016
|
|
|
|
|
|
|
||
Additional paid-in capital
|
|
19,256
|
|
|
19,337
|
|
||
Retained earnings
|
|
16,966
|
|
|
13,660
|
|
||
Accumulated other comprehensive loss
|
|
(432
|
)
|
|
(716
|
)
|
||
Treasury stock, common, at cost (11,275,070 and 9,717,742 shares held at December 31, 2017 and
December 31, 2016, respectively)
|
|
(3,967
|
)
|
|
(3,185
|
)
|
||
Total BlackRock, Inc. stockholders’ equity
|
|
31,825
|
|
|
29,098
|
|
||
Nonredeemable noncontrolling interests
|
|
50
|
|
|
52
|
|
||
Total permanent equity
|
|
31,875
|
|
|
29,150
|
|
||
Total liabilities, temporary equity and permanent equity
|
|
$
|
220,217
|
|
|
$
|
220,177
|
|
(in millions, except shares and per share data)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Revenue
|
|
|
|
|
|
|
|
|
|
|||
Investment advisory, administration fees and securities lending revenue:
|
|
|
|
|
|
|
|
|
|
|||
Related parties
|
|
$
|
7,740
|
|
|
$
|
6,836
|
|
|
$
|
6,875
|
|
Other third parties
|
|
3,153
|
|
|
3,044
|
|
|
2,965
|
|
|||
Total investment advisory, administration fees and securities lending revenue
|
|
10,893
|
|
|
9,880
|
|
|
9,840
|
|
|||
Investment advisory performance fees
|
|
594
|
|
|
295
|
|
|
621
|
|
|||
Technology and risk management revenue
|
|
677
|
|
|
595
|
|
|
528
|
|
|||
Distribution fees
|
|
24
|
|
|
41
|
|
|
55
|
|
|||
Advisory and other revenue
|
|
303
|
|
|
344
|
|
|
357
|
|
|||
Total revenue
|
|
12,491
|
|
|
11,155
|
|
|
11,401
|
|
|||
Expense
|
|
|
|
|
|
|
|
|
|
|||
Employee compensation and benefits
|
|
4,255
|
|
|
3,880
|
|
|
4,005
|
|
|||
Distribution and servicing costs
|
|
492
|
|
|
429
|
|
|
409
|
|
|||
Amortization of deferred sales commissions
|
|
17
|
|
|
34
|
|
|
48
|
|
|||
Direct fund expense
|
|
904
|
|
|
766
|
|
|
767
|
|
|||
General and administration
|
|
1,462
|
|
|
1,301
|
|
|
1,380
|
|
|||
Restructuring charge
|
|
—
|
|
|
76
|
|
|
—
|
|
|||
Amortization of intangible assets
|
|
89
|
|
|
99
|
|
|
128
|
|
|||
Total expense
|
|
7,219
|
|
|
6,585
|
|
|
6,737
|
|
|||
Operating income
|
|
5,272
|
|
|
4,570
|
|
|
4,664
|
|
|||
Nonoperating income (expense)
|
|
|
|
|
|
|
|
|
|
|||
Net gain (loss) on investments
|
|
161
|
|
|
55
|
|
|
116
|
|
|||
Interest and dividend income
|
|
49
|
|
|
40
|
|
|
26
|
|
|||
Interest expense
|
|
(205
|
)
|
|
(205
|
)
|
|
(204
|
)
|
|||
Total nonoperating income (expense)
|
|
5
|
|
|
(110
|
)
|
|
(62
|
)
|
|||
Income before income taxes
|
|
5,277
|
|
|
4,460
|
|
|
4,602
|
|
|||
Income tax expense
|
|
270
|
|
|
1,290
|
|
|
1,250
|
|
|||
Net income
|
|
5,007
|
|
|
3,170
|
|
|
3,352
|
|
|||
Less:
|
|
|
|
|
|
|
|
|
|
|||
Net income (loss) attributable to noncontrolling interests
|
|
37
|
|
|
(2
|
)
|
|
7
|
|
|||
Net income attributable to BlackRock, Inc.
|
|
$
|
4,970
|
|
|
$
|
3,172
|
|
|
$
|
3,345
|
|
Earnings per share attributable to BlackRock, Inc. common stockholders:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
$
|
30.65
|
|
|
$
|
19.29
|
|
|
$
|
20.10
|
|
Diluted
|
|
$
|
30.23
|
|
|
$
|
19.04
|
|
|
$
|
19.79
|
|
Cash dividends declared and paid per share
|
|
$
|
10.00
|
|
|
$
|
9.16
|
|
|
$
|
8.72
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
162,160,601
|
|
|
164,425,858
|
|
|
166,390,009
|
|
|||
Diluted
|
|
164,415,035
|
|
|
166,579,752
|
|
|
169,038,571
|
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Net income
|
|
$
|
5,007
|
|
|
$
|
3,170
|
|
|
$
|
3,352
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|||
Foreign currency translation adjustments
(1)
|
|
285
|
|
|
(269
|
)
|
|
(173
|
)
|
|||
Other
|
|
(1
|
)
|
|
1
|
|
|
(2
|
)
|
|||
Other comprehensive income (loss)
|
|
284
|
|
|
(268
|
)
|
|
(175
|
)
|
|||
Comprehensive income
|
|
5,291
|
|
|
2,902
|
|
|
3,177
|
|
|||
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
|
37
|
|
|
(2
|
)
|
|
7
|
|
|||
Comprehensive income attributable to BlackRock, Inc.
|
|
$
|
5,254
|
|
|
$
|
2,904
|
|
|
$
|
3,170
|
|
(in millions)
|
|
Additional
Paid-in
Capital
(1)
|
|
Retained
Earnings
|
|
Appropriated
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Treasury
Stock
Common
|
|
Total
BlackRock
Stockholders’
Equity
|
|
Nonredeemable
Noncontrolling
Interests
|
|
Total
Permanent
Equity
|
|
Redeemable
Noncontrolling
Interests /
Temporary
Equity
|
||||||||||||||||||
December 31, 2014
|
|
$
|
19,388
|
|
|
$
|
10,164
|
|
|
$
|
(19
|
)
|
|
$
|
(273
|
)
|
|
$
|
(1,894
|
)
|
|
$
|
27,366
|
|
|
$
|
119
|
|
|
$
|
27,485
|
|
|
$
|
35
|
|
Net income
|
|
—
|
|
|
3,345
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,345
|
|
|
6
|
|
|
3,351
|
|
|
1
|
|
|||||||||
Net consolidation (deconsolidation) of VIEs due to adoption
of new accounting pronouncement
|
|
—
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
(8
|
)
|
|
11
|
|
|
194
|
|
|||||||||
Dividends paid
|
|
—
|
|
|
(1,476
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,476
|
)
|
|
—
|
|
|
(1,476
|
)
|
|
—
|
|
|||||||||
Stock-based compensation
|
|
514
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
514
|
|
|
—
|
|
|
514
|
|
|
—
|
|
|||||||||
Issuance of common shares related to employee stock
transactions
|
|
(600
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
736
|
|
|
136
|
|
|
—
|
|
|
136
|
|
|
—
|
|
|||||||||
Employee tax withholdings related to employee stock
transactions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(231
|
)
|
|
(231
|
)
|
|
—
|
|
|
(231
|
)
|
|
—
|
|
|||||||||
Shares repurchased
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,100
|
)
|
|
(1,100
|
)
|
|
—
|
|
|
(1,100
|
)
|
|
—
|
|
|||||||||
Net tax benefit (shortfall) from stock-based compensation
|
|
105
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
105
|
|
|
—
|
|
|
105
|
|
|
—
|
|
|||||||||
Subscriptions (redemptions/distributions)
— noncontrolling interest holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|
(34
|
)
|
|
518
|
|
|||||||||
Net consolidations (deconsolidations) of sponsored
investment funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(6
|
)
|
|
(284
|
)
|
|||||||||
Other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(175
|
)
|
|
—
|
|
|
(175
|
)
|
|
—
|
|
|
(175
|
)
|
|
—
|
|
|||||||||
December 31, 2015
|
|
$
|
19,407
|
|
|
$
|
12,033
|
|
|
$
|
—
|
|
|
$
|
(448
|
)
|
|
$
|
(2,489
|
)
|
|
$
|
28,503
|
|
|
$
|
77
|
|
|
$
|
28,580
|
|
|
$
|
464
|
|
Net income
|
|
—
|
|
|
3,172
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,172
|
|
|
(2
|
)
|
|
3,170
|
|
|
—
|
|
|||||||||
Dividends paid
|
|
—
|
|
|
(1,545
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,545
|
)
|
|
—
|
|
|
(1,545
|
)
|
|
—
|
|
|||||||||
Stock-based compensation
|
|
521
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
521
|
|
|
—
|
|
|
521
|
|
|
—
|
|
|||||||||
PNC preferred stock capital contribution
|
|
172
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
172
|
|
|
—
|
|
|
172
|
|
|
—
|
|
|||||||||
Retirement of preferred stock
|
|
(172
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(172
|
)
|
|
—
|
|
|
(172
|
)
|
|
—
|
|
|||||||||
Issuance of common shares related to employee stock
transactions
|
|
(667
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
703
|
|
|
36
|
|
|
—
|
|
|
36
|
|
|
—
|
|
|||||||||
Employee tax withholdings related to employee stock
transactions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(274
|
)
|
|
(274
|
)
|
|
—
|
|
|
(274
|
)
|
|
—
|
|
|||||||||
Shares repurchased
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,125
|
)
|
|
(1,125
|
)
|
|
—
|
|
|
(1,125
|
)
|
|
—
|
|
|||||||||
Net tax benefit (shortfall) from stock-based compensation
|
|
78
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
78
|
|
|
—
|
|
|
78
|
|
|
—
|
|
|||||||||
Subscriptions (redemptions/distributions)
— noncontrolling interest holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|
(23
|
)
|
|
1,169
|
|
|||||||||
Net consolidations (deconsolidations) of sponsored
investment funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,439
|
)
|
|||||||||
Other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(268
|
)
|
|
—
|
|
|
(268
|
)
|
|
—
|
|
|
(268
|
)
|
|
—
|
|
|||||||||
December 31, 2016
|
|
$
|
19,339
|
|
|
$
|
13,660
|
|
|
$
|
—
|
|
|
$
|
(716
|
)
|
|
$
|
(3,185
|
)
|
|
$
|
29,098
|
|
|
$
|
52
|
|
|
$
|
29,150
|
|
|
$
|
194
|
|
(1)
|
Amounts include $2 million of common stock at December 31, 2016, 2015 and 2014.
|
(in millions)
|
|
Additional
Paid-in
Capital
(1)
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Treasury
Stock
Common
|
|
Total
BlackRock
Stockholders’
Equity
|
|
Nonredeemable
Noncontrolling
Interests
|
|
Total
Permanent
Equity
|
|
Redeemable
Noncontrolling
Interests /
Temporary
Equity
|
||||||||||||||||
December 31, 2016
|
|
$
|
19,339
|
|
|
$
|
13,660
|
|
|
$
|
(716
|
)
|
|
$
|
(3,185
|
)
|
|
$
|
29,098
|
|
|
$
|
52
|
|
|
$
|
29,150
|
|
|
$
|
194
|
|
Net income
|
|
—
|
|
|
4,970
|
|
|
—
|
|
|
—
|
|
|
4,970
|
|
|
2
|
|
|
4,972
|
|
|
35
|
|
||||||||
Dividends paid
|
|
—
|
|
|
(1,662
|
)
|
|
—
|
|
|
—
|
|
|
(1,662
|
)
|
|
—
|
|
|
(1,662
|
)
|
|
—
|
|
||||||||
Stock-based compensation
|
|
542
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
542
|
|
|
—
|
|
|
542
|
|
|
—
|
|
||||||||
PNC preferred stock capital contribution
|
|
193
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
193
|
|
|
—
|
|
|
193
|
|
|
—
|
|
||||||||
Retirement of preferred stock
|
|
(193
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(193
|
)
|
|
—
|
|
|
(193
|
)
|
|
—
|
|
||||||||
Issuance of common shares related to employee stock
transactions
|
|
(626
|
)
|
|
—
|
|
|
—
|
|
|
639
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||||||
Employee tax withholdings related to employee stock
transactions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(321
|
)
|
|
(321
|
)
|
|
—
|
|
|
(321
|
)
|
|
—
|
|
||||||||
Shares repurchased
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,100
|
)
|
|
(1,100
|
)
|
|
—
|
|
|
(1,100
|
)
|
|
—
|
|
||||||||
Subscriptions (redemptions/distributions)
— noncontrolling interest holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
(18
|
)
|
|
482
|
|
||||||||
Net consolidations (deconsolidations) of sponsored
investment funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|
14
|
|
|
(295
|
)
|
||||||||
Other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
284
|
|
|
—
|
|
|
284
|
|
|
—
|
|
|
284
|
|
|
—
|
|
||||||||
Adoption of new accounting pronouncement
|
|
3
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||||
December 31, 2017
|
|
$
|
19,258
|
|
|
$
|
16,966
|
|
|
$
|
(432
|
)
|
|
$
|
(3,967
|
)
|
|
$
|
31,825
|
|
|
$
|
50
|
|
|
$
|
31,875
|
|
|
$
|
416
|
|
(1)
|
Amounts include $2 million of common stock at both December 31, 2017 and 2016.
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
5,007
|
|
|
$
|
3,170
|
|
|
$
|
3,352
|
|
Adjustments to reconcile net income to cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
240
|
|
|
263
|
|
|
295
|
|
|||
Stock-based compensation
|
|
542
|
|
|
521
|
|
|
514
|
|
|||
Deferred income tax expense (benefit)
|
|
(1,221
|
)
|
|
(14
|
)
|
|
(156
|
)
|
|||
Other gains
|
|
—
|
|
|
—
|
|
|
(40
|
)
|
|||
Assets and liabilities of consolidated VIEs:
|
|
|
|
|
|
|
|
|
|
|||
Change in cash and cash equivalents
|
|
(81
|
)
|
|
(119
|
)
|
|
(98
|
)
|
|||
Net (gains) losses within consolidated VIEs
|
|
(118
|
)
|
|
(16
|
)
|
|
(58
|
)
|
|||
Net (purchases) proceeds within consolidated VIEs
|
|
(302
|
)
|
|
(816
|
)
|
|
(227
|
)
|
|||
(Earnings) losses from equity method investees
|
|
(122
|
)
|
|
(113
|
)
|
|
(91
|
)
|
|||
Distributions of earnings from equity method investees
|
|
35
|
|
|
31
|
|
|
41
|
|
|||
Other adjustments
|
|
—
|
|
|
—
|
|
|
14
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
|
(521
|
)
|
|
(65
|
)
|
|
(82
|
)
|
|||
Investments, trading
|
|
(222
|
)
|
|
(449
|
)
|
|
(584
|
)
|
|||
Other assets
|
|
(212
|
)
|
|
(151
|
)
|
|
(195
|
)
|
|||
Accrued compensation and benefits
|
|
276
|
|
|
(86
|
)
|
|
98
|
|
|||
Accounts payable and accrued liabilities
|
|
308
|
|
|
26
|
|
|
(41
|
)
|
|||
Other liabilities
|
|
219
|
|
|
(28
|
)
|
|
262
|
|
|||
Cash flows from operating activities
|
|
3,828
|
|
|
2,154
|
|
|
3,004
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|||
Purchases of investments
|
|
(489
|
)
|
|
(377
|
)
|
|
(330
|
)
|
|||
Proceeds from sales and maturities of investments
|
|
166
|
|
|
378
|
|
|
456
|
|
|||
Distributions of capital from equity method investees
|
|
32
|
|
|
34
|
|
|
66
|
|
|||
Net consolidations (deconsolidations) of sponsored investment funds
|
|
(39
|
)
|
|
(74
|
)
|
|
(163
|
)
|
|||
Acquisitions, net of cash acquired
|
|
(102
|
)
|
|
(30
|
)
|
|
(273
|
)
|
|||
Purchases of property and equipment
|
|
(155
|
)
|
|
(119
|
)
|
|
(221
|
)
|
|||
Cash flows from investing activities
|
|
(587
|
)
|
|
(188
|
)
|
|
(465
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|||
Proceeds from long-term borrowings
|
|
697
|
|
|
—
|
|
|
787
|
|
|||
Repayments of long-term borrowings
|
|
(700
|
)
|
|
—
|
|
|
(750
|
)
|
|||
Cash dividends paid
|
|
(1,662
|
)
|
|
(1,545
|
)
|
|
(1,476
|
)
|
|||
Proceeds from stock options exercised
|
|
—
|
|
|
26
|
|
|
126
|
|
|||
Repurchases of common stock
|
|
(1,421
|
)
|
|
(1,399
|
)
|
|
(1,331
|
)
|
|||
Net (redemptions/distributions paid)/subscriptions received from noncontrolling
interest holders
|
|
464
|
|
|
1,146
|
|
|
484
|
|
|||
Excess tax benefit from stock-based compensation
|
|
—
|
|
|
82
|
|
|
105
|
|
|||
Other financing activities
|
|
(8
|
)
|
|
5
|
|
|
(9
|
)
|
|||
Cash flows from financing activities
|
|
(2,630
|
)
|
|
(1,685
|
)
|
|
(2,064
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
192
|
|
|
(273
|
)
|
|
(115
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
803
|
|
|
8
|
|
|
360
|
|
|||
Cash and cash equivalents, beginning of year
|
|
6,091
|
|
|
6,083
|
|
|
5,723
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
6,894
|
|
|
$
|
6,091
|
|
|
$
|
6,083
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for:
|
|
|
|
|
|
|
|
|
|
|||
Interest
|
|
$
|
205
|
|
|
$
|
198
|
|
|
$
|
194
|
|
Income taxes (net of refunds)
|
|
$
|
1,124
|
|
|
$
|
1,365
|
|
|
$
|
1,276
|
|
Supplemental schedule of noncash investing and financing transactions:
|
|
|
|
|
|
|
|
|
|
|||
Issuance of common stock
|
|
$
|
626
|
|
|
$
|
667
|
|
|
$
|
600
|
|
PNC preferred stock capital contribution
|
|
$
|
193
|
|
|
$
|
172
|
|
|
$
|
—
|
|
Increase (decrease) in noncontrolling interests due to net consolidation (deconsolidation) of
sponsored investment funds
|
|
$
|
(281
|
)
|
|
$
|
(1,439
|
)
|
|
$
|
(104
|
)
|
Increase (decrease) in borrowings due to consolidation/deconsolidation of VIEs
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,389
|
)
|
•
|
Level 1 assets may include listed mutual funds, ETFs, listed equities and certain exchange-traded derivatives.
|
•
|
Level 2 assets may include debt securities, investments in CLOs, short-term floating-rate notes, asset-backed securities, securities held within consolidated hedge funds, restricted public securities valued at a discount, as well
|
•
|
Level 3 assets may include direct private equity investments held within consolidated funds and investments in CLOs.
|
•
|
Level 3 liabilities include contingent liabilities related to acquisitions valued based upon discounted cash flow analyses using unobservable market data.
|
(in millions)
|
|
December 31,
2017
|
|
December 31,
2016
|
||||
Available-for-sale investments
|
|
$
|
103
|
|
|
$
|
80
|
|
Held-to-maturity investments
|
|
102
|
|
|
51
|
|
||
Trading investments:
|
|
|
|
|
|
|
||
Consolidated sponsored investment funds:
|
|
|
|
|
|
|
||
Debt securities
|
|
267
|
|
|
246
|
|
||
Equity securities
|
|
245
|
|
|
219
|
|
||
Other equity and debt securities
|
|
267
|
|
|
101
|
|
||
Deferred compensation plan mutual funds
|
|
56
|
|
|
59
|
|
||
Total trading investments
|
|
835
|
|
|
625
|
|
||
Other investments:
|
|
|
|
|
|
|
||
Equity method investments
(1)
|
|
816
|
|
|
730
|
|
||
Cost method investments
(2)
|
|
93
|
|
|
91
|
|
||
Carried interest
(3)
|
|
32
|
|
|
18
|
|
||
Total other investments
|
|
941
|
|
|
839
|
|
||
Total investments
|
|
$
|
1,981
|
|
|
$
|
1,595
|
|
|
|
Year ended December 31,
|
||||||||||
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Sales proceeds
|
|
$
|
—
|
|
|
$
|
40
|
|
|
$
|
36
|
|
Net realized gain (loss):
|
|
|
|
|
|
|
|
|
|
|||
Gross realized gains
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
3
|
|
Gross realized losses
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Net realized gain (loss)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||||||||
(in millions)
|
|
Cost
|
|
Carrying
Value
|
|
Cost
|
|
Carrying
Value
|
||||||||
Trading investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Deferred compensation plan mutual funds
|
|
$
|
34
|
|
|
$
|
56
|
|
|
$
|
41
|
|
|
$
|
59
|
|
Equity securities/multi-asset mutual funds
|
|
446
|
|
|
493
|
|
|
290
|
|
|
308
|
|
||||
Debt securities/fixed income mutual funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate debt
|
|
152
|
|
|
157
|
|
|
128
|
|
|
128
|
|
||||
Government debt
|
|
72
|
|
|
73
|
|
|
60
|
|
|
60
|
|
||||
Asset/mortgage backed debt
|
|
56
|
|
|
56
|
|
|
70
|
|
|
70
|
|
||||
Total trading investments
|
|
$
|
760
|
|
|
$
|
835
|
|
|
$
|
589
|
|
|
$
|
625
|
|
(in millions)
|
|
December 31,
2017
|
|
December 31,
2016
|
||||
Cash and cash equivalents
|
|
$
|
63
|
|
|
$
|
53
|
|
Investments
|
|
512
|
|
|
465
|
|
||
Other assets
|
|
13
|
|
|
15
|
|
||
Other liabilities
|
|
(37
|
)
|
|
(50
|
)
|
||
Noncontrolling interests
|
|
(91
|
)
|
|
(39
|
)
|
||
BlackRock’s net interests in consolidated VREs
|
|
$
|
460
|
|
|
$
|
444
|
|
(in millions)
|
|
December 31,
2017
|
|
December 31,
2016
|
||||
Assets of consolidated VIEs:
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
144
|
|
|
$
|
84
|
|
Investments:
|
|
|
|
|
|
|
||
Trading investments
|
|
915
|
|
|
552
|
|
||
Other investments
|
|
578
|
|
|
456
|
|
||
Other assets
|
|
66
|
|
|
63
|
|
||
Total investments and other assets
|
|
1,559
|
|
|
1,071
|
|
||
Liabilities of consolidated VIEs
|
|
(369
|
)
|
|
(216
|
)
|
||
Noncontrolling interests
|
|
(375
|
)
|
|
(207
|
)
|
||
BlackRock's net interests in consolidated VIEs
|
|
$
|
959
|
|
|
$
|
732
|
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Nonoperating net gain (loss) on consolidated VIEs
|
|
$
|
118
|
|
|
$
|
16
|
|
|
$
|
58
|
|
Net gain (loss) attributable to NCI on consolidated VIEs
|
|
$
|
33
|
|
|
$
|
(2
|
)
|
|
$
|
6
|
|
(in millions)
At December 31, 2017
|
|
Investments
|
|
Advisory
Fee
Receivables
|
|
Other Net
Assets
(Liabilities)
|
|
Maximum
Risk of Loss
(1)
|
||||||||
Sponsored investment products
|
|
$
|
263
|
|
|
$
|
15
|
|
|
$
|
(7
|
)
|
|
$
|
295
|
|
At December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Sponsored investment products
|
|
$
|
171
|
|
|
$
|
9
|
|
|
$
|
(8
|
)
|
|
$
|
197
|
|
(1)
|
At December 31, 2017 and 2016, BlackRock’s maximum risk of loss associated with these VIEs primarily related to BlackRock’s investments and collecting advisory fee receivables.
|
December 31, 2017
(in millions)
|
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Investments Measured at NAV
(1)
|
|
Other Assets
Not Held at
Fair Value
(2)
|
|
December 31,
2017
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Available-for-sale
|
|
$
|
7
|
|
|
$
|
96
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
103
|
|
Held-to-maturity debt securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
102
|
|
|
102
|
|
||||||
Trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deferred compensation plan mutual funds
|
|
56
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56
|
|
||||||
Equity securities / Multi-asset mutual funds
|
|
493
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
493
|
|
||||||
Debt securities / fixed income mutual funds
|
|
2
|
|
|
284
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
286
|
|
||||||
Total trading
|
|
551
|
|
|
284
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
835
|
|
||||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity method:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity and fixed income mutual funds
|
|
183
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|
195
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
609
|
|
|
12
|
|
|
621
|
|
||||||
Total equity method
|
|
183
|
|
|
—
|
|
|
—
|
|
|
621
|
|
|
12
|
|
|
816
|
|
||||||
Cost method investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
93
|
|
|
93
|
|
||||||
Carried interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
|
32
|
|
||||||
Total investments
|
|
741
|
|
|
380
|
|
|
—
|
|
|
621
|
|
|
239
|
|
|
1,981
|
|
||||||
Separate account assets
|
|
114,422
|
|
|
34,582
|
|
|
—
|
|
|
—
|
|
|
933
|
|
|
149,937
|
|
||||||
Separate account collateral held under securities lending
agreements:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity securities
|
|
18,778
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,778
|
|
||||||
Debt securities
|
|
—
|
|
|
5,412
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,412
|
|
||||||
Total separate account collateral held under
securities lending agreements
|
|
18,778
|
|
|
5,412
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,190
|
|
||||||
Investments of consolidated VIEs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity securities
|
|
440
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
440
|
|
||||||
Debt securities
|
|
—
|
|
|
475
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
475
|
|
||||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Private / public equity
(3)
|
|
6
|
|
|
2
|
|
|
116
|
|
|
59
|
|
|
76
|
|
|
259
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
—
|
|
|
53
|
|
||||||
Carried interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
266
|
|
|
266
|
|
||||||
Total investments of consolidated VIEs
|
|
446
|
|
|
477
|
|
|
116
|
|
|
112
|
|
|
342
|
|
|
1,493
|
|
||||||
Total
|
|
$
|
134,387
|
|
|
$
|
40,851
|
|
|
$
|
116
|
|
|
$
|
733
|
|
|
$
|
1,514
|
|
|
$
|
177,601
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Separate account collateral liabilities under
securities lending agreements
|
|
$
|
18,778
|
|
|
$
|
5,412
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,190
|
|
Other liabilities
(4)
|
|
—
|
|
|
7
|
|
|
236
|
|
|
—
|
|
|
—
|
|
|
243
|
|
||||||
Total
|
|
$
|
18,778
|
|
|
$
|
5,419
|
|
|
$
|
236
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,433
|
|
(1)
|
Amounts are comprised of certain investments measured at fair value using NAV (or its equivalent) as a practical expedient.
|
(2)
|
Amounts are comprised of investments held at cost or amortized cost, carried interest and certain equity method investments, which include sponsored investment funds and other assets, which are not accounted for under a fair value measure. In accordance with GAAP, certain equity method investees do not account for both their financial assets and liabilities under fair value measures; therefore, the Company’s investment in such equity method investees may not represent fair value.
|
(3)
|
Level 3 amounts primarily include direct investments in private equity companies held by private equity funds.
|
(4)
|
Amounts primarily include contingent liabilities related to certain acquisitions (see Note 13,
Commitments and Contingencies
, for more information).
|
December 31, 2016
(in millions)
|
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Investments Measured at NAV
(1)
|
|
Other Assets
Not Held at
Fair Value
(2)
|
|
December 31,
2016
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Available-for-sale
|
|
$
|
7
|
|
|
$
|
49
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
80
|
|
Held-to-maturity debt securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|
51
|
|
||||||
Trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deferred compensation plan mutual funds
|
|
59
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59
|
|
||||||
Equity securities / Multi-asset mutual funds
|
|
308
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
308
|
|
||||||
Debt securities / fixed income mutual funds
|
|
1
|
|
|
250
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
258
|
|
||||||
Total trading
|
|
368
|
|
|
250
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
625
|
|
||||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity method:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity and fixed income mutual funds
|
|
323
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
328
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
394
|
|
|
8
|
|
|
402
|
|
||||||
Total equity method
|
|
323
|
|
|
—
|
|
|
—
|
|
|
399
|
|
|
8
|
|
|
730
|
|
||||||
Cost method investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
91
|
|
|
91
|
|
||||||
Carried interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
18
|
|
||||||
Total investments
|
|
698
|
|
|
299
|
|
|
31
|
|
|
399
|
|
|
168
|
|
|
1,595
|
|
||||||
Separate account assets
|
|
109,663
|
|
|
38,542
|
|
|
—
|
|
|
—
|
|
|
884
|
|
|
149,089
|
|
||||||
Separate account collateral held under securities lending
agreements:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity securities
|
|
22,173
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,173
|
|
||||||
Debt securities
|
|
—
|
|
|
5,619
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,619
|
|
||||||
Total separate account collateral held under
securities lending agreements
|
|
22,173
|
|
|
5,619
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,792
|
|
||||||
Investments of consolidated VIEs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity securities
|
|
278
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
278
|
|
||||||
Debt securities
|
|
—
|
|
|
274
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
274
|
|
||||||
Other investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Private / public equity
(3)
|
|
3
|
|
|
2
|
|
|
112
|
|
|
89
|
|
|
79
|
|
|
285
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63
|
|
|
—
|
|
|
63
|
|
||||||
Carried interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
108
|
|
|
108
|
|
||||||
Total investments of consolidated VIEs
|
|
281
|
|
|
276
|
|
|
112
|
|
|
152
|
|
|
187
|
|
|
1,008
|
|
||||||
Total
|
|
$
|
132,815
|
|
|
$
|
44,736
|
|
|
$
|
143
|
|
|
$
|
551
|
|
|
$
|
1,239
|
|
|
$
|
179,484
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Separate account collateral liabilities under
securities lending agreements
|
|
$
|
22,173
|
|
|
$
|
5,619
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
27,792
|
|
Other liabilities
(4)
|
|
—
|
|
|
7
|
|
|
115
|
|
|
—
|
|
|
—
|
|
|
122
|
|
||||||
Total
|
|
$
|
22,173
|
|
|
$
|
5,626
|
|
|
$
|
115
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
27,914
|
|
(1)
|
Amounts are comprised of certain investments measured at fair value using NAV (or its equivalent) as a practical expedient.
|
(2)
|
Amounts are comprised of investments held at cost or amortized cost, carried interest and certain equity method investments, which include sponsored investment funds and other assets, which are not accounted for under a fair value measure. In accordance with GAAP, certain equity method investees do not account for both their financial assets and liabilities under fair value measures; therefore, the Company’s investment in such equity method investees may not represent fair value.
|
(3)
|
Level 3 amounts include direct investments in private equity companies held by private equity funds.
|
(4)
|
Amounts primarily include contingent liabilities related to certain acquisitions (see Note 13,
Commitments and Contingencies
, for more information).
|
(in millions)
|
|
December 31,
2016
|
|
Realized
and
Unrealized
Gains
(Losses) in
Earnings
and OCI
|
|
Purchases
|
|
Sales and
Maturities
|
|
Issuances
and
Other
Settlements
(1)
|
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
(2)
|
|
December 31,
2017
|
|
Total Net
Unrealized
Gains (Losses)
Included in
Earnings
(3)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Available-for-sale securities
(4)
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(47
|
)
|
|
$
|
—
|
|
|
|
|
|
Trading
|
|
7
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
|
|
|||||||||
Total investments
|
|
31
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(61
|
)
|
|
—
|
|
|
|
||||||||||
Assets of consolidated VIEs - Private equity
|
|
112
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
116
|
|
|
$
|
4
|
|
||||||||
Total Level 3 assets
|
|
$
|
143
|
|
|
$
|
4
|
|
|
$
|
30
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(61
|
)
|
|
$
|
116
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Other liabilities
(5)
|
|
$
|
115
|
|
|
$
|
(10
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
111
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
236
|
|
|
$
|
(10
|
)
|
(1)
|
Issuance and other settlements amount includes $120 million and $9 million of contingent liabilities in connection with the acquisition of the equity infrastructure franchise of First Reserve in June 2017 (“First Reserve Transaction”) and the acquisition of Cachematrix in July 2017 (“Cachematrix Transaction”), respectively, offset by contingent liability payments in connection with certain prior acquisitions.
|
(2)
|
Amounts include transfers out of Level 3 due to availability of observable market inputs from pricing vendors.
|
(4)
|
Amounts include investments in CLOs.
|
(5)
|
Other liabilities amount includes contingent liabilities in connection with certain acquisitions.
|
(in millions)
|
|
December 31,
2015
|
|
Realized
and
Unrealized
Gains
(Losses) in
Earnings
and OCI
|
|
Purchases
|
|
Sales and
Maturities
|
|
Issuances
and
Other
Settlements
(1)
|
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
(2)
|
|
December 31,
2016
|
|
Total Net
Unrealized
Gains (Losses)
Included in
Earnings
(3)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Available-for-sale securities
(4)
|
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(46
|
)
|
|
$
|
24
|
|
|
|
|
|
Trading
|
|
2
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
7
|
|
|
|
|
|||||||||
Total investments
|
|
25
|
|
|
—
|
|
|
55
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(49
|
)
|
|
31
|
|
|
|
||||||||||
Assets of consolidated VIEs - Private equity
|
|
196
|
|
|
3
|
|
|
6
|
|
|
(15
|
)
|
|
—
|
|
|
—
|
|
|
(78
|
)
|
|
112
|
|
|
$
|
3
|
|
||||||||
Total Level 3 assets
|
|
$
|
221
|
|
|
$
|
3
|
|
|
$
|
61
|
|
|
$
|
(15
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(127
|
)
|
|
$
|
143
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Other liabilities
(5)
|
|
$
|
48
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
70
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
115
|
|
|
$
|
3
|
|
(1)
|
Issuances and other settlements amount includes a contingent liability related to the BofA
®
Global Capital Management transaction in April 2016.
|
(2)
|
Amounts include transfers out of Level 3 due to availability of observable market inputs from pricing vendors.
|
(3)
|
Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date.
|
(4)
|
Amounts include investments in CLOs.
|
(5)
|
Other liabilities amount includes contingent liabilities and payments of contingent liabilities in connection with certain acquisitions.
|
|
|
December 31, 2017
|
|
December 31, 2016
|
|
|
|
|
|||||||||||||
(in millions)
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Fair Value
Hierarchy
|
|
|
|||||||||
Financial Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
|
$
|
6,894
|
|
|
$
|
6,894
|
|
|
$
|
6,091
|
|
|
$
|
6,091
|
|
|
Level 1
|
|
(1) (2)
|
|
Accounts receivable
|
|
2,699
|
|
|
2,699
|
|
|
2,115
|
|
|
2,115
|
|
|
Level 1
|
|
(3
|
)
|
||||
Cash and cash equivalents of consolidated VIEs
|
|
144
|
|
|
144
|
|
|
84
|
|
|
84
|
|
|
Level 1
|
|
(1) (2)
|
|||||
Other assets
|
|
70
|
|
|
70
|
|
|
25
|
|
|
25
|
|
|
Level 1
|
|
(1) (4)
|
|||||
Financial Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and accrued liabilities
|
|
1,161
|
|
|
1,161
|
|
|
880
|
|
|
880
|
|
|
Level 1
|
|
(3
|
)
|
||||
Long-term borrowings
|
|
5,014
|
|
|
5,225
|
|
|
4,915
|
|
|
5,165
|
|
|
Level 2
|
|
(5
|
)
|
(1)
|
Cash and cash equivalents are carried at either cost or amortized cost, which approximates fair value due to their short-term maturities.
|
(2)
|
At December 31, 2017 and 2016, approximately $163 million and $132 million of money market funds were recorded within cash and cash equivalents on the consolidated statements of financial condition. In addition, at December 31, 2017 and 2016, approximately $14 million and $13 million, respectively, of money market funds were recorded within cash and cash equivalents of consolidated VIEs. Money market funds are valued based on quoted market prices, or $1.00 per share, which generally is the NAV of the fund.
|
(3)
|
The carrying amounts of accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short-term nature.
|
(4)
|
Other assets primarily include restricted cash.
|
(5)
|
Long-term borrowings are recorded at amortized cost, net of debt issuance costs. The fair value of the long-term borrowings, including the current portion of long-term borrowings, is estimated using market prices at the end of
|
(in millions)
|
|
Ref
|
|
Fair Value
|
|
Total
Unfunded
Commitments
|
|
Redemption
Frequency
|
|
Redemption
Notice Period
|
||||
Equity method:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Hedge funds/funds of hedge funds
|
|
(a)
|
|
$
|
230
|
|
|
$
|
48
|
|
|
Daily/Monthly (21%)
Quarterly (49%)
N/R (30%)
|
|
1 – 90 days
|
Private equity funds
|
|
(b)
|
|
94
|
|
|
86
|
|
|
N/R
|
|
N/R
|
||
Real assets funds
|
|
(c)
|
|
282
|
|
|
69
|
|
|
Quarterly (83%)
N/R (17%)
|
|
60 days
|
||
Other
|
|
|
|
15
|
|
|
14
|
|
|
Daily (80%)
N/R (20%)
|
|
5 days
|
||
Consolidated VIEs:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Private equity funds of funds
|
|
(d)
|
|
59
|
|
|
20
|
|
|
N/R
|
|
N/R
|
||
Hedge fund
|
|
(a)
|
|
19
|
|
|
—
|
|
|
Quarterly
|
|
90 days
|
||
Real assets funds
|
|
(c)
|
|
34
|
|
|
49
|
|
|
NR
|
|
NR
|
||
Total
|
|
|
|
$
|
733
|
|
|
$
|
286
|
|
|
|
|
|
(in millions)
|
|
Ref
|
|
Fair Value
|
|
Total
Unfunded
Commitments
|
|
Redemption
Frequency
|
|
Redemption
Notice Period
|
||||
Equity method:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Hedge funds/funds of hedge funds
|
|
(a)
|
|
$
|
237
|
|
|
$
|
14
|
|
|
Daily/Monthly (21%)
Quarterly (51%)
N/R (28%)
|
|
1 – 90 days
|
Private equity funds
|
|
(b)
|
|
90
|
|
|
62
|
|
|
N/R
|
|
N/R
|
||
Real assets funds
|
|
(c)
|
|
60
|
|
|
35
|
|
|
Quarterly (41%)
N/R (59%)
|
|
60 days
|
||
Other
|
|
|
|
12
|
|
|
9
|
|
|
Daily/Monthly (42%)
N/R (58%)
|
|
3-5 days
|
||
Consolidated VIEs:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Private equity funds of funds
|
|
(d)
|
|
89
|
|
|
16
|
|
|
N/R
|
|
N/R
|
||
Hedge fund
|
|
(a)
|
|
36
|
|
|
—
|
|
|
Quarterly
|
|
90 days
|
||
Real assets funds
|
|
(c)
|
|
27
|
|
|
21
|
|
|
NR
|
|
NR
|
||
Total
|
|
|
|
$
|
551
|
|
|
$
|
157
|
|
|
|
|
|
(1)
|
Comprised of equity method investments, which include investment companies, which account for their financial assets and most financial liabilities under fair value measures; therefore, the Company’s investment in such equity method investees approximates fair value.
|
(2)
|
This category includes hedge funds and funds of hedge funds that invest primarily in equities, fixed income securities, distressed credit, opportunistic and mortgage instruments and other third-party hedge funds. The fair values of the investments have been estimated using the NAV of the Company’s ownership interest in partners’ capital. It was estimated that the investments in the funds that are not subject to redemption will be liquidated over a weighted-average period of seven years at December 31, 2017 and approximately one year at December 31, 2016.
|
(3)
|
This category includes several private equity funds that initially invest in nonmarketable securities of private companies, which ultimately may become public in the future. The fair values of these investments have been estimated using capital accounts representing the Company’s ownership interest in the funds as well as other performance inputs. The Company’s investment in each fund is not subject to redemption and is normally returned through distributions as a result of the liquidation of the underlying assets of the private equity funds. It was estimated that the investments in these funds will be liquidated over a weighted-average period of approximately six years and five years at December 31, 2017 and 2016, respectively.
|
|
|
Estimated useful
|
|
December 31,
|
|||||||
(in millions)
|
|
life-in years
|
|
2,017,000,000
|
|
2,016,000,000
|
|||||
Property and equipment:
|
|
|
|
|
|
|
|
|
|
||
Land
|
|
N/A
|
|
|
$
|
6
|
|
|
$
|
6
|
|
Building
|
|
39
|
|
|
33
|
|
|
33
|
|
||
Building improvements
|
|
15
|
|
|
29
|
|
|
29
|
|
||
Leasehold improvements
|
|
1-15
|
|
|
504
|
|
|
476
|
|
||
Equipment and computer software
|
|
3
|
|
|
444
|
|
|
411
|
|
||
Other transportation equipment
|
|
10
|
|
|
134
|
|
|
135
|
|
||
Furniture and fixtures
|
|
7
|
|
|
67
|
|
|
65
|
|
||
Construction in progress
|
|
N/A
|
|
|
33
|
|
|
5
|
|
||
Total
|
|
|
|
|
1,250
|
|
|
1,160
|
|
||
Less: accumulated depreciation and amortization
|
|
|
|
|
658
|
|
|
601
|
|
||
Property and equipment, net
|
|
|
|
|
$
|
592
|
|
|
$
|
559
|
|
N/A
|
– Not Applicable
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
||||
Beginning of year balance
|
|
$
|
13,118
|
|
|
$
|
13,123
|
|
Acquisitions
(1)
|
|
121
|
|
|
14
|
|
||
Goodwill adjustments related to Quellos
(2)
|
|
(19
|
)
|
|
(19
|
)
|
||
End of year balance
|
|
$
|
13,220
|
|
|
$
|
13,118
|
|
(1)
|
In 2017, the $121 million increase includes $91 million of goodwill related to the First Reserve Transaction, which expanded the Company’s energy and power infrastructure platform and $30 million of goodwill related to the Cachematrix Transaction, which enhanced the Company’s technology and cash management capabilities. The total consideration paid for the First Reserve Transaction was approximately $193 million, including $120 million of contingent consideration at fair value at time of close. The total consideration paid for the Cachematrix Transaction was approximately $38 million, including $9 million of contingent consideration at fair value at time of close. In 2016, the $14 million increase represents goodwill from the BofA Global Capital Management transaction in April 2016 that transferred investment management responsibilities of approximately $80.6 billion of cash assets under management to the Company. Total consideration included $75 million of contingent consideration at fair value at time of close. BlackRock’s platform provides clients with broad access to high quality, global liquidity investment solutions.
|
(1)
|
The decrease in goodwill during both 2017 and 2016 resulted from a decline related to tax benefits realized from tax-deductible goodwill in excess of book goodwill from the acquisition of the fund-of-funds business of Quellos Group, LLC in October 2007 (the “Quellos Transaction”). Goodwill related to the Quellos Transaction will continue to be reduced in future periods by the amount of tax benefits realized from tax-deductible goodwill in excess of book goodwill from the Quellos Transaction. The balance of the Quellos tax-deductible goodwill in excess of book goodwill was approximately $168 million and $200 million at December 31, 2017 and 2016, respectively.
|
(in millions)
|
|
Remaining
Weighted-
Average
Estimated
Useful Life
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net Carrying
Amount
|
|||||||
At December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Management contracts
|
|
N/A
|
|
|
$
|
15,769
|
|
|
$
|
—
|
|
|
$
|
15,769
|
|
Trade names / trademarks
|
|
N/A
|
|
|
1,403
|
|
|
—
|
|
|
1,403
|
|
|||
License
|
|
N/A
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|||
Total indefinite-lived intangible assets
|
|
|
|
|
17,178
|
|
|
—
|
|
|
17,178
|
|
|||
Finite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Management contracts
|
|
5.3
|
|
|
379
|
|
|
212
|
|
|
167
|
|
|||
Investor/customer relationships
|
|
11.2
|
|
|
45
|
|
|
2
|
|
|
43
|
|
|||
Intellectual property
|
|
0.6
|
|
|
6
|
|
|
5
|
|
|
1
|
|
|||
Total finite-lived intangible assets
|
|
6.5
|
|
|
430
|
|
|
219
|
|
|
211
|
|
|||
Total intangible assets
|
|
|
|
|
$
|
17,608
|
|
|
$
|
219
|
|
|
$
|
17,389
|
|
At December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Indefinite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Management contracts
|
|
N/A
|
|
|
$
|
15,769
|
|
|
$
|
—
|
|
|
$
|
15,769
|
|
Trade names / trademarks
|
|
N/A
|
|
|
1,403
|
|
|
—
|
|
|
1,403
|
|
|||
License
|
|
N/A
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|||
Total indefinite-lived intangible assets
|
|
|
|
|
17,178
|
|
|
—
|
|
|
17,178
|
|
|||
Finite-lived intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Management contracts
|
|
3.9
|
|
|
1,011
|
|
|
827
|
|
|
184
|
|
|||
Intellectual property
|
|
1.6
|
|
|
6
|
|
|
5
|
|
|
1
|
|
|||
Total finite-lived intangible assets
|
|
3.8
|
|
|
1,017
|
|
|
832
|
|
|
185
|
|
|||
Total intangible assets
|
|
|
|
|
$
|
18,195
|
|
|
$
|
832
|
|
|
$
|
17,363
|
|
N/A
|
— Not Applicable
|
(in millions)
|
|
|
||
Year
|
Amount
|
|||
2,018,000,000
|
|
$
|
45
|
|
2,019,000,000
|
|
44
|
|
|
2,020,000,000
|
|
29
|
|
|
2,021,000,000
|
|
27
|
|
|
2,022,000,000
|
|
18
|
|
(in millions)
|
|
Maturity
Amount
|
|
Unamortized
Discount and Debt Issuance Costs
|
|
Carrying Value
|
|
Fair Value
|
||||||||
5.00% Notes due 2019
|
|
$
|
1,000
|
|
|
$
|
(1
|
)
|
|
$
|
999
|
|
|
$
|
1,051
|
|
4.25% Notes due 2021
|
|
750
|
|
|
(3
|
)
|
|
747
|
|
|
792
|
|
||||
3.375% Notes due 2022
|
|
750
|
|
|
(4
|
)
|
|
746
|
|
|
774
|
|
||||
3.50% Notes due 2024
|
|
1,000
|
|
|
(6
|
)
|
|
994
|
|
|
1,038
|
|
||||
1.25% Notes due 2025
|
|
841
|
|
|
(6
|
)
|
|
835
|
|
|
864
|
|
||||
3.20% Notes due 2027
|
|
700
|
|
|
(7
|
)
|
|
693
|
|
|
706
|
|
||||
Total Long-term Borrowings
|
|
$
|
5,041
|
|
|
$
|
(27
|
)
|
|
$
|
5,014
|
|
|
$
|
5,225
|
|
(in millions)
|
|
|
||
Year
|
Amount
|
|||
2,018,000,000
|
|
141
|
|
|
2,019,000,000
|
|
132
|
|
|
2,020,000,000
|
|
126
|
|
|
2,021,000,000
|
|
118
|
|
|
2,022,000,000
|
|
109
|
|
|
Thereafter
|
1,580
|
|
||
Total
|
$
|
2,206
|
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Stock-based compensation:
|
|
|
|
|
|
|
|
|
|
|||
Restricted stock and RSUs
|
|
$
|
524
|
|
|
$
|
493
|
|
|
$
|
484
|
|
Long-term incentive plans to be funded by PNC
|
|
15
|
|
|
28
|
|
|
30
|
|
|||
Stock options
|
|
3
|
|
|
—
|
|
|
—
|
|
|||
Total stock-based compensation
|
|
$
|
542
|
|
|
$
|
521
|
|
|
$
|
514
|
|
Outstanding at
|
|
Restricted
Stock and
RSUs
|
|
Weighted-
Average
Grant Date
Fair Value
|
|||
December 31, 2016
|
|
2,987,588
|
|
|
$
|
318.04
|
|
Granted
|
|
1,104,210
|
|
|
$
|
381.62
|
|
Converted
|
|
(1,424,649
|
)
|
|
$
|
321.12
|
|
Forfeited
|
|
(58,481
|
)
|
|
$
|
339.17
|
|
December 31, 2017
(1)
|
|
2,608,668
|
|
|
$
|
342.79
|
|
(1)
|
At December 31, 2017, approximately 2.3 million awards are expected to vest and 0.3 million awards have vested but have not been converted.
|
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
|||
Awards granted that vest ratably over three years from the date of grant
|
|
699,991
|
|
|
1,030,964
|
|
|
952,329
|
|
Awards granted that cliff vest 100% on:
|
|
|
|
|
|
|
|
|
|
January 31, 2018
|
|
—
|
|
|
—
|
|
|
303,999
|
|
January 31, 2019
|
|
—
|
|
|
303,587
|
|
|
—
|
|
January 31, 2020
|
|
277,313
|
|
|
—
|
|
|
—
|
|
|
|
977,304
|
|
|
1,334,551
|
|
|
1,256,328
|
|
•
|
527,337 RSUs or shares of restricted stock to employees as part of annual incentive compensation that vest ratably over three years from the date of grant; and
|
•
|
209,201 RSUs or shares of restricted stock to employees that cliff vest 100% on January 31, 2021.
|
Outstanding at
|
|
Performance-
Based RSUs
|
|
Weighted-
Average
Grant Date
Fair Value
|
|||
December 31, 2016
|
|
610,371
|
|
|
$
|
315.65
|
|
Granted
|
|
294,584
|
|
|
$
|
375.27
|
|
Forfeited
|
|
(1,430
|
)
|
|
$
|
296.12
|
|
December 31, 2017
|
|
903,525
|
|
|
$
|
335.12
|
|
Outstanding at
|
|
Market
Performance-
Based RSUs
|
|
Weighted-
Average
Grant Date
Fair Value
|
|||
December 31, 2016
|
|
803,474
|
|
|
$
|
151.20
|
|
Converted
|
|
(517,138
|
)
|
|
$
|
126.76
|
|
December 31, 2017
(1)
|
|
286,336
|
|
|
$
|
195.33
|
|
(1)
|
At December 31, 2017, approximately 0.3 million awards are expected to vest on January 31, 2018.
|
Outstanding at
|
|
Shares
Under
Option
|
|
Weighted
Average
Exercise
Price
|
|||
December 31, 2016
|
|
—
|
|
|
$
|
—
|
|
Granted
|
|
2,147,562
|
|
|
$
|
513.50
|
|
December 31, 2017
|
|
2,147,562
|
|
|
$
|
513.50
|
|
Grant
Year
|
|
Expected Term (Years)
|
|
Expected Stock Volatility
|
|
Expected Dividend Yield
|
|
Risk-Free Interest Rate
|
|||||
2,017,000,000
|
|
|
6.56
|
|
|
22.23
|
%
|
|
2.16
|
%
|
|
2.33
|
%
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Investment advisory, administration fees and securities lending revenue
(1)
|
|
$
|
7,740
|
|
|
$
|
6,836
|
|
|
$
|
6,875
|
|
Investment advisory performance fees
|
|
143
|
|
|
125
|
|
|
129
|
|
|||
Technology and risk management revenue
(2)
|
|
7
|
|
|
7
|
|
|
7
|
|
|||
Advisory and other revenue
(3)
|
|
58
|
|
|
90
|
|
|
73
|
|
|||
Total revenue from related parties
|
|
$
|
7,948
|
|
|
$
|
7,058
|
|
|
$
|
7,084
|
|
(1)
|
Amount primarily includes revenue from registered investment companies/and equity method investees.
|
(2)
|
Amount primarily includes revenue from PNC and affiliates.
|
(3)
|
Amount primarily includes revenue from equity method investees.
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
General and administration expense:
|
|
|
|
|
|
|
|
|
|
|||
Registered investment companies
|
|
$
|
60
|
|
|
$
|
61
|
|
|
$
|
60
|
|
Other
|
|
9
|
|
|
4
|
|
|
18
|
|
|||
Total general and administration expense
|
|
$
|
69
|
|
|
$
|
65
|
|
|
$
|
78
|
|
|
|
Actual
|
|
For Capital
Adequacy
Purposes
|
|
To Be Well
Capitalized
Under Prompt
Corrective Action
Provisions
|
|||||||||||||||
(in millions)
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total capital (to risk weighted assets)
|
|
$
|
1,124
|
|
|
111.7
|
%
|
|
$
|
81
|
|
|
8.0
|
%
|
|
$
|
101
|
|
|
10.0
|
%
|
Common Equity Tier 1 capital (to risk weighted assets)
|
|
$
|
1,124
|
|
|
111.7
|
%
|
|
$
|
45
|
|
|
4.5
|
%
|
|
$
|
65
|
|
|
6.5
|
%
|
Tier 1 capital (to risk weighted assets)
|
|
$
|
1,124
|
|
|
111.7
|
%
|
|
$
|
60
|
|
|
6.0
|
%
|
|
$
|
81
|
|
|
8.0
|
%
|
Tier 1 capital (to average assets)
|
|
$
|
1,124
|
|
|
70.5
|
%
|
|
$
|
64
|
|
|
4.0
|
%
|
|
$
|
80
|
|
|
5.0
|
%
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total capital (to risk weighted assets)
|
|
$
|
1,211
|
|
|
92.5
|
%
|
|
$
|
105
|
|
|
8.0
|
%
|
|
$
|
131
|
|
|
10.0
|
%
|
Common Equity Tier 1 capital (to risk weighted assets)
|
|
$
|
1,211
|
|
|
92.5
|
%
|
|
$
|
59
|
|
|
4.5
|
%
|
|
$
|
85
|
|
|
6.5
|
%
|
Tier 1 capital (to risk weighted assets)
|
|
$
|
1,211
|
|
|
92.5
|
%
|
|
$
|
79
|
|
|
6.0
|
%
|
|
$
|
105
|
|
|
8.0
|
%
|
Tier 1 capital (to average assets)
|
|
$
|
1,211
|
|
|
65.3
|
%
|
|
$
|
74
|
|
|
4.0
|
%
|
|
$
|
93
|
|
|
5.0
|
%
|
(in millions)
|
|
Foreign currency translation adjustments
(1)
|
|
Other
(2)
|
|
Total
|
||||||
December 31, 2014
|
|
$
|
(279
|
)
|
|
$
|
6
|
|
|
$
|
(273
|
)
|
Net other comprehensive income (loss) for 2015
|
|
(173
|
)
|
|
(2
|
)
|
|
(175
|
)
|
|||
December 31, 2015
|
|
$
|
(452
|
)
|
|
$
|
4
|
|
|
$
|
(448
|
)
|
Net other comprehensive income (loss) for 2016
|
|
(269
|
)
|
|
1
|
|
|
(268
|
)
|
|||
December 31, 2016
|
|
$
|
(721
|
)
|
|
$
|
5
|
|
|
$
|
(716
|
)
|
Net other comprehensive income (loss) for 2017
|
|
285
|
|
|
(1
|
)
|
|
284
|
|
|||
December 31, 2017
|
|
$
|
(436
|
)
|
|
$
|
4
|
|
|
$
|
(432
|
)
|
(1)
|
Amount for 2017 includes a loss from a net investment hedge of $64 million (net of a tax benefit of $38 million). Amount for 2016 and 2015 include a gain from a net investment hedge of $14 million (net of tax of $8 million) and $19 million (net of tax of $11 million), respectively.
|
(2)
|
Other includes amounts related to benefit plans and available-for-sale investments and are presented net of tax. Amounts reclassified to AOCI were not material for 2017, 2016, and 2015.
|
|
|
December 31,
2017
|
|
December 31,
2016
|
||
Common Stock
|
|
500,000,000
|
|
|
500,000,000
|
|
Nonvoting Participating Preferred Stock
|
|
|
|
|
|
|
Series A Preferred
|
|
20,000,000
|
|
|
20,000,000
|
|
Series B Preferred
|
|
150,000,000
|
|
|
150,000,000
|
|
Series C Preferred
|
|
6,000,000
|
|
|
6,000,000
|
|
Series D Preferred
|
|
20,000,000
|
|
|
20,000,000
|
|
|
|
Shares Issued
|
|
Shares Outstanding
|
|||||||||||||||||
|
|
Common
Shares
|
|
Treasury
Common
Shares
|
|
Series B
Preferred
|
|
Series C
Preferred
|
|
Common
Shares
|
|
Series B
Preferred
|
|
Series C
Preferred
|
|||||||
December 31, 2014
|
|
171,252,185
|
|
|
(6,465,397
|
)
|
|
823,188
|
|
|
1,311,887
|
|
|
164,786,788
|
|
|
823,188
|
|
|
1,311,887
|
|
Shares repurchased
|
|
—
|
|
|
(3,080,689
|
)
|
|
—
|
|
|
—
|
|
|
(3,080,689
|
)
|
|
—
|
|
|
—
|
|
Net issuance of common shares related to
employee stock transactions
|
|
—
|
|
|
1,754,965
|
|
|
—
|
|
|
—
|
|
|
1,754,965
|
|
|
—
|
|
|
—
|
|
December 31, 2015
|
|
171,252,185
|
|
|
(7,791,121
|
)
|
|
823,188
|
|
|
1,311,887
|
|
|
163,461,064
|
|
|
823,188
|
|
|
1,311,887
|
|
Shares repurchased
|
|
—
|
|
|
(3,264,935
|
)
|
|
—
|
|
|
—
|
|
|
(3,264,935
|
)
|
|
—
|
|
|
—
|
|
Net issuance of common shares related to
employee stock transactions
|
|
—
|
|
|
1,338,314
|
|
|
—
|
|
|
—
|
|
|
1,338,314
|
|
|
—
|
|
|
—
|
|
PNC LTIP capital contribution
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(548,227
|
)
|
|
—
|
|
|
—
|
|
|
(548,227
|
)
|
December 31, 2016
|
|
171,252,185
|
|
|
(9,717,742
|
)
|
|
823,188
|
|
|
763,660
|
|
|
161,534,443
|
|
|
823,188
|
|
|
763,660
|
|
Shares repurchased
|
|
—
|
|
|
(2,647,670
|
)
|
|
—
|
|
|
—
|
|
|
(2,647,670
|
)
|
|
—
|
|
|
—
|
|
Net issuance of common shares related to
employee stock transactions
|
|
—
|
|
|
1,090,342
|
|
|
—
|
|
|
—
|
|
|
1,090,342
|
|
|
—
|
|
|
—
|
|
PNC LTIP capital contribution
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(517,138
|
)
|
|
—
|
|
|
—
|
|
|
(517,138
|
)
|
December 31, 2017
|
|
171,252,185
|
|
|
(11,275,070
|
)
|
|
823,188
|
|
|
246,522
|
|
|
159,977,115
|
|
|
823,188
|
|
|
246,522
|
|
(in millions)
|
|
||
Liability as of December 31, 2015
|
$
|
—
|
|
Additions
|
76
|
|
|
Cash payments
|
(44
|
)
|
|
Accelerated amortization expense of equity-based awards
|
(28
|
)
|
|
Liability as of December 31, 2016
|
$
|
4
|
|
Cash payments
|
(4
|
)
|
|
Liability as of December 31, 2017
|
$
|
—
|
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Current income tax expense:
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
$
|
1,166
|
|
|
$
|
858
|
|
|
$
|
937
|
|
State and local
|
|
36
|
|
|
61
|
|
|
74
|
|
|||
Foreign
|
|
289
|
|
|
385
|
|
|
395
|
|
|||
Total net current income tax expense
|
|
1,491
|
|
|
1,304
|
|
|
1,406
|
|
|||
Deferred income tax expense (benefit):
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
(1,382
|
)
|
|
31
|
|
|
(13
|
)
|
|||
State and local
|
|
81
|
|
|
14
|
|
|
(19
|
)
|
|||
Foreign
|
|
80
|
|
|
(59
|
)
|
|
(124
|
)
|
|||
Total net deferred income tax expense (benefit)
|
|
(1,221
|
)
|
|
(14
|
)
|
|
(156
|
)
|
|||
Total income tax expense
|
|
$
|
270
|
|
|
$
|
1,290
|
|
|
$
|
1,250
|
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Domestic
|
|
$
|
3,298
|
|
|
$
|
2,837
|
|
|
$
|
2,840
|
|
Foreign
|
|
1,942
|
|
|
1,625
|
|
|
1,755
|
|
|||
Total
|
|
$
|
5,240
|
|
|
$
|
4,462
|
|
|
$
|
4,595
|
|
(in millions)
|
|
2,017,000,000
|
|
%
|
|
2,016,000,000
|
|
%
|
|
2,015,000,000
|
|
%
|
|||||||||
Statutory income tax expense
|
|
$
|
1,834
|
|
|
35
|
%
|
|
$
|
1,562
|
|
|
35
|
%
|
|
$
|
1,608
|
|
|
35
|
%
|
Increase (decrease) in income taxes resulting from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
State and local taxes (net of federal benefit)
|
|
60
|
|
|
1
|
|
|
69
|
|
|
2
|
|
|
42
|
|
|
1
|
|
|||
Impact of federal, foreign, state, and local tax rate changes on deferred taxes
|
|
(1,637
|
)
|
|
(31
|
)
|
|
(33
|
)
|
|
(1
|
)
|
|
(45
|
)
|
|
(1
|
)
|
|||
Mandatory deemed repatriation tax
|
|
477
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Stock-based compensation awards
|
|
(159
|
)
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Effect of foreign tax rates
|
|
(337
|
)
|
|
(6
|
)
|
|
(329
|
)
|
|
(7
|
)
|
|
(385
|
)
|
|
(8
|
)
|
|||
Other
|
|
32
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|||
Income tax expense
|
|
$
|
270
|
|
|
5
|
%
|
|
$
|
1,290
|
|
|
29
|
%
|
|
$
|
1,250
|
|
|
27
|
%
|
|
|
December 31,
|
||||||
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
||||
Deferred income tax assets:
|
|
|
|
|
|
|
||
Compensation and benefits
|
|
$
|
187
|
|
|
$
|
399
|
|
Unrealized investment losses
|
|
28
|
|
|
42
|
|
||
Loss carryforwards
|
|
84
|
|
|
85
|
|
||
Foreign tax credit carryforwards
|
|
—
|
|
|
118
|
|
||
Other
|
|
116
|
|
|
216
|
|
||
Gross deferred tax assets
|
|
415
|
|
|
860
|
|
||
Less: deferred tax valuation allowances
|
|
(22
|
)
|
|
(22
|
)
|
||
Deferred tax assets net of valuation allowances
|
|
393
|
|
|
838
|
|
||
Deferred income tax liabilities:
|
|
|
|
|
|
|
||
Goodwill and acquired indefinite-lived intangibles
|
|
3,810
|
|
|
5,568
|
|
||
Acquired finite-lived intangibles
|
|
40
|
|
|
36
|
|
||
Other
|
|
62
|
|
|
54
|
|
||
Gross deferred tax liabilities
|
|
3,912
|
|
|
5,658
|
|
||
Net deferred tax (liabilities)
|
|
$
|
(3,519
|
)
|
|
$
|
(4,820
|
)
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Balance at January 1
|
|
$
|
410
|
|
|
$
|
466
|
|
|
$
|
379
|
|
Additions for tax positions of prior years
|
|
161
|
|
|
3
|
|
|
39
|
|
|||
Reductions for tax positions of prior years
|
|
(3
|
)
|
|
(78
|
)
|
|
(25
|
)
|
|||
Additions based on tax positions related to current year
|
|
67
|
|
|
37
|
|
|
75
|
|
|||
Lapse of statute of limitations
|
|
(6
|
)
|
|
—
|
|
|
(2
|
)
|
|||
Settlements
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|||
Balance at December 31
|
|
$
|
629
|
|
|
$
|
410
|
|
|
$
|
466
|
|
(in millions, except shares and per share data)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Net income attributable to BlackRock
|
|
$
|
4,970
|
|
|
$
|
3,172
|
|
|
$
|
3,345
|
|
Basic weighted-average shares outstanding
|
|
162,160,601
|
|
|
164,425,858
|
|
|
166,390,009
|
|
|||
Dilutive effect of nonparticipating RSUs and stock options
|
|
2,254,434
|
|
|
2,153,894
|
|
|
2,648,562
|
|
|||
Total diluted weighted-average shares outstanding
|
|
164,415,035
|
|
|
166,579,752
|
|
|
169,038,571
|
|
|||
Basic earnings per share
|
|
$
|
30.65
|
|
|
$
|
19.29
|
|
|
$
|
20.10
|
|
Diluted earnings per share
|
|
$
|
30.23
|
|
|
$
|
19.04
|
|
|
$
|
19.79
|
|
(in millions)
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Equity
|
|
$
|
5,722
|
|
|
$
|
5,018
|
|
|
$
|
5,345
|
|
Fixed income
|
|
2,921
|
|
|
2,664
|
|
|
2,428
|
|
|||
Multi-asset
|
|
1,181
|
|
|
1,157
|
|
|
1,287
|
|
|||
Alternatives
|
|
1,105
|
|
|
878
|
|
|
1,082
|
|
|||
Cash management
|
|
558
|
|
|
458
|
|
|
319
|
|
|||
Total investment advisory, administration fees, securities lending revenue and
performance fees
|
|
11,487
|
|
|
10,175
|
|
|
10,461
|
|
|||
Technology and risk management revenue
|
|
677
|
|
|
595
|
|
|
528
|
|
|||
Distribution fees
|
|
24
|
|
|
41
|
|
|
55
|
|
|||
Advisory and other revenue
|
|
303
|
|
|
344
|
|
|
357
|
|
|||
Total revenue
|
|
$
|
12,491
|
|
|
$
|
11,155
|
|
|
$
|
11,401
|
|
(in millions)
|
|
|
|
|
|
|
||||||
Revenue
|
|
2,017,000,000
|
|
2,016,000,000
|
|
2,015,000,000
|
||||||
Americas
|
|
$
|
8,406
|
|
|
$
|
7,530
|
|
|
$
|
7,502
|
|
Europe
|
|
3,432
|
|
|
3,083
|
|
|
3,356
|
|
|||
Asia-Pacific
|
|
653
|
|
|
542
|
|
|
543
|
|
|||
Total revenue
|
|
$
|
12,491
|
|
|
$
|
11,155
|
|
|
$
|
11,401
|
|
(in millions)
|
|
|
|
|
||||
Long-lived Assets
|
|
2,017,000,000
|
|
2,016,000,000
|
||||
Americas
|
|
$
|
13,560
|
|
|
$
|
13,424
|
|
Europe
|
|
168
|
|
|
163
|
|
||
Asia-Pacific
|
|
84
|
|
|
90
|
|
||
Total long-lived assets
|
|
$
|
13,812
|
|
|
$
|
13,677
|
|
(in millions, except shares and per share data)
|
|
|
|
|
|
|
|
|
|||||||||
2,017,000,000
|
|
|
1
st
Quarter
(1)(2)
|
|
2
nd
Quarter
|
|
3
rd
Quarter
(3)
|
|
4
th
Quarter
(4)
|
||||||||
Revenue
|
|
$
|
2,824
|
|
|
$
|
2,965
|
|
|
$
|
3,233
|
|
|
$
|
3,469
|
|
|
Operating income
|
|
$
|
1,147
|
|
|
$
|
1,242
|
|
|
$
|
1,394
|
|
|
$
|
1,489
|
|
|
Net income
|
|
$
|
871
|
|
|
$
|
867
|
|
|
$
|
959
|
|
|
$
|
2,310
|
|
|
Net income attributable to BlackRock, Inc.
|
|
$
|
862
|
|
|
$
|
857
|
|
|
$
|
947
|
|
|
$
|
2,304
|
|
|
Earnings per share attributable to BlackRock, Inc. common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
5.29
|
|
|
$
|
5.27
|
|
|
$
|
5.85
|
|
|
$
|
14.29
|
|
|
Diluted
|
|
$
|
5.23
|
|
|
$
|
5.22
|
|
|
$
|
5.78
|
|
|
$
|
14.07
|
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
163,016,599
|
|
|
162,502,465
|
|
|
161,872,716
|
|
|
161,272,950
|
|
|||||
Diluted
|
|
164,856,183
|
|
|
164,149,861
|
|
|
163,773,546
|
|
|
163,777,534
|
|
|||||
Dividend declared per share
|
|
$
|
2.50
|
|
|
$
|
2.50
|
|
|
$
|
2.50
|
|
|
$
|
2.50
|
|
|
Common stock price per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
High
|
|
$
|
397.81
|
|
|
$
|
428.38
|
|
|
$
|
447.09
|
|
|
$
|
518.86
|
|
|
Low
|
|
$
|
371.64
|
|
|
$
|
377.10
|
|
|
$
|
412.19
|
|
|
$
|
449.95
|
|
|
Close
|
|
$
|
383.51
|
|
|
$
|
422.41
|
|
|
$
|
447.09
|
|
|
$
|
513.71
|
|
2,016,000,000
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue
|
|
$
|
2,624
|
|
|
$
|
2,804
|
|
|
$
|
2,837
|
|
|
$
|
2,890
|
|
|
Operating income
|
|
$
|
963
|
|
|
$
|
1,173
|
|
|
$
|
1,209
|
|
|
$
|
1,225
|
|
|
Net income
|
|
$
|
647
|
|
|
$
|
795
|
|
|
$
|
877
|
|
|
$
|
851
|
|
|
Net income attributable to BlackRock, Inc.
|
|
$
|
657
|
|
|
$
|
789
|
|
|
$
|
875
|
|
|
$
|
851
|
|
|
Earnings per share attributable to BlackRock, Inc. common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
3.97
|
|
|
$
|
4.79
|
|
|
$
|
5.33
|
|
|
$
|
5.21
|
|
|
Diluted
|
|
$
|
3.92
|
|
|
$
|
4.73
|
|
|
$
|
5.26
|
|
|
$
|
5.13
|
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
165,388,130
|
|
|
164,758,612
|
|
|
164,129,214
|
|
|
163,441,552
|
|
|||||
Diluted
|
|
167,398,938
|
|
|
166,639,290
|
|
|
166,256,598
|
|
|
165,854,167
|
|
|||||
Dividend declared per share
|
|
$
|
2.29
|
|
|
$
|
2.29
|
|
|
$
|
2.29
|
|
|
$
|
2.29
|
|
|
Common stock price per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
High
|
|
$
|
342.56
|
|
|
$
|
367.47
|
|
|
$
|
376.00
|
|
|
$
|
398.45
|
|
|
Low
|
|
$
|
289.72
|
|
|
$
|
319.54
|
|
|
$
|
335.11
|
|
|
$
|
338.61
|
|
|
Close
|
|
$
|
340.57
|
|
|
$
|
342.53
|
|
|
$
|
362.46
|
|
|
$
|
380.54
|
|
(1)
|
The first quarter of 2016 included a pre-tax restructuring charge of $76 million.
|
(2)
|
The first quarter of 2017 included an $81 million discrete tax benefit reflecting the adoption of new accounting guidance related to stock-based compensation awards that vested in the first quarter of 2017.
|