Is PNC Bank In Trouble?
PNC Financial Services – https://www.pnc.com/
Many depositors across the country find their heads filled with fear. In addition, worry!
NordNordWest, Alexrk2, Eric Gaba (Sting – fr:Sting), Magog the Ogre – USA location map – counties.svg
Lately all we can read about these days are banks failing everywhere! Are we in a financial crisis? Now some worry Will Bank of America Collapse? And many others worry whether or not there is a Hawaii Bank Run? And of course, many others worry about the more local establishments. Will First Republic Bank Fail ? Is my money Safe in Schwab?
But, as well know, if we keep less than $250,000 in one account, we have the backing of the FDIC! See for details: FDIC insurance
However, we all worry about bank’s health. Despite the FDIC guarantee.
Let’s take a look at the broader sector!
Below we have a chart showing unrealized depreciation on Hold to Maturity Securities (HTM) for top 100 banks versus equity.
These unrealized losses are NOT reflected in profits. Or a deduct to equity via Other Comprehensive Income (OCI) – only in the footnotes! Moreover, we don’t find these losses reflected in stress tests or measures of capital adequacy.
Furthermore a 25 bp (1/4 of 1 percent) increase in rates for a 10-year security causes approximately 2 points in losses (100 par to 98 to reflect yield discount).
So let’s take a look at PNC.
PNC seems to have $4.4 billion of unrealized losses on $40 billion of book. So 11%. Pretty good!
“Net unrealized losses on available for sale securities were $4.4 billion at December 31, 2022 and $4.8 billion at September 30, 2022, compared with net unrealized gains of $0.7 billion at December 31, 2021.”
However, we don’t like that they have rising losses:
However, what we do like is below!!\
Losses of total loans remain constant! Much better than peers.
Looking good PNC Bank. Of course, nobody stops a bank run.
PNC Bank is a banking institution based in Pittsburgh, Pennsylvania, with a long history dating back to the 19th century.
The roots of PNC Bank can become traced back to the Pittsburgh Trust and Savings Company.
Which was founded in 1852. The company provided banking and financial services to individuals and businesses in the Pittsburgh area.
In 1863, the Pittsburgh Trust and Savings Company was one of the first banks to receive a national charter under the National Bank Act. The bank continued to grow and expand its services, and in 1877, it changed its name to the Pittsburgh National Bank.
Over the next century, the Pittsburgh National Bank went through several mergers and acquisitions. In 1982, the bank merged with the Philadelphia-based Provident National Corporation, and the combined institution was renamed PNC Financial Corporation.
PNC continued to grow in the following years, both organically and through acquisitions. In 1992, the bank acquired the Central Trust Company of Cincinnati, which expanded its presence in Ohio. Furthermore, in 2003, PNC acquired the U.S. retail banking operations of the German-based Riggs Bank, which gave the bank a foothold in the Washington, D.C. market.
In 2008, PNC made one of its biggest acquisitions to date, when it acquired National City Corporation.
Moreover, a Cleveland-based bank with a significant presence in the Midwest. Furthermore, the acquisition made PNC the fifth-largest bank in the United States by assets.
In the years since the National City acquisition, PNC has continued to expand its services and footprint. The bank has focused on digital banking and technology, launching several innovative products and services to serve its customers’ evolving needs.
In conclusion, today, PNC Bank operates in 21 states and the District of Columbia, and offers a wide range of banking, investment, and wealth management services to individuals, businesses, and institutions. Lastly, the bank earned a reputation for its customer service, innovative solutions, and commitment to social responsibility.
