PNC Financial Services Group Inc(NYSE: PNC) stock lost over 0.5% today (as of 11:42AM EST on Jan 12th, 2018; Source: Google finance) on concerns of rising costs. Moreover, the Net interest margin fell to 2.88 percent against 2.91 percent in the third quarter hurt by tax legislation related to leveraged leases hurting the margin by 3 basis points. The group’s strategic priorities throughout the year, including technology initiatives and the expansion of their middle market franchise into new markets.
The group reported a total revenue rise of 3% to $4.3 billion while the Net interest income was $2.3 billion which was stable during the third quarter. Net interest income enhanced $26 million, or 1 percent, on the back of better loan balances and higher loan and securities yields without the impact of tax legislation.
Noninterest income surged $135 million, or 8 percent to $1.9 billion, boosted by solid fee income and a net benefit from major items. Provision for credit losses fell to $125 million, on the back of rising provision for the consumer loan portfolio which was more than offset by a lower provision for the commercial lending portfolio. But Nonperforming assets fell $32 million as of Dec 2017 against September 30, 2017 on the back of the decrease in other real estate owned and foreclosed and other assets as well as lower nonperforming residential real estate loans. This pressure was offset by rising nonperforming commercial loans primarily in the retail/wholesale trade category largely attributable to a single borrower. Nonperforming assets to total assets were .53 percent as at December 31, 2017 against .55 percent at September 30, 2017 and .65 percent at December 31, 2016.
Investment securities balance enhanced $1.1 billion as at December 31, 2017 while Average balances for the fourth quarter lost $.2 billion against the third quarter on the back of the portfolio runoff and timing of reinvestments.