What's Going On With PNC Financial Shares Today?

PNC Financial Services Group Inc PNC shares are trading lower after it reported first-quarter FY24 results.

The bank reported a revenue decline of 8% Y/Y to $5.15 billion, missing the consensus of $5.19 billion. Revenue declined Y/Y due to lower net interest income and noninterest income. 

Net interest income fell 9% Y/Y to $3.26 billion, with a net interest margin declining to 2.57% from 2.84% prior year quarter.

Noninterest income decreased 7% Y/Y to $1.88 billion due to a decline in capital markets and advisory revenue, fee income, and residential and commercial mortgage businesses.

Average loans fell 2% Y/Y, and average deposits decreased 4% Y/Y in the first quarter. Adjusted EPS of $3.36 came above the consensus of $3.02.

The company reported a provision for credit losses of $155 million in the quarter (vs. $235 million a year ago), reflecting portfolio activity and improved macroeconomic factors. CET1 capital ratio stood at 10.1% vs. 9.2% in the prior year quarter. 

Dividend: On April 3, PNC’s board of directors declared a quarterly cash dividend per share of $1.55, payable on May 6, 2024, to shareholders of record as of April 15, 2024.

PNC returned $0.8 billion of capital to shareholders, comprising share repurchases over $0.1 billion in the quarter.

Bill Demchak, Chairman and CEO, said, “PNC delivered solid first quarter results generating net income of $1.3 billion which included an additional $130 million pre-tax FDIC special assessment. During the quarter, we grew customers, reduced expenses, increased spot deposits, maintained stable credit quality and continued to build upon our strong liquidity and capital positions.”

Investors can gain exposure to the stock via IShares U.S. Regional Banks ETF IAT and Invesco Exchange-Traded Fund Trust II Invesco S&P Ultra Dividend Revenue ETF RDIV.

Guidance: For FY24, PNC continues to expect revenue to be stable to down 2%, with net interest income declining 4% – 5% Y/Y.

The bank expects revenues to be stable and net interest income to be down 1% on a sequential basis in the second quarter of FY24.

Price Action: PNC shares are down 1.88% at $146.75 premarket on the last check Tuesday.

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