The PNC Financial Services Group (PNC) Barclays 22nd Annual Global Financial Services Conference summary

Economic outlook and interest rates

• Base case remains a soft landing with job growth slowing to 100,000 per month by mid-next year and the Fed expected to cut rates three times this year and five times next year.

• Neutral stance on floating rate assets and liabilities, with little sensitivity to front-end rate changes; long-term rate environment and yield curve steepness are more impactful.

• Banking sector expected to perform better in a 4%-5% 10-year rate environment in 2026-2028.

Net interest income (NII) and margin outlook

• NII and NIM inflected in Q2; guidance for Q3 is up 1%-2%, with full-year NII expected to be down 4%.

• Record NII anticipated in 2025, supported by actions such as timely securities restructuring and locking in forward rates.

• Loan growth is not relied upon for hitting targets; client acquisition and production are strong, but utilization and payoffs keep balances flat.

Deposits and funding

• Deposit stabilization continued into Q2, with a small shift into interest-bearing accounts and minimal need to chase high-cost deposits.

• Interest-bearing deposit costs have risen slightly, but overall deposit pricing is stable; competitive market may prevent consumer deposit rates from falling in line with Fed cuts.

• Indifference to front-end rate changes due to floating rate liabilities and asset repricing.