The PNC Financial Services Group (PNC) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $1.5 billion, or $3.39 per diluted share, up 10% sequentially, with results including a Visa share gain largely offset by securities repositioning and other significant items.

• Net interest income and net interest margin both grew sequentially, with NIM up 3 bps to 2.60%, marking an inflection point after six quarters of decline.

• Customer acquisition and business momentum remain strong, with accelerated DDA growth and new credit card launches in retail banking.

• Expenses were well controlled, generating positive operating leverage and a 13% increase in PPNR; the Continuous Improvement Program (CIP) target was raised to $450 million for 2024.

• Capital levels strengthened, CET1 ratio increased to 10.2%, and the quarterly dividend was raised by $0.05 to $1.60 per share.

Financial highlights

• Total revenue was $5.4 billion, up 5% sequentially, driven by higher NII and noninterest income.

• Net interest income grew 1% sequentially to $3.3 billion; NIM increased 3 bps to 2.60%.

• Noninterest income rose 12% sequentially, including a $754 million Visa gain, partially offset by a $497 million securities loss and a $116 million Visa derivative adjustment.

• Noninterest expense was $3.4 billion, up 1% sequentially, including a $120 million foundation contribution.

• Tangible book value per share increased 4% sequentially and 15% year-over-year to $89.12.

Outlook and guidance

• Q3 2024: Average loans expected stable; NII and fee income up 1–2%; core noninterest expense up 3–4%; net charge-offs $250M–$300M.

• Full year 2024: Average loans down less than 1% year-over-year; NII down ~4%; noninterest income up 3–7%; total revenue down 1–2%; core noninterest expense down ~1%.

• Effective tax rate expected at ~18.5%.