April 16 - PNC reports Q1 2025 net income of $1.5B, $3.51 diluted EPS

PITTSBURGH — The PNC Financial Services Group, Inc. (NYSE: PNC) April 15 reported first quarter 2025 net income of $1.5 billion.

Income statement highlights compared with fourth quarter 2024:

• Total revenue of $5.5 billion decreased $115 million reflecting two fewer days in the quarter, seasonality and a slowdown in capital markets activity.

• Net interest income of $3.5 billion decreased $47 million, or 1%, driven by two fewer days in the quarter, partially offset by the benefit of lower funding costs and fixed rate asset repricing.

• Net interest margin of 2.78% increased 3 basis points.

• Fee income of $1.8 billion decreased $30 million, or 2%, due to a slowdown in capital markets activity and seasonality.

• Other noninterest income of $137 million decreased $38 million and included negative $40 million of Visa derivative adjustments primarily related to litigation escrow funding.

• Noninterest expense of $3.4 billion decreased $119 million, or 3%, reflecting asset impairments recognized in the fourth quarter of $97 million as well as seasonally lower other noninterest expense and marketing.

• Provision for credit losses was $219 million in the first quarter reflecting changes in macroeconomic factors and portfolio activity.

• The effective tax rate was 18.8% for the first quarter and 14.6% for the fourth quarter. The fourth quarter included a benefit from the resolution of certain tax matters.

“PNC had a strong start to the year,” PNC Chairman and Chief Executive Officer Bill Demchak, said. “We grew customers and commercial loans, expanded our net interest margin, increased capital levels and maintained solid credit quality metrics. While market uncertainty impacted our capital markets activity, expenses remained well-controlled, resulting in another quarter of strong results. Regardless of market developments, our balance sheet is well-positioned and we continue to expect record net interest income and solid positive operating leverage in 2025.”

First quarter 2025 compared with fourth quarter 2024 or March 31, 2025 compared with December 31, 2024

• Average loans of $316.6 billion decreased $2.4 billion, or 1%, driven by lower commercial real estate loans.

Loans at March 31, 2025 of $318.9 billion increased $2.4 billion, or 1%, driven by growth in the commercial and industrial portfolio of 3%, reflecting increased utilization and new production. The growth in commercial and industrial loans was partially offset by a decline in commercial real estate and consumer loan balances.

• Credit quality performance:

Delinquencies of $1.4 billion increased $49 million, or 4%, and included higher consumer loan delinquencies, primarily related to forbearance activity associated with the California wildfires.

Total nonperforming loans of $2.3 billion were stable.

Net loan charge-offs of $205 million decreased $45 million primarily due to lower commercial real estate net loan charge-offs.

The allowance for credit losses was stable at $5.2 billion. The allowance for credit losses to total loans was 1.64% at both March 31, 2025 and December 31, 2024.

• Average investment securities of $142.2 billion declined $1.7 billion.

• Average deposits of $420.6 billion decreased $4.6 billion due to seasonally lower commercial deposits and a decline in brokered time deposits. Noninterest-bearing deposits as a percentage of total average deposits were 22%.

• Average borrowed funds of $64.5 billion decreased $2.7 billion, or 4%, driven by lower Federal Home Loan Bank advances.

• PNC maintained a strong capital and liquidity position:

On April 3, 2025, the PNC board of directors declared a quarterly cash dividend on common stock of $1.60 per share to be paid on May 5, 2025, to shareholders of record at the close of business April 16, 2025.

PNC returned $0.8 billion of capital to shareholders, reflecting $0.6 billion of dividends on common shares and $0.2 billion of common share repurchases.

The Basel III common equity Tier 1 capital ratio was an estimated 10.6% at March 31, 2025, and was 10.5% at Dec. 31, 2024.

PNC’s average LCR for the three months ended March 31, 2025, was 108%, exceeding the regulatory minimum requirement throughout the quarter.