PNC Financial Average Deposits Fall 3% In Q4, Guides For Weaker FY24

PNC Financial Services Group Inc PNC shares are trading lower after it reported fourth quarter FY23 results.

The bank reported a revenue decline of 7% year-over-year (Y/Y) to $5.36 billion, beating the consensus of $5.29 billion. Revenue declined Y/Y due to lower net interest income and noninterest income. 

Net interest income fell 8% Y/Y to $3.40 billion, with a net interest margin declining 26 basis points to 2.66% as the benefit of higher interest-earning asset yields was more than offset by a rise in funding costs.

Noninterest income decreased 6% Y/Y to $1.96 billion, mainly on a decline in Capital markets and advisory revenue owing to lower trading revenue.

Average loans rose 1% Y/Y, and average deposits fell 3% Y/Y in Q4.

The company reported a provision for credit losses of $232 million in the quarter (vs. $408 million a year ago), reflecting the impact of portfolio activity.

Adjusted EPS of $3.16 came above the consensus of $2.94. CET1 capital ratio stood at 9.9% vs 9.8% in Q3 FY23. 

Dividend: On January 4, PNC’s board of directors declared a quarterly cash dividend per share of $1.55, payable on February 5, 2024, to shareholders of record as of January 16, 2024.

PNC returned $0.7 billion of capital to shareholders, comprising share repurchases worth $0.1 billion in Q4.

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

Price Action: PNC shares are down 2.32% at $145.47 premarket on the last check Tuesday.

Photo via Wikimedia Commons