PNC Financial Surges Past Q3 Expectations With Revenue Boost And Strong Fee Growth

PNC Financial Services Group, Inc. (NYSE:PNC) shares are trading higher after it reported third-quarter results.

Revenue rose 4% Y/Y to $5.432 billion, beating the consensus of $5.389 billion. Revenue growth Y/Y led by higher noninterest income.

Net interest income remained flat Y/Y at $3.41 billion, with a net interest margin of 2.64%.

Noninterest income grew 11% Y/Y to $2.02 billion, led by higher fee income (+13% Y/Y) thanks to strong capital markets and advisory revenue.

Average loans and average deposits both remained stable Y/Y in the third quarter. EPS of $3.49 topped the consensus of $3.32.

The company reported a provision for credit losses of $243 million in the quarter (vs. $129 million a year ago). CET1 capital ratio stood at 10.3% vs. 9.8% in the prior year quarter.

Dividend: On October 3, 2024, PNC’s board of directors declared a quarterly cash dividend on common stock of $1.60, payable on November 5, 2024, to shareholders of record as of October 16, 2024.

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

The company expects the share repurchase activity for the fourth quarter of 2024 is expected to match recent quarterly averages.

Bill Demchak, Chairman and CEO, said, “Our results for the third quarter demonstrate PNC’s continued strong momentum across the franchise. NII and NIM both increased, fee revenue grew substantially and expenses remained well controlled, resulting in positive operating leverage.”

“Importantly, we increased TBV, grew customers and continued to strengthen our capital levels. We remain well positioned to capitalize on opportunities and achieve record NII in 2025.”

Guidance: For the fourth quarter, the bank expects average loans and total revenue to be stable and net interest income to be up 1% sequentially.

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

Price Action: PNC shares are up 0.78% at $190.00 premarket at the last check Tuesday.

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