PNC Bank Analysis Course Project
FI564 Management of Financial Institutions
Professor Tracy Thompson
June 16, 2012
This comprehensive paper will analyze the financial standing of PNC Bank. In the first part o we will look at PNC Bank’s profile, mission statement and future direction. An analysis of PNC’s strengths and weaknesses based on PNC’s financial statements and ratios will be conducted. PNC will also be compared to the industry and to Bank of America. The Federal Reserve interest rates over the past five years will be correlated to PNC’s Net income for the same timeframe. The analysis will conclude with my forecast for PNC’s future profitability.
“PNC Financial Services traces its…show more content…
PNC emphasizes knowledge and expertise to provide peace of mind and project confidence in a skeptical environment created by the recent financial crisis. It emphasizes the long term goal to project a solid, long lasting and successful company. The image it wants to project is one of conservative growth oriented institution with the customer’s interest as a priority.
In the words of PNC’s chairman, the future direction of PNC is as follows, “For 2012, we continue to focus on three capital priorities. First, we will build capital to support our clients, increase customer relationships and invest in our businesses. Second, we must maintain appropriate capital in light of global economic uncertainty. Finally, we expect to return excess capital to shareholders as appropriate, subject to regulatory approval”.
This future look into PNC’s operations gives current and future customers a message of PNC’s self control and conservative approach to growth. As the result of the recent crisis, many banks engaged in risky investments jeopardizing the stability of the organization and creating a systemic risk. It seems from PNC’s future direction, they have learned the lesson.
Financial Ratios analysis.
The primary measure used by regulators and analysts to measure a bank’s capital strength is the Tier 1 capital ratio. Analyzing this ratio indicates the strength and the bank’s ability to