Bank Industry Standards applies standard analytics & forecasts to 800+ banks, Bank Industry Standards

Steve Lander

Bank Industry Standards applies standard analytics & forecasts to 800+ banks

Bank Industry Standards

Equity Bottom-Up

PNC Financial has traditionally been driven more from its non-interest income than its banking business.&nbsp; No surprise, then, that the Fed's base case scenarios hits PNC's capital base hard, while the Fed's adverse and severe scenarios do not.Tier 1 ratio (now 11.1%) grows to 12.1% (adverse) and 15.0% (severe) in the 4Q17 forecast quarter.&nbsp; Base case, however, computes to 8.1% in 4Q17. The difference is the size of securities book that can grow in the absence of lending growth.&nbsp; PNC makes positive returns on its cost of funds, and inserts more to Securities under the more challenging scenarios.

PNC Financial has traditionally been driven more from its non-interest income than its banking business.&nbsp; No surprise, then, that the Fed's base case scenarios hits PNC's capital base hard, while the Fed's adverse and severe scenarios do not.Tier 1 ratio (now 11.1%) grows to 12.1% (adverse) and 15.0% (severe) in the 4Q17 forecast quarter.&nbsp; Base case, however, computes to 8.1% in 4Q17. The difference is the size of securities book that can grow in the absence of lending growth.&nbsp; PNC makes positive returns on its cost of funds, and inserts more to Securities under the more challenging scenarios. 

Fifth Third Ban

Stress Test applied to PNC Financial