PNC Bank saw a declining trend in non-performing assets in the medium term and reported declining NPA for 12 continuous quarters.
PNC’s net interest expenses stood at ~$9.5 billion at the end of 2014, $193 million lower than 2013 after curtailing salary and miscellaneous expenses.
PNC’s NII fell due to acquisitions made in 2009 and 2012. This led to a fall in non-interest income from the peak of 50% in 2007 to its low of 38% in 2012.
PNC Bank’s net interest margin has continued to fall in the last few years, with average earning assets standing at nearly $290 billion at the end of 2014.
Liabilities such as securities, deposits, and instruments fund a bank’s assets, making liability analysis of a bank as important as those of assets.
With the seventh largest deposit base in the US, PNC Bank had a deposit base of ~$239.5 billion at the end of 2014. Of this, 96.26% originated in the US.
PNC Bank’s loan book is skewed toward a few types of loans: commercial and industrial loans and 1–4 Family First Liens, about 44.5% of its total loans.
An increasing interest rate spread between long-term and short-term rates allow banks to pay less on short-term deposits and earn more on long-term loans.
With total assets of nearly $335 billion, almost three-quarters of PNC Bank’s total assets are productive assets, particularly loans and leases.
With a strong presence in the East, South, and Midwest, PNC Bank offers community banking, wholesale banking, corporate banking, and asset management.
Wells Fargo in 2015 is expected to remain among the best performing banks.
Wells Fargo’s payout ratios improved in 2014. Dividend payout ratio rose 34% in 4Q14 compared to 29% in 4Q13 due to the bank’s strong capital position.
Wells Fargo’s Tier 1 capital declined in 2014, but it’s not an indicator of weakness. The bank had capital far in excess of regulatory requirements.
Wells Fargo’s nonperforming assets were $15.5 billion for 4Q14, a fall of $739 million from 3Q14. The drop was in nonaccrual loans and foreclosed assets.
Wells Fargo’s wealth, brokerage, and retirement segment reported net income of $514 million in 4Q14. This was an increase of nearly 5% compared to 4Q13.
Net income from Wells Fargo’s wholesale banking vertical was $1,970 million in 4Q14, a drop of nearly 7% compared to 4Q13.
Wells Fargo reported good numbers in its community banking vertical. Net interest income and noninterest income both increased 5% compared to 4Q13.
Wells Fargo’s noninterest expenses were $2,804 million in 4Q14, a 4.5% increase from 4Q13, largely due to increased commission and incentive compensation.
Wells Fargo’s noninterest income was $10,263 million in 4Q14. This was an increase of nearly 4% compared to 4Q13.
Wells Fargo reported impressive growth in net interest income in 4Q14. Net interest income was $11.42 billion, an increase of nearly 3.6% compared to 4Q13.