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PNC Returned Capital through Stock Repurchases and Dividend

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Apr. 17 2015, Published 12:02 p.m. ET

Strong capital position

PNC Financial’s (PNC) transitional and pro forma fully-phased Basel III common equity Tier 1 capital ratios were an estimated 10.4% and 9.9%, respectively, as of March 31, 2015. The strong Tier 1 capital ratio was supported by modest improvement in the credit quality. PNC Financial’s non-performing assets declined 4% to $2.8 billion and net charge-offs decreased to $103 million—compared to $118 million in the previous quarter. The strong capital, liquidity, and asset quality helped the total assets grow to $351 billion as of March 31, 2015.

PNC Finacial has comparable dividend payouts and a Tier 1 capital ratio with the likes of JPMorgan Chase (JPM), Bank of America (BAC), Citigroup (C), Bank of Montreal (BMO), BB&T Corporation (BBT), US Bancorp (USB), and Wells Fargo (WFC). They form 31.92% of the Financial Select Sector SPDR (XLF).

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Returning of capital

PNC Financial continued its stock repurchase program in order to share the capital with the shareholders. In 1Q15, the bank bought back 4.4 million common shares worth $0.4 billion. The purchase was part of its four-quarter repurchase program that started in April 2014. The bank bought a total of 17.3 million common shares for $1.5 billion. PNC Financial announced another five-quarter repurchase program of up to $2.875 billion beginning in 2Q15. PNC Financial also raised its quarterly dividend by $0.03 per share—effective with the May dividend.

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