PNC FINANCIAL SERVICES GROUP INC

Table 40: Analysis of Loan Portfolio (a) (b) (c)

(a)Amounts in table represent loans held for investment and do not include any associated ALLL.

(b)The CARES Act credit reporting rules expired in the third quarter of 2023 and, as such, delinquency status at December 31, 2023 is being reported for all loans based on the contractual terms of the loan. Amounts as of December 31, 2022 continue to be presented in accordance with the credit reporting rules under the CARES Act, which required certain loans modified due to pandemic related hardships to not be reported as past due based on the contractual terms of the loan, even when borrowers may not have made payments on their loans during the modification period.

(c)The accrued interest associated with our loan portfolio totaled $1.5 billion and $1.2 billion at December 31, 2023 and 2022, respectively. These amounts are included in Other assets on the Consolidated Balance Sheet.

(d)Past due loan amounts include government insured or guaranteed Residential real estate loans and Education loans totaling $0.3 billion and $0.1 billion at both December 31, 2023 and 2022, respectively.

(e)Consumer loans accounted for under the fair value option for which we do not expect to collect substantially all principal and interest are subject to nonaccrual accounting and classification upon meeting any of our nonaccrual policy criteria. Given that these loans are not accounted for at amortized cost, they have been excluded from the nonperforming loan population.

(f)Includes unearned income, unamortized deferred fees and costs on originated loans and premiums or discounts on purchased loans totaling $1.0 billion and $0.9 billion at December 31, 2023 and 2022, respectively.

(g)Collateral dependent loans totaled $1.4 billion and $1.3 billion at December 31, 2023 and 2022, respectively.

In the normal course of business, we originate or purchase loan products with contractual characteristics that, when concentrated, may

increase our exposure as a holder of those loan products. Possible product features that may create a concentration of credit risk would

include a high original or updated LTV ratio, terms that may expose the borrower to future increases in repayments above increases in market interest rates and interest-only loans, among others.

112 The PNC Financial Services Group, Inc. –2023 Form 10-K

We originate interest-only loans to commercial borrowers. Such credit arrangements are usually designed to match borrower cash flow expectations (e.g., working capital lines, revolvers). These products are standard in the financial services industry and product features are considered during the underwriting process to mitigate the increased risk that the interest-only feature may result in borrowers not

being able to make interest and principal payments when due. We do not believe that these product features create a concentration of

credit risk.

At December 31, 2023, we pledged $51.3 billion of commercial and other loans to the Federal Reserve Bank and $89.5 billion of residential real estate and other loans to the FHLB as collateral for the ability to borrow, if necessary. The comparable amounts at December 31, 2022 were $28.1 billion and $90.4 billion, respectively. Amounts pledged reflect the unpaid principal balances.

Nonperforming Assets

Nonperforming assets include nonperforming loans and leases, OREO and foreclosed assets. Nonperforming loans are those loans accounted for at amortized cost whose credit quality has deteriorated to the extent that full collection of contractual principal and interest is not probable. Interest income is not recognized on these loans. Loans accounted for under the fair value option are reported as performing loans; however, when nonaccrual criteria is met, interest income is not recognized on these loans. Additionally, certain government insured or guaranteed loans for which we expect to collect substantially all principal and interest are not reported as nonperforming loans and continue to accrue interest. See Note 1 Accounting Policies for additional information on our nonperforming loan and lease policies.