PNC FINANCIAL SERVICES GROUP INC

Retail Banking

Retail Banking’s core strategy is to build lifelong, primary relationships by creating a sense of financial well-being and ease for our clients. Over time, we seek to deepen those relationships by meeting the broad range of our clients’ financial needs across savings, liquidity, lending, payments, investment and retirement solutions. We work to deliver these solutions in the most seamless and efficient way possible, meeting our customers where they are - whether in a branch, through digital channels, at an ATM or through our phone-based customer contact centers - while continuously optimizing the cost to sell and service. We believe that, over time, we can grow our customer base, enhance the breadth and depth of our client relationships and improve our efficiency through differentiated products and leading digital channels.

Table 12: Retail Banking Table

12 The PNC Financial Services Group, Inc. –Form 10-Q

(c)Represents mortgage loan servicing balances for third parties and the related income.

(d)As of March 31.

(e)Servicing fees net of impact of decrease in MSR value due to passage of time, which includes the impact from regularly scheduled loan principal payments, prepayments and loans paid off during the period.

(f)Reflects all branches excluding standalone mortgage offices and satellite offices (e.g., drive-ups, electronic branches and retirement centers) that provide limited products and/or services.

(g)Includes cash and money market balances.

Retail Banking earnings for the first three months of 2025 increased $27 million compared to the same period in 2024 as a result of higher net interest income, offset by higher noninterest expense, lower noninterest income and higher provision for credit losses.

Net interest income increased in the comparison primarily due to wider interest rate spreads on the value of deposits, partially offset by declines in average deposit and loan balances.

Noninterest income decreased in the comparison due to lower residential mortgage revenue and higher negative Visa derivative adjustments primarily related to litigation escrow funding.

Provision for credit losses for the first three months of 2025 was driven by net charge-offs and changes in the ACL due to macroeconomic factors and portfolio activity.

Noninterest expense increased in the comparison due to technology investments, higher marketing spend and increased customer activity.

Retail Banking average total loans decreased in the first three months of 2025 compared to the same period in 2024. Average consumer loans decreased driven by lower residential real estate, as a result of paydowns outpacing new volume, lower credit card loan balances, and continued declines in education loans from runoff in the government guaranteed portfolio. Average commercial loans increased due to higher loan commitment utilization, primarily within the automobile dealer segment.

Our focus on growing primary customer relationships is at the core of our deposit strategy in Retail, which is based on attracting and retaining stable, low-cost deposits as a key funding source for PNC. We have taken a disciplined approach to pricing, focused on retaining relationship-based balances and executing on targeted deposit growth and retention strategies aimed at more rate-sensitive customers. Our goal with regard to deposits is to optimize balances, economics and long-term customer growth. In the first three months of 2025, average total deposits decreased compared to the same period in 2024, and included lower brokered time deposits.

Retail Banking continues to enhance the customer experience with refinements to product and service offerings that drive value for consumers and small businesses. As part of our strategic focus on growing customers and meeting their financial needs, we operate and continue to optimize a coast-to-coast network of retail branches, solution centers and ATMs, which are complemented by PNC’s suite of digital capabilities. In 2024, PNC announced it would be investing approximately $1.5 billion, over the next five years, to open more than 200 new branches in key locations, including Atlanta, Austin, Charlotte, Dallas, Denver, Houston, Miami, Orlando, Phoenix, Raleigh, San Antonio, and Tampa, while completing renovations of 1,400 existing locations across the country during the same time period to enhance the customer experience.

The PNC Financial Services Group, Inc. –Form 10-Q 13