PNC Financial Services Group Inc.'s fourth-quarter profit slid 42% as the lender struggled with a decline in revenue and steep one-time charges, although credit costs continued to fall.
Like its fellow lenders, PNC has been able to steadily reduce funds set aside to cover potentially risky loans as credit conditions in the U.S. continue to strengthen.
For the fourth quarter, PNC reported its credit-loss provisions totaled $190 million, down from $442 million a year ago and $261 million in the third quarter.
PNC, one of the largest lenders in commercial real-estate, reported its average loans at $71 billion for the fourth quarter, up from $63 billion a year earlier and $68 billion in the third quarter.
PNC reported a profit of $476 million, down sharply from a year-earlier profit of $823 million. Per-share earnings, which reflects the payment of preferred dividends, fell to 85 cents from $1.50 a year ago. The latest period included a 30-cent per-share impact from residential mortgage foreclosure-related expenses and a 24-cent per-share impact related to redemption of trust preferred securities.
Total revenue declined 9.1% to $3.55 billion as noninterest income fell 21% from a year earlier. Analysts polled by Thomson Reuters expected earnings of $1.41 a share on $3.54 billion in total revenue.
Net charge-offs, or loans lenders don't expect to collect, were 0.83% compared with 2.09% last year and 0.95% in the prior quarter.