A screen displaying the PNC Financial Services Group logo and trading information on the floor of the New York Stock Exchange (NYSE) on April 19, 2023 in New York City, USA.Reuters/Brendan McDiarmid/File photo Obtaining license rights
Oct 13 (Reuters) – PNC Financial Services Group (PNC.N) said on Friday the U.S. lender’s third-quarter profit fell and revenue fell short of expectations. As part of this, the company announced that it will reduce its workforce by approximately 4%.
The company announced that the workforce reductions will reduce annual labor costs by approximately $325 million, or 5%.
Shares of the Pittsburgh-based bank rose 1.1% in premarket trading after the company said it expects layoffs to be mostly complete by the end of the fourth quarter.
Large banks, as well as several regional banks, have cut jobs in recent months to better position themselves in a turbulent economy.
Big banks such as Goldman Sachs (GS.N) and Morgan Stanley (MS.N) have already announced a flurry of job cuts this year as part of cost-cutting efforts.
PNC’s revenue for the three months ended Sept. 30 fell 5.7% to $5.23 billion, below analysts’ average estimate of $5.32 billion.
PNC’s average deposits decreased 3.8% to $422.5 billion from $439.2 billion in the same period last year.
The lender posted a profit of $1.57 billion, or $3.60 per share, compared with $1.64 billion, or $3.78 per share, in the year-ago period. Analysts had expected earnings of $3.11 per share, according to LSEG IBES data.
PNC said net interest income (NII), the difference between banks’ income from loans and deposit payments, could fall by 1-2% from the previous quarter in the fourth quarter.
NII in the third quarter decreased by 1.6% compared to the same period last year.
Some financial institutions have warned that NII growth is slowing as borrowing costs rise and customers are discouraged from applying for loans, especially as central banks keep interest rates high for an extended period of time. .
PNC set aside $129 million in credit loss reserves (versus $241 million last year).
The company’s banking division announced earlier this month that it had purchased a portfolio of capital commitments from Signature Bridge Bank for $16.6 billion in an arrangement with the Federal Deposit Insurance Corporation.
Reported by Jaiveer Shekhawat and Pritam Biswas in Bengaluru. Edited by: Pooja Desai, Sriraj Kalluvila, Vinay Dwivedi
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