1. PNC Financial Services Group Covering Analyst: Matthew Miller Email: Miller24@uoregon.edu

2. Business Overview ›Founded in 1852 as The Pittsburgh Savings and Trust Company ›One of the largest diversified providers of financial services in the U.S. ›Strong loan and customer growth in 2012

3. PNC is Growing

4. Improving Credit Metrics

5. Scope ›2,881 Branches ›7,282 ATM Machines ›18 States, Washington D.C.

6. Geographic Scope of Operations

7. Revenue Breakdown

9. Financial Services Industry ›Consolidating ›Changing regulatory environment ›Sustained low interest rates ›Projected 5.2% growth 2012-2017

10. Consolidation

11. Regulatory Environment ›Basel III –Draft regulation published ›Implementation –Began 1 January 2013 –End 1 January 2019

12. Low Interest Rates ›Current prime rate is 3.25 ›Expected to remain low –Shrinking net interest margin

13. Comparable Analysis ›Growth, risk, and products and services –U.S. Bancorp 22.5% –CIBC 22.5% –J.P. Morgan 20% –Toronto Dominion Bank 20% –Wells Fargo 15%

14. Comparable Valuation

15. ›Values only the equity –No WACC –No Working Capital ›Reasons for not doing a DCF –Interest –Debt –Working Capital Excess Return Model

17. Excess Return Model Assumptions

18. Final Valuation

19. Questions?

20. Recommendation ›Based on my analysis I have found PNC to be significantly undervalued. Therefore I am recommending a buy for all portfolios

21. Appendix 1: Payout Ratio

22. Appendix 2: Dividend Yield

23. Appendix 3: Projected Dividend