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PNC Financial Services (PNC)

Participants
Bryan Gill Director, IR
William Demchak Chairman, President and CEO
Robert Reilly EVP and CFO
John Pancari Evercore ISI
Ken Usdin Jefferies
Erika Najarian Bank of America
Gerard Cassidy RBC
Bill Carcache Wolfe Research
Mike Mayo Wells Fargo
Call transcript
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Operator

Good morning. My name is Frank, and I will be your conference operator today. At this time, I would like everyone - welcome everyone to the PNC Financial Services Group Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded. I will now turn the call over to the Director of Investor Relations, Mr. Gill. Bryan ahead. go please Sir,

Bryan Gill

Bill thank today's information. you conference Participating Welcome today's information as Today's and morning this Vice well Reilly, President as and cautionary and for the statements good CFO. CEO, President call Chairman, Group. contains are everyone. and PNC Rob call Executive forward-looking to presentation PNC's Well, Demchak; A Financial on this investor earnings Services about SEC reconciliations These release as as statements and of included no to XXXX non-GAAP available our other measures speak PNC XX, well website, Investor obligation all filings are update in and corporate pnc.com, materials. are materials as only our Relations. them. October undertakes materials, on of under These

over call to the turn Bill. to like I'd Now

William Demchak

Thanks, is morning Brian, well. everybody everybody. and Hope safe good and

expenses which the quarter We both positive higher many bounce amidst for our period. seen And third last which less of results. year-to-date We that You've credit quarter. in allowed noninterest in revenue uncertainty back provision leverage included consumer than quarter continued generate managed income, PNC was solid by X% and substantially on led over volumes. grew a us to delivered losses fronts, on fees operating

deposits early to more that credit it current drawn loans experience put has flip the our given outstanding net of the in customers declined demand. loan growth, the we to to rate fell environment weak commitments pandemic. deposit environment second lines commercial income challenging work. due the utilization from On side, were interest of pay-off those quarter strong And the and the while interest continue in including rates, low Despite and lower to made growth

position. significant discuss upcoming to underscores reserves. value. high us helping financial were position We're communities that continue advantage both the I challenges, of and a to taken is may and especially employees national in round next impact in we strategic that our these actions who events is we've strong clients the support provision election, capital, to feel little our of several industry there impact of the and including going the our the investments of to rise, loan confident want that to to down hardship, in more potential stress pandemic arise the which if non-performers say ongoing priorities opportunities strong digital and to shareholder Notwithstanding enhance thank our despite are importance bit that very areas our Rob detail. COVID with expansion take they other challenges a execute our forgiveness various charge-offs and challenges. loss navigate tests, the PNC While the our including customers quarter-on-quarter, all while and continue and liquidity offerings, Needless positioned PPP on investment and borrowers, well

then returns. expose look closer these for that our to generate to to questions. going quarter ability at I'm your attractive model third turn Rob a over strong to And our Diego. will During and the San teams and Denver, XXXX Boston market In Dallas Austin Nashville, we and markets. Seattle quarter opened Portland San middle corporate we opened retail Antonio, out The the results, continues to markets be it demographically Houston, recently to solution and happy take in with continue into centers we'll and expansion filled our in

Robert Reilly

Bill Thanks, morning everyone. good Great. and

net quarter per seen, As $X.XX third income $X.X common or reported billion of share. we've you've diluted

basis. is on presented balance an Our on is and sheet X, Slide average

due a prepayment at $XXX $X $XX X% billion declined On to Investment quarter-end. billion, maturities declined spot quarter. activity billion of significant billion to side total linked loans $XX primarily securities linked quarter. or on increased $X asset the billion But and basis

increase The equity $XX proceeds with Reserve of at impact and the our second balances of the quarter was in from deposit a continued to billion of result average $XX compared cash billion investment in BlackRock. sale Federal the quarter. Our growth the full

borrowings reduce funds common side the our to as X% of quarter XX% quarter our $XXX primarily billion liability the Borrowed Federal or XX, the compared position $XX September Bank. deposit of with On was balances value averaged Loan X% $XX.XX linked used Home decreased and book second tangible up $XX as billion, increase we per And were to strong share quarter. year-over-year. linked an and liquidity billion

liquidity X, remain our Slide strong. As you can capital and positions see on reserve

September was to be of our XX.X%. XX, As estimated ratio XXXX CETX

On quarters. four Reserve's rolling is in quarter through to XX% number. know accordance repurchases to that the $X.XX Federal subject fourth suspend Our fourth Board to net this has you authorized And regard for not of In of quarter of the per of income dividend dividends approved the recently common basis, as directive, XXXX. stock for exceeding fourth on amounts a Fed share. dividend the again continue the repurchases preceding quarterly share and our cash average we'll quarter, the with

to back billion remain third as are since Our Slide loss were Average all levels. $XX levels a billion are X% increased. or low deposit $XX.X decline billion base. This C&IB to utilization X the by compared new deposits cost coverage decrease the our to loan broad-based currently end $X.X except Compared the more shows quarter, utilization. declined approximately of was loans and categories the that year at rates for same a residential our our core-funded lower production balances detail. loan the of in pre-pandemic than X.XX%, with In X% across loans average ratios slightly from exceed in quarter. loan our average and liquidity period below in which regulatory loan down billion. virtually offset grew all draw-downs mortgage balances up occurred $XXX significantly segment has commercial continue paid Consumer approximately And in first ago running loans or requirements the minimum X.XX% June. X% the of reserve as quarter a billion reflected more second $XX we

Slide rate interest our our on XX deposit deposits shows linked balances balances and the bearing grew or billion in XX point quarter customers, increased of grew positions X deposits Year-over-year deposits billion primarily a Average loan was due basis consumer on liquidity and the decline also deposits X.XX%, consumer point paid basis or is X%. of government Commercial and our yield basis and the quarter. reflecting decline $XX spending. increased points the $XXX second As billion $XX lower enhanced XX%. to stimulus the

as third $X.X X% billion billion $X.X yields lower interest a the and can loan funding in million asset was balances second As day the Slide on an quarter income more than quarter X%. down lower and $XX decline you or in or to of offset quarter. costs total earning extra see Net the quarter X, linked $XXX compared benefit of million revenue up was

quarter, Our points quarter. LCR average excess held which the of balances $XX of $XXX interest Bank, XX% $XX of approximately million represented net million interest down points basis billion revenue Federal higher second compression XX increased net were billion billion, compared the or $XX linked which the increased or of to XX with margin billion linked balances to cash income of margin. X% requirements for reflecting Fee our Fed decreased impact quarter. basis in $X.X Noninterest quarter. to X.XX%, $X.X Reserve our the

by total Consumer for X% due fee higher and million valuation or by and as services declined $XXX million by a than adjustment advisory more in a higher was or adjustment investments, management Noninterest and in of losses of less a to in lower lower $XXX million compared negative valuation increased to consumer activity to million private $XX Provision $XX product decrease lower quarter. positive tax $XXX rate was $XX revenue. credit valuation markets. increased tax both average decrease rate declined billion million noninterest during included The on And increased credits provision equity our commercial revenue offset lower revenue mortgage offset expense a portfolio. sales $X.X of to Corporate $XX - X% second XX% primarily revenue largely driven was services positive or higher loan deposits of the services increased consumer was treasury million, Other charges a compared for partially fees. recapture increased with due management related our offset fees waivers. credit quarter a million Residential and servicing related by X.X%. the related equity income Asset during million markets capital magnitude. was The second revenue. $XX effective than the adjustment similar tax lower provision was expense or a our primarily X% by as a portfolio in quarter.

effective we rate tax to For quarter the fourth our be approximately XX%. expect

X. Slide to Turning

comparisons. leverage operating the quarter, the the both of year-to-date and X% third positive year-over-year in During quarter we generated

prior XXth, for nine improved ratio compared efficiency our quarter and third year in third the quarter XXXX. XX% result, XX% a the to September ended XXXX the As to of both months

current from While challenges environment the around deliberate presents management. pandemic and we expense related pressures, low our and remain disciplined revenue rates

previously our will target. program, we As year through are achieve continuous in improvement we we to reduce full we $XXX have million XXXX a cost by stated, confident goal and our

update investments. As business X, an effects portion be most by likely and regarding is significant specific the we've you of know, ongoing technology pandemic. industries to the this program as Slide impacted identified of a our funds

second excluding These billion or balances X% balances to loans. were September to of $XX.X to the outstanding declined loan primarily quarter, pay-downs. due XX Our compared as industries billion, these $XX.X PPP

an greatest downgrades on to While increase of this have to but these leisure do recreation. industries and to approximately XXth loans quarter. and should charge-offs billion continuing relatively these see balances continue. industries X% loans September industrial compared the expect economic declining stress material see $X Commercial charge-offs to low loan Nonperforming billion continuing remain with over we're still totaled or time outstanding, in $XX.X X% prior in be in we experienced category, trends the in we current at

million of the increased prior in our to category slide reserves total commercial million $X.X occur real X.XX% X.XX% at to the in or compared quarter. lower at continue of the increased Looking portfolio Nonperforming this Correspondingly, end billion the loans and commercial $XXX quarter, the lodging. to downgrades X% and in quarter. loans the third primarily from $XXX second have approximately estate our real declining retail totaled estate half on

XX. Slide to Moving

summer investor-owned or of less government those than to and risk, little accounts XX off rolled PNC. guaranteed credit credit present assistance present more XX% requesting these payment the business small seen $X.X accounts we this number in We approximately loans. of assistance. consumers, XXX,XXX billion hardship have businesses billion modifications have of At peak more and granted have which $X.X did remaining than $XX.X days billion or consumer that risk significant past loans current than the $X and were of representing to of loans reduction a billion are small very the Of due.

a made we of form As in these of business and some and more balances those balances XX% secured, $X.X XX% of billion a result, of small accounts Of assistance have had payment consumer than are last approximately their cycle. XXth. in payment as September

each also deferral posing segment C&IB the our Within combining On risk credit as we're to and selectively outstandings. PNC side, deferral approximately $XXX approximate total were September loan modifications continuing consumer grant of commercial X% individual balances commercial customers, XXth. in borrowers situation. loan of of When on based to loan on million loans

compared to quarter. XX. down second September Our $X.X decreased basis million net $XXX high $XX COVID XX. X%. Annualized $XX estate $XX The $XXX June $XX or from Commercial Nonperforming charge-offs XX billion to quarter. and by XXth driven loans delinquencies are were borrowers charge-offs declined delinquencies million, the the million, delinquencies Slide were in commercial on loans $XXX declined linked impact consumer $XX leases Net Total credit metrics loan charge-offs million, points. million. Consumer million increased loan industries. net loans charge-offs was were net at XX increase and XX% million, commercial both presented was and for primarily total or of down million real

XXXX. the that change our current credit last the see you the loan sufficiently the in As highlights quarter of our end, from have reflect allowance We year-to-date, quarter. since billion for can which for XXst, portfolio. slightly $X.X believe components of losses increased Slide to loans losses the at XX losses life reserves allowance December up credit in was X.XX%

As was losses credit total a was result loans X.XX% allowance allowance our nonperforming to loans our to XXX%. for and

quarter due macroeconomic adoption In the materially portfolio the in increased the this of third and to balances by reserves have year loan significant first CECL, primarily the of reduced driven changes outlook lower half year. during reserves by million. $XXX changes the Our

the commercial by addition, for In both pandemic. consumer and modestly impacted this economic for during a sheet posted quarter, In our results. borrowers reserves adversely outlook the but environment. by was PNC resulted we is $XXX our quarter improved total, believe increased million balance reserves offset in And challenging solid billion. well third positioned in our $X.X summary decline to this In this

the quarter fourth average single XXXX, of of the digits. For loans XXXX to expect we decline third compared to low quarter

expect net income We interest stable. to be

be fee stable. We expect income to core

other $XXX noninterest and high expectation will expect million million, income We between resulting in that total income the our down range. be to in be $XXX noninterest single-digit

noninterest We charge-offs, X%, approximately be $XXX expect quarter be net we and $XXX to regard expense expect and between up to total fourth million in levels million. to

pace to XXXX. all leverage this for that, And with your take between year to are X% taking and after the operating on deliver X% Importantly, questions. positive account, of into we're I ready Bill full and

Operator

ISI. Please [Operator first comes Instructions] from Our Evercore Pancari with proceed. question John

John Pancari

the a the your Is it loan that see it loan if loss releases? increase loan loss to assume would do reserve fair that we that reserves provision - bit to like percentage the decline? On here ACL and accordingly in you given increased not will charge-offs release still the like although you quarter, with put quarter, balance from looks charge-offs reserve, expect we continue example up in for those match to continue probably fourth

William Demchak

kind There reserve the second on variables a economic of we when into quarter is the in model. our based remember that forecast lot again, assumption answer, up put that John. the But of go

better the the we that forecast. at has a that in perhaps we on of was, time. the knew At little that gotten bit all margin, So point about losses the covered economy

And kind for We're and as provided that go up. of so, we in the effective using second we're charge-offs quarter. reserves

is we've general else that's principle But current continue equal have all that all economy for. from as doing. should down through, forecast is go what run equal, deterioration So charge-offs unless we and what our else the loans reserved and the

Robert Reilly

right. that's Yes,

John Pancari

saw we will that given when upside charge-offs Are same as build content? terms the topic, is see Is, expect expect the of the the that indicated you you do then of looking terms pressure where greatest next the get what some just more you the out? that we trajectory, of greatest migration And nonperformers saw, half like on ongoing charge-off in pressure you you loss in plays in year this first pressure.

William Demchak

any. they My as start showing the depends on own we're it COVID fiscal not of else sensitive out of there, do. a back more dependent But industries, real absolutely it the through But of to estate fiscal we all half earlier depends, next Again, to lot what put things, belief I equal, of in stimulus second in least is which consumers year. on, get probably is, they all which going number into provide probably see if is on be next the they on view up consumer the going my need half and more pressure to highly where then think year. flow stimulus, it whether

Robert Reilly

on would it that. I just John, add

mid but feels at speculation point, right. I all this think XXXX, it’s

John Pancari

more, If Bill, we a that and deals. appetite thoughts. How a potentially to a a just deal? the month, Biden bank if possibly to ask that for attractively? want in big I against just pursue different environment your could larger view given does victory move Could your more buybacks get you smaller Just more bank or deals influence the, on next way just M&A ask question could get political one

William Demchak

can and understand do all of the through of the sorts it Look, understand approved. a that making they to is the go you're there. to as economy. basically process different The not as I deal to But They a in basically its in we extent hold approved. laws. regulation it approval they assumptions gets whole bunch it written do hearings were has written it, I delay cause can can things. be to Ultimately, risk systemic to it's

the assumption So change in administration switch if even is this laws issue, they process the the same. a change that still even particular either regulatory somehow in they governors that on

less return, would as Can amount that time. that's Yes, always over aren't the them? the said that know bunch So bunch table, could I they effect. I real we them work do but a in fair say off require for do of deals a don't total we risk. of smaller a a we've of that

John Pancari

that's it, Got Thank okay, helpful. you.

Robert Reilly

There hasn't lot John, a play say, is of generally I'd things play our changed. out. out, a to to things lot thinking of and

William Demchak

Yes.

Operator

Our question next comes Ken with Please from Jefferies. Usdin proceed.

Ken Usdin

Thanks for taking the question.

can sequentially. quick are you Just flush couple help come statement on And other us And the being you still wondering nice kind down? with if to that questions NII, question, asset stable? see to be just of to stable to just parts NII guys NII parts that book of the out loan terms expecting like able what offset are of you are being Thanks. how of the is keep see expecting in earning I

William Demchak

Rob?

Robert Reilly

take good side so earning is liability morning. the there Ken, look NII hey asset when Yes at a Yes we side. and stable obviously the the

made - the think lot I on liability we've ground lot we've of a made up side. a of

more can there. commercial consumer, could And still fourth terms at some When we relatively And do there we if on quarter think I in particularly some we this seeing look see stimulus. flattish. there again, happens. still be loan balances, we is see, some all we what depends uptick of the

the factor at for the of the quarter which are terms industry and for rate other in will fourth us forgiven. PPP I be think loans the

those guidance half fourth into We that's then the our an of about guidance quarter we - half of have XXXX. half in and will forgiven, first into have other built of and in the what quarter that expectation built be our the

that's play and terms loans how total the biggest in NII of So probably drop.

William Demchak

Funding costs.

Robert Reilly

yes end got that yes, I on I it. front said the that, said

Ken Usdin

that my PPP is And on follow-up front. Rob actually

Robert Reilly

Yes.

Ken Usdin

down related wondering from the interest And it plays you that how help versus yields quarter if through was loan all that last? of actually forgiveness Thanks. I fees stable, income contribution yields point. tricky, gets X the really PPP terms in C&I and this can were the us in The understand and again, basis right?

Robert Reilly

get tricky. to would I'd does guidance be a in a in little our million fourth NII about related in for good PPP of us It say the quarter. terms number $XXX forgiveness

help will you size that So it.

William Demchak

loan I C&I straight we're X. think up But spread,

Robert Reilly

Spreads up down. are - yields

William Demchak

lower down as down roll LIBOR’s. the growing in we Still

Robert Reilly

Yes that's right.

million - PPP. So on that $XXX Ken on the about

Ken Usdin

was just the versus you in Do what XXX? the that third have quarter

Robert Reilly

very was it smaller. Yes, - much

Operator

Please Our comes Bank with of from next question Najarian Erika proceed. America.

Erika Najarian

it solidly to at its downturn And is lifts stock Fed this excess going you're book year? through next your chomping I'm of amount your restrictions for lift inorganic thinking Fed going appetite patient the wondering, narrower a by premium quarter the usually here, of is first be terms or restrictions. capital of once that tangible to firm JPMorgan, bit to given stock the than buybacks How essentially was in if versus does Another Bill, sitting quarter the on, second in buying terms at you are back of about opportunities enjoys? the

William Demchak

should in be through banks notwithstanding would is that at time. be that tough for should going The obvious you acquisitions the the looking So to assume COVID, we'll assume market, otherwise going be the in environment for environment we also patient but all you reasons. forward

only you never have buybacks. hurry works think all much So, know a capital be a going as think big sense. to other out, there's ever certain with and respect the thing, spend I makes as we in to opportunities we the of out to I there, continue thing trying for to is almost mean that lot

certain to and through but the not focus that it degree, debt expansion market a that enough in acquisition. So, opportunities on and the changes see we'll our we be

Erika Najarian

it. Got

Robert Reilly

both. do it's quite And conceivable - we

William Demchak

Yes.

Erika Najarian

got Yes it.

William Demchak

back. falling fact In

Erika Najarian

down John's the in team kicking the the been follow-up And or about and of a this just do about from that cumulative effectively as in think And building Fed the we coming as always I'm we we're you This as management question, for have current a that excesses the are terms redefined road? losses think wondering the programs lower that system the to pre-COVID. us has government ahead warning the charge-offs realization question. up were follow-up credit cycle

William Demchak

Act acceleration. into of helped, small Look, run this remembering We they've basically the business. said effectively out did we're commercial, with to survey I'm XX% think having definitely of year and out smaller going CARES this see a business be out continues they'll right, running an for PPP respondents if another and I but with if and

Robert Reilly

high. Alarming

William Demchak

an at PPP simply Yes, those or got by some about on of things and and be drawing My kind talk to And to a get we to year have incredible why sustainable operating on up through there's lot mid-back next show give. still guess level my lot a guys the percentage. is, reserves we it going is, of gotten of and either of guess - that's charge-offs half it's going as kind ramping up. into that's

Erika Najarian

you. Thank it. Got

Robert Reilly

big fiscal future And support is variable. a

William Demchak

Yes.

Operator

Cassidy Our Gerard next Please question comes from RBC. with proceed.

Gerard Cassidy

it's level, year. thoughts, you that you some weighing obviously rate deposits, their get and pointed margin heading much there clearly yield shift us interest the your out interest had money give quarter do anything to too second start kind now customers next of using like Reserve, of influx you've there on to and higher without of just Can your risk? up if a Is taking color you don't can that you peers, the billion the $XX your into can guys out give if Bill, that's deposits. Federal of at that in us net some because

William Demchak

I XX There there, basis. on spot billion think actually a

Gerard Cassidy

Okay.

William Demchak

isn't not you're the right. just just I look, credits pre-COVID on utilization levels. down our the Yes. rate running, No, side, X.X%, The economy deposit on seeing but from it, think

at particularly less looking stable. corporates it's more They're holding least necessarily abates carrying the They I So cash. of the balance are sheet less size using less And lines. going to know with investment. don't They're doing their on like remain inventory. Fed's are that

to of but even doing margin that of the of… value, the a see side, We're a enough that redeployment hard they're risk dent that the offers side something on In at the of offer in some terms on and amount things that you and size both lot good it's to lending areas lot security finance a to not define of return. specialty

Robert Reilly

Substantially faster…

William Demchak

go at lot trying to trade off. and short out points, just we that outcome, return some a a time, and could so force right for basis billion worth It's of money just - years lousy And of $XX XX of buy XX period Yes. make it's risk a

guess for long be lot of we'll a is period pretty the cash time we are industry. be a but of as going opportunistic, So, on my to best whole banking sitting will

Gerard Cassidy

that Very you the you good. write And credit. been been moving the forced over past there Obviously, is through before we to or - XXXXs is or or to at down the the what estate then downturns? aside is cycle guys has many cycle, this it similar you've all just is of that's, know have saw the real the down, commercial caused been forced to from cycles you you've between last terms has or cycle differences that in When credits it look you, what quite commercial very write-down, write-downs there unique. surprised any in to different,

William Demchak

from way you No, Most the mean it's, projects. historically all came go real I back. problems estate

were that were that buildings office never So built, occupied.

is where So you retail theory, paying struggling, nobody losses everything when if you though big have think can That's where even an Downtown right. could is come was instance is But nobody you remember up, real leased see rent, in. about from. historically This right. estate through is straight in because you the have, Boston

getting are on a already and malls decline. killed, they were So

Robert Reilly

Hotels.

William Demchak

one lack still this have basis. asset in the loan probably good. ones been cash struggling flow versus fine a Interestingly would Yes. of notwithstanding other Hotels that, of a that are downturn cash values flowed obvious. and the is still the cash to the for flow, pretty A look from normal lot are things on

I another the real heard yet estates up with again. is this So come way, industry

Operator

question Please proceed. Research. next comes [Operator Instructions] with Carcache Bill Our Wolfe from

Bill Carcache

Bill, number you to beneficial the stimulus. commercial be less in fiscal question Would Pancari's on earlier side? more response consumer is stimulus you on that whether expect said to the John depend will there

William Demchak

balances kept employed. It depends thousands and the they came if borrowers, we've about fair business people is $XXX helps some the consumers out and the build obviously and in commercial that things CARES redo The watched for smaller of allowed cash form, consumer of that down pay It's benefits talked substantially debt. from and side thousands extra a unemployment Act PPP to question. in that thousands before one and

excess - would the away, Now Small amount if business, which of access to we've if small commercial have the business you're basically decline in they DDA this forms this, affect less redid substantially that did capital, guys business people worried no look has consumers. they had. it environment. hurt is why balance seeing But, accounts had already who PPP gone about they I'm really charge-offs in know small you of commercial getting are the other their

Bill Carcache

experiencing the I impact guess there your would what thoughts work sort dependent share banks are think the difficulty. And bit of banking an question be setup content within just borrowers outside say there on by seems growing how CRE and of that's companies, it thoughts ultimate raises with estate financial your just likelihood your like among how on the mid of following cap pressure the like may case by could and if so, can But your foreclosures comments, you of view a of off who effective you loss maybe then then on Do XXXX CRE? prices? commercial real are up you think lot vaccine to on? it the result There's greater patients do in willingness there, for CMBS system? whether private to example maybe with that conduit equity a say is some higher less

William Demchak

margin, actually the various actually a credit seen where said in turnover as tranches. servicing where that fiduciary with traditional willing is off of more one. things. on a and being buyers, BP's the the we've So no, so, the BP's borrowers they have There banks always at special with by that willing the it been surprised they Having from a fund working Midland one been work in to to One, the our in a borrowers on say past probably the to CMBS asset. behalf relationship way buyer in we have in rebuying then contractual capital take seen work it writing the sidelines are effectively portfolio a that, Midland haven’t couple extent of is And we've another lot who two environments.

turnover imagine of active to properties a the carry for estate at the good my surprise, to bid is is properties There not for market other been bit probably through but a types moment, is. real all a there for I types. doesn't strip So secondary has there halls, pretty high. there pretty

Robert Reilly

the values. point, nature your to to Well loan this of and these pandemic crisis

William Demchak

Yes,

Robert Reilly

that. of Sort support

William Demchak

it how vaccine has COVID works and all The whether zero if, on above. the predictions, it when Yes. - assumptions and

just I'll that. So on pass

Robert Reilly

know that. we what know on Yes, you

Bill Carcache

potential overseeing where that's things If competitive of impacting Bill, you squeeze presence I those build thoughts capabilities, one there Yes and exclusively others last branch three the Neobank, is the their see five on to your of think next the that that in online networks of to proceeds any you own? deploying on benefit sort years? can there are environment And some of BlackRock one. you can can without Neobanks, around share direct out the your operate post-COVID sort traditional you fair. this sort chimes the environment? in How

William Demchak

giving nothing is from don't money cobalt can't have third-party the we XX guys, have by Yes, had they our to and to to a luxury. make in on wanted we there tech capability of these I'm that's trying that have. they back and produce, we wish running opportunity years don't we customers that stuff myself. that system, ago, basically any away if have have, but to nothing contain have that that office not the I written we bank grow

running And customers, me than simplification and Our they drives on very a third-party another simple they issue their accounts I that which platforms are low modern long-term find just don't insane. model much more free all and basically overdraft think is do no works. whole They're platforms. banks, and balance that

through branch our through I the real to centers delivery, that networks, service, think care that digital through going channel is networks we delivery win. customer scores includes and delivery model NPS multiple that delivery and ATM top-line through see and

Robert Reilly

Is our technology.

William Demchak

at money of a to kind it. ultimately cool, growing make is of things, they're at. And business Yes a it's and not they're are customers. of that, money without making like banking and need look But lot that you lots

Sorry rent. there's my

Bill Carcache

great. That's

Robert Reilly

question. good question, good a It's

Bill Carcache

Appreciate it. Thank you.

Operator

Mike Mayo question next proceed. Our Please comes with Wells Fargo. from

Mike Mayo

know you hand concern three income aren't the months plays way You ready have in, do securities, How see quite you about the the just situation that you low know market you in probably COVID expressing have which I Bill do go certainly bankrupt. on firms in have and come the So, fixed line been out. one ahead utilizations last means that this which to feel market?

have charge-off if wave the your or low? being that On other we who hand, rate it’s exceptionally see how second out. if knows plays W the a You

you temperature So over do today? you on outlook have or years? better you the couple just know your for selling BlackRock, what's do say, the next I seller’s even remorse of And feel what,

William Demchak

me into went of certainly we gives that relative The Mike. all a today. has Americas this, my that changed. corporate things thing crisis to defined thought downside, levered as think initial was high. We we've this one being bit comfort the on we times, None of the going So utilization a look couple which I at environment, side, the concerns Corporate down. into little levered of times notwithstanding three four

So for the no in into idea fact this, what were know vaccine. There We no of rates. went really didn't when downside There no real mortality we had COVID. be. could we was treatments

know things to the downside. define the we didn't of all how So

I I And are in think point out time. can best and you through is, So we the I losses along defined out pretty this the where through we I I grind that think that muddle think time, we've thing economy. the at plays much downside think tell is

we remorse? don't, not gotten seller’s this surprisingly, at that I've reserved I I that we we're As and have question. environment. point think for Do said,

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Robert Reilly

game lot to to Which point left of is your there that a is, the is play.

William Demchak

when give we'd BlackRock money Yes. today, it a my life, the I that some in mistake. I've if where my call made S&P Anybody we just was, was one because many probably who me mistake that thought made a and you. have sold I invest - with I'll is

Bryan Gill

questions? other Do you have any

Operator

questions There are no time. further this at

William Demchak

in right fourth thank All see you well, We'll you quarter. again everybody. the

Robert Reilly

Yes. Thank you.

Operator

conference concludes call. today's This

everyone. disconnect now line. may You great Have a your day,