PNC Financial 2Q17 Earnings Call Notes

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Bill Demchak – Chairman, President and Chief Executive Officer

Consumer side should be more influenced by rates than shrinking of balance sheet

“we will see when the Fed makes the decision to reduce its balance sheet and they have announced that they will do that somewhat gradually and through time that will drive liquidity out of the market. We will see the biggest impact of that in my view coming out of the corporate side first, which has the highest beta therefore it has the least impact on us. I think the consumer side is going to be driven frankly by continued increases in short-term rates by the Fed as opposed to the necessary shrinking of their balance sheet, which is going to occur over the course of years, the way they have scheduled it out.”

Probably a couple of moves away before you start seeing deposit shift

“On the consumer side. There is obviously a small, but growing online presence of deposit gatherers who are paying well above what traditional bank pays, but it’s a tiny percentage of total consumer deposits. I think we are a couple of moves away from the Fed before you start really seeing the positive beta shift on the consumer side.”