PNC pledges local commitment

//August 19, 2008

PNC pledges local commitment

//August 19, 2008

Another local bank disappeared recently when The PNC
Financial Services Group Inc.
hung its signs on the branches of what had been
Lancaster County-based Sterling Financial Corp.

But PNC’s commitment to small-business customers and to
local charities will not fade, said Dennis P. “Denny” Brenckle, president of
the Pittsburgh bank’s Central Pennsylvania

PNC has two units focused on business customers with
revenues up to $30 million, one for the smaller customers in that range and
another for the big ones in that range.

“And that is a sweet spot within PNC’s organizational
goals,” he said.

Banks often bleed customers during mergers. PNC retained 92
percent of Sterling Financial accounts as of June 30, spokesman Edward J.
Kozmor said. Customers are staying with PNC in part because the company has
made few changes to front-line staff from the former Sterling, Brenckle said. That includes
retaining senior executives from Sterling,
including former Chief Executive Officer Roger Moyer.

was sold in the wake of a major fraud scandal. Some shareholders have grumbled
that Sterling executives failed the company by
not catching the alleged fraud sooner, including several investors who have
filed lawsuits.

Asked what PNC would say to those people about keeping the
executives, Kozmor said, “While there could be some anxiety by shareholders,
overall Denny is the one that is overseeing this market … and with
shareholders, they want to see results.”

PNC has delivered with a seamless conversion and strong
earnings, he said.

Acquisitions can sometimes lead to a decline in charitable
giving to local organizations, but Brenckle said nonprofits need not worry.

“I think if you look at PNC’s years of being in the
communities that they serve that we are normally on the leading edge of this
stuff,” he said. “That will continue.”

PNC acquired not just Sterling’s
revenue stream, but also its expense structure, Brenckle added.

“We’re going to try to stand up to those commitments and to
the needs of the community,” he said.

To underscore that message, PNC is launching a new
initiative to support key performing-arts centers throughout Central
Pennsylvania under the tagline PNC On Stage.

Customers value that PNC is thriving in a tough climate for
banks, Brenckle said.

“We’re in a unique situation right now (in banking), and I
would bring in the equation of safety and soundness, which is something
somewhat new to the environment,” Brenckle said.

Safety and soundness is a term that generally refers to the
stability of a bank – a bigger concern after the high-profile failure of a California
bank known as IndyMac.

“What we’ve seen in the last 18 months has certainly not
been normal,” Brenckle said, referring to earnings declines at many banks.

PNC was forced to make over its business after getting into
hot water with regulators this decade, said Richard Bove, a bank analyst with
the financial firm Ladenburg Thalman in

“PNC is a very much different company than it was at the
beginning of this decade. It is better than the average bank out there,” he

PNC also steered clear of the mortgage messes that have
preoccupied Wall Street since 2007, he said. But Bove said that was true of the
vast majority of banks, whose stock prices he said are being dragged down by an
overreaction in the stock markets.

may be gone, but it will not fade into oblivion. PNC will remember the old
bank’s rich history through a research effort called PNC Legacy, including
museum-style displays, officials said.

The conversion is personally significant for Brenckle, who
in 1986 took over as president of a small Central Pennsylvania
bank PNC had acquired. Twenty years later, PNC is one of the biggest banks in
the region.

“Isn’t it great to be in America? And part of PNC,
incidentally,” Brenckle said.