PNC Financial Services (NYSE: PNC) reported Q1 EPS of $1.95, $0.24 better than the analyst estimate of $1.71. Revenue for the quarter came in at $4.5 billion versus the consensus estimate of $4.38 billion.

First quarter 2020 compared with fourth quarter 2019

• Net income was $915 million, a decrease of $466 million driven by a higher provision for credit losses.
• Total revenue of $4.5 billion declined $92 million, or 2 percent.
• Net interest income of $2.5 billion increased $23 million, or 1 percent, primarily due to lower rates on deposits and borrowings and higher loan and securities balances partially offset by lower loan and other earning asset yields and one less day in the first quarter.
  • Net interest margin increased 6 basis points to 2.84 percent.
• Noninterest income of $2.0 billion decreased $115 million, or 5 percent.
  • Fee income of $1.7 billion was stable as higher residential mortgage revenue and corporate service fees were offset by lower asset management revenue, service charges on deposits and consumer service fees.
  • Other noninterest income of $343 million declined $113 million primarily due to negative valuation adjustments of private equity investments and a fourth quarter gain on the sale of proprietary mutual funds partially offset by higher net securities gains in the first quarter.
• Noninterest expense of $2.5 billion decreased $219 million, or 8 percent, primarily due to lower incentive compensation and benefits expense, the impact of fourth quarter equipment write-offs and lower marketing expense.
  • The efficiency ratio improved to 56 percent for the first quarter from 60 percent in the fourth quarter.
• Provision for credit losses of $914 million, which was calculated under the Current Expected Credit Loss (CECL) accounting standard effective January 1, 2020, increased $693 million primarily due to the significant economic impact of COVID-19 and loan growth.
  • Provision was $506 million for the commercial portfolio and $399 million for the consumer portfolio.
• The effective tax rate declined to 13.7 percent for the first quarter compared with 15.1 percent for the fourth quarter primarily due to the benefit from resolution of certain tax matters and the impact of lower pretax earnings.

For earnings history and earnings-related data on PNC Financial Services (PNC) click here.