01—Abstract
Summary
Summary of the 10-K/A filed October 23, 2003. Cited figures are marked; the original filing is the authoritative source.
This document is an index-style excerpt from PNC Financial Services Group's Form 10-K for fiscal year 2002, filed October 23, 2003 (the filing is dated later than the usual March timing, so investors should confirm the filing date and whether this is an amended or late submission).
It does not contain PNC's actual financial results. Its financial statements (income statement, balance sheet, shareholders' equity, cash flows, notes, and quarterly data) are incorporated by reference from the 2002 Annual Report to Shareholders, which is not included in this excerpt. Because the excerpt only lists those pages, no revenue, earnings, capital, or credit-quality figures can be drawn from it.
The most material content concerns auditor and governance changes. The 2002 statements were audited by Deloitte & Touche LLP, while the 2001 and earlier statements were audited by former auditor Ernst & Young LLP, whose report dated March 1, 2002 is reproduced. Consents from both firms are filed as exhibits.
The exhibit list also reflects PNC's 2002 regulatory and corporate events: a Federal Reserve Bank of Cleveland agreement, an OCC agreement, and an SEC cease-and-desist order (Exhibits 99.1 to 99.3, dated July 18, 2002), along with the Federal Reserve's December 2002 confirmation that PNC met financial holding company requirements under Gramm-Leach-Bliley. Sarbanes-Oxley Section 302 and 906 certifications from the CEO and CFO are included. The filing also documents PNC's stake in BlackRock, Inc., including the 1999 IPO agreement, the 2002 share surrender agreement, the amendment to the IPO agreement, and BlackRock's 2002 long-term incentive plan.
For investors, the key takeaways are the auditor transition, the 2002 regulatory resolutions, and the BlackRock relationship. Full financial performance requires the incorporated Annual Report exhibit (Exhibit 13), which was filed separately.
02—Key points
Key Highlights
- Auditor transition: Deloitte & Touche LLP audited the 2002 financial statements, replacing Ernst & Young LLP, whose March 1, 2002 report on 2001 results is reproduced in this filing.
- Regulatory resolution: PNC entered agreements with the Federal Reserve Bank of Cleveland and the OCC and faced an SEC cease-and-desist order (Exhibits 99.1-99.3, July 18, 2002), and the Federal Reserve confirmed in December 2002 that PNC was in full compliance with Gramm-Leach-Bliley financial holding company requirements.
- Financial statements are incorporated by reference: income, balance sheet, equity, cash flow, notes (pp. 72-107), and quarterly data are in the 2002 Annual Report, so this excerpt contains no performance figures.
- BlackRock, Inc. relationship: the filing lists the 1999 IPO agreement, 2002 share surrender agreement, IPO agreement amendment, stockholders agreement amendment, and BlackRock's 2002 long-term retention and incentive plan.
- Capital structure: multiple series of cumulative convertible preferred stock (Series A-D, $1.60 and $1.80 dividend rates) and Series G junior participating preferred stock are outstanding under incorporated terms.
- No single long-term debt instrument exceeds 10% of consolidated total assets, per Exhibit 4.1, and PNC agrees to provide debt instruments to the SEC on request.
- Governance and compensation: certifications under Sarbanes-Oxley Sections 302 and 906 are included, along with numerous executive compensation and incentive plans, including the Joseph Whiteside employment agreement.
03—Questions
Frequently Asked Questions
Why did PNC change auditors, and who audited the 2002 results?
The filing shows Deloitte & Touche LLP as the independent auditor for the 2002 financial statements, with Ernst & Young LLP as the former auditor for 2001 and prior periods. The filing does not state the reason for the change, so investors should check the 10-K's Item 9 or the related 8-K for details.
Does this filing show PNC's 2002 earnings, revenue, or capital ratios?
No. The income statement, balance sheet, cash flows, and quarterly data are incorporated by reference from the 2002 Annual Report to Shareholders (Exhibit 13), which is not reproduced in this excerpt. Investors need that exhibit for financial performance details.
What regulatory issues did PNC face in 2002?
The exhibits show agreements with the Federal Reserve Bank of Cleveland and the Office of the Comptroller of the Currency, plus a SEC order instituting administrative proceedings and imposing a cease-and-desist order, all dated July 18, 2002. On December 19, 2002, the Federal Reserve confirmed PNC was in full compliance with the financial holding company and financial subsidiary requirements under Gramm-Leach-Bliley. The filing does not describe the underlying conduct, so the full terms should be reviewed in the referenced exhibits.
How significant is PNC's relationship with BlackRock?
The exhibit list includes multiple agreements governing PNC's relationship with BlackRock, Inc., including the 1999 initial public offering agreement, a stockholders agreement, a 2002 share surrender agreement, and amendments in October 2002. These indicate a continuing structured relationship, but the filing does not quantify PNC's ownership stake or its financial impact.
04—Continue