Leases

12 Months Ended

Dec. 31, 2024

Leases [Abstract]

Leases

LEASES

PNC enters into both lessor and lessee arrangements. For more information on lease accounting, see Note 1 Accounting Policies. For additional details on our equipment lease financing receivables, see Note 3 Loans and Related Allowance for Credit Losses.

Lessor Arrangements

PNC’s lessor arrangements primarily consist of direct financing, sales-type and operating leases for equipment. Lease agreements may include options to renew and for the lessee to purchase the leased equipment at the end of the lease term.

The following table provides details on our income from lessor arrangements:

Table 67: Lessor Income

Year ended December 31
In millions	2024		2023		2022
Sales-type and direct financing leases (a)	$	355	$	300	$	243
Operating leases (b)	26		46		63
Lease income	$	381	$	346	$	306

(a)Included in Loans interest income on the Consolidated Income Statement.

(b)Included in Lending and deposit services noninterest income on the Consolidated Income Statement.

The following table provides the components of our equipment lease financing assets:

Table 68: Sales-Type and Direct Financing Leases

In millions	December 31, 2024		December 31, 2023
Lease receivables	$	6,229	$	5,986
Unguaranteed residual asset values (a)	1,395		1,440
Unearned income	(869)		(884)
Equipment lease financing	$	6,755	$	6,542

(a)In certain cases, PNC obtains third-party residual value insurance to reduce its residual risk. The carrying value of residual assets with third-party residual value insurance for at least a portion of the asset value was $0.6 billion at both December 31, 2024 and 2023.

Operating lease assets were $0.4 billion and accumulated depreciation was $0.2 billion at both December 31, 2024 and 2023. We had no lease transactions with related parties or deferred selling profits at December 31, 2024 and 2023.

The future minimum lessor receivable arrangements at December 31, 2024 were as follows:

Table 69: Future Minimum Lessor Receivable Arrangements

In millions	Operating Leases		Sales-type and Direct Financing Leases
2025	$	30	$	1,568
2026	30		1,318
2027	25		1,268
2028	15		798
2029	12		524
2030 and thereafter	10		753
Total future minimum lease receivable arrangements	$	122	$	6,229

Lessee Arrangements

We lease retail branches, datacenters, office space, land and equipment under operating and finance leases. Our leases have remaining lease terms of 1 year to 43 years, some of which may include options to renew the leases for up to 99 years, and some of which may include options to terminate the leases prior to the end date of the lease term. Certain leases also include options to purchase the leased asset. The exercise of lease renewal, termination and purchase options is at our sole discretion.

Certain of our lease agreements include rental payments based on a percentage of revenue and others include rental payments if certain bank deposit levels are met. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Subleases to third parties were not material at December 31, 2024 and 2023.

Tables 70 and 71 provide details on our operating leases:

Table 70: Operating Lease Costs and Cash Flows

Year ended December 31
In millions	2024		2023		2022
Operating lease cost (a)	$	373	$	386	$	395
Operating cash flows	$	413	$	440	$	434

(a)Included in Occupancy, Equipment and Marketing expense on the Consolidated Income Statement.

Table 71: Operating Lease Assets and Liabilities

In millions	December 31, 2024		December 31, 2023
Operating lease assets (a)	$	1,619	$	1,745
Operating lease liabilities (b)	$	1,870	$	1,998

(a)Included in Other assets on the Consolidated Balance Sheet.

(b)Included in Accrued expenses and other liabilities on the Consolidated Balance Sheet.

Finance lease assets and liabilities, income, expense and cash flows at December 31, 2024 and 2023 were not material.

Operating lease term and discount rates of our lessee arrangements at December 31, 2024 and 2023 were as follows:

Table 72: Operating Lease Term and Discount Rates of Lessee Arrangements

	December 31, 2024		December 31, 2023
Weighted-average remaining lease term (years)	7		7
Weighted-average discount rate	2.76	%	2.49	%

The future lease payments based on maturity for our lessee liability arrangements at December 31, 2024 are as follows:

Table 73: Future Lease Payments for Operating Lease Liability Arrangements

In millions	December 31, 2024
2025	$	401
2026	367
2027	324
2028	270
2029	204
2030 and thereafter	492
Total future lease payments	$	2,058
Less: Interest	188
Present value of operating lease liability arrangements	$	1,870

Leases

LEASES

PNC enters into both lessor and lessee arrangements. For more information on lease accounting, see Note 1 Accounting Policies. For additional details on our equipment lease financing receivables, see Note 3 Loans and Related Allowance for Credit Losses.

Lessor Arrangements

PNC’s lessor arrangements primarily consist of direct financing, sales-type and operating leases for equipment. Lease agreements may include options to renew and for the lessee to purchase the leased equipment at the end of the lease term.

The following table provides details on our income from lessor arrangements:

Table 67: Lessor Income

Year ended December 31
In millions	2024		2023		2022
Sales-type and direct financing leases (a)	$	355	$	300	$	243
Operating leases (b)	26		46		63
Lease income	$	381	$	346	$	306

(a)Included in Loans interest income on the Consolidated Income Statement.

(b)Included in Lending and deposit services noninterest income on the Consolidated Income Statement.

The following table provides the components of our equipment lease financing assets:

Table 68: Sales-Type and Direct Financing Leases

In millions	December 31, 2024		December 31, 2023
Lease receivables	$	6,229	$	5,986
Unguaranteed residual asset values (a)	1,395		1,440
Unearned income	(869)		(884)
Equipment lease financing	$	6,755	$	6,542

(a)In certain cases, PNC obtains third-party residual value insurance to reduce its residual risk. The carrying value of residual assets with third-party residual value insurance for at least a portion of the asset value was $0.6 billion at both December 31, 2024 and 2023.

Operating lease assets were $0.4 billion and accumulated depreciation was $0.2 billion at both December 31, 2024 and 2023. We had no lease transactions with related parties or deferred selling profits at December 31, 2024 and 2023.

The future minimum lessor receivable arrangements at December 31, 2024 were as follows:

Table 69: Future Minimum Lessor Receivable Arrangements

In millions	Operating Leases		Sales-type and Direct Financing Leases
2025	$	30	$	1,568
2026	30		1,318
2027	25		1,268
2028	15		798
2029	12		524
2030 and thereafter	10		753
Total future minimum lease receivable arrangements	$	122	$	6,229

Lessee Arrangements

We lease retail branches, datacenters, office space, land and equipment under operating and finance leases. Our leases have remaining lease terms of 1 year to 43 years, some of which may include options to renew the leases for up to 99 years, and some of which may include options to terminate the leases prior to the end date of the lease term. Certain leases also include options to purchase the leased asset. The exercise of lease renewal, termination and purchase options is at our sole discretion.

Certain of our lease agreements include rental payments based on a percentage of revenue and others include rental payments if certain bank deposit levels are met. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Subleases to third parties were not material at December 31, 2024 and 2023.

Tables 70 and 71 provide details on our operating leases:

Table 70: Operating Lease Costs and Cash Flows

Year ended December 31
In millions	2024		2023		2022
Operating lease cost (a)	$	373	$	386	$	395
Operating cash flows	$	413	$	440	$	434

(a)Included in Occupancy, Equipment and Marketing expense on the Consolidated Income Statement.

Table 71: Operating Lease Assets and Liabilities

In millions	December 31, 2024		December 31, 2023
Operating lease assets (a)	$	1,619	$	1,745
Operating lease liabilities (b)	$	1,870	$	1,998

(a)Included in Other assets on the Consolidated Balance Sheet.

(b)Included in Accrued expenses and other liabilities on the Consolidated Balance Sheet.

Finance lease assets and liabilities, income, expense and cash flows at December 31, 2024 and 2023 were not material.

Operating lease term and discount rates of our lessee arrangements at December 31, 2024 and 2023 were as follows:

Table 72: Operating Lease Term and Discount Rates of Lessee Arrangements

	December 31, 2024		December 31, 2023
Weighted-average remaining lease term (years)	7		7
Weighted-average discount rate	2.76	%	2.49	%

The future lease payments based on maturity for our lessee liability arrangements at December 31, 2024 are as follows:

Table 73: Future Lease Payments for Operating Lease Liability Arrangements

In millions	December 31, 2024
2025	$	401
2026	367
2027	324
2028	270
2029	204
2030 and thereafter	492
Total future lease payments	$	2,058
Less: Interest	188
Present value of operating lease liability arrangements	$	1,870