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February 15, 2013 12:17 am
The bank announced on Thursday that Mr Demchak, 50, will succeed Jim Rohr, 64, at an annual meeting in April.
Mr Demchak, who is in his 30s, was one of a clutch of bright young bankers who developed the credit derivatives market. He has been with PNC for 10 years and was long seen as the heir apparent.
“Bill has demonstrated exceptional leadership since joining PNC in 2002,” said Mr Rohr. “His candour and work ethic have earned him the trust of employees and investors, and the confidence of PNC’s board. He deserves the opportunity to steer PNC into the future.”
Under Mr Rohr, who is staying on as executive chairman for a year, the bank expanded beyond its home in Pennsylvania to establish a presence in 19 states with a slew of acquisitions, culminating in last year’s acquisition of the US retail business of Royal Bank of Canada. The company has been helped by its shareholding in BlackRock, the world’s largest asset manager.
Mr Demchak joined the company as chief financial officer after PNC was reprimanded by federal regulators for transactions that had shifted more than $700m of assets off its balance sheet, using structures created with American International Group, the insurer.
The appointment of Mr Demchak to the role in his native Pittsburgh received the blessing of the Federal Reserve during the investigation into the accounting. He went on to take on more responsibility, staying with the company despite being linked in 2009 with the then-vacant chief executive position at Bank of America. He was named president of PNC last year.
Last month, PNC beat analysts’ expectations with a 45 per cent jump in fourth-quarter profits to $719m. “While we are pleased with the progress we have made, our financial results do not yet reflect the full potential from our investments,” Mr Rohr said at the time.
PNC is also still grappling with the fallout from the collapse in the housing market. It set aside $254m for the repurchase of soured loans from the US government’s mortgage companies Fannie Mae and Freddie Mac in the period.
That figure is more than seven times the amount it set aside a year earlier, and is the third time PNC has tweaked its provisions for loan repurchases in about six months.
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