Stephanie Novosel, who leads PNC Financial Services's commercial bank, spent a lot more time talking to clients about PNC's financial footing when the banking crisis hit this spring.
The conversations were fairly easy to have, since the super-regional bank's balance sheet was far different than those at other banks who either failed or came under stress. But Novosel and her team of bankers still learned plenty from the introspection and careful studying of PNC's financials.
"We were quite proud of being able to deep dive into ourselves and looking at our own financial statements and being able to share that with clients — because we are well positioned," Novosel said.
"I found it intellectually very interesting," she added, "and I know a lot of our bankers did too."
PNC's assurances helped the $558 billion-asset bank retain clients and keep deposit outflows limited, at a time when depositors' fleeing was every bank's worst nightmare.
With the crisis now in the rearview mirror, clients' questions have returned to more standard topics. They're asking about how to deal with rising interest rates, where to invest their spare cash and how to manage their deposit balances at PNC.
Credit demand has softened somewhat as some clients are in a "wait-and-see" mode on expansions, Novosel said. But many remain optimistic about their growth potential, and few are showing signs of struggling to repay their loans, Novosel said.
"Our portfolio is performing really well," she said.
PNC bankers are laser focused on ensuring it stays that way. They're evaluating borrowers' ability to deal with lingering supply chain issues, inflation and higher interest rates. PNC has developed an early warning system to flag potential issues for borrowers, a feature that Novosel said is particularly critical for some smaller middle-market companies that don't have extensive finance teams.
"We have very experienced bankers who have been through cycles before," Novosel said, adding that the company's approach is to stick with its clients "through the cycle" whether or not they're seeking new loans.
The bank is also offering advice to clients on payment strategies and how to deal with
Succession planning is another hot topic, as companies think about transferring their business to family members, employees through stock option programs or other types of transactions.
Novosel is also spending much of her time working on upgrading commercial clients' digital experiences — offering the same types of options that have long been in place for consumers.
The early-warning system is one example of how PNC is using data and analytics to improve borrowers' experience. But in general, commercial clients want their banking experience to be more efficient, and PNC has built "a lot of products that work very well" for middle-market clients, she said.
Novosel is also ensuring her team capitalizes on PNC's 2021 acquisition of BBVA USA Bancshares, which was previously part of Spain's Banco Bilbao Vizcaya Argentaria. The deal expanded PNC's footprint in some markets like Florida, but it also brought the Pittsburgh-based bank to states where it previously did little business: Texas, California and Arizona among them.
"It got us into a lot of markets that we wanted to be in, and we picked up a lot of great talent," Novosel said.
