PNC Financial Services Group will record $390 million in expenses related to its home mortgage banking business when it discloses fourth-quarter results on Jan. 17, the bank said Wednesday.
Included in the expenses is a $70 million charge for the October-December quarter related to a government settlement of improper mortgage practices. That charge, along with other one-time expenses, will cut quarterly profit by 47 cents a share, according to a securities filing.
The other expenses relate to PNC's obligation to buy back mortgage securities sold to the government, as well as a write-down in the value of mortgages the bank holds.
PNC and nine other major U.S. banks on Monday agreed to an $8.5 billion settlement with bank regulators over allegations they wrongfully foreclosed on homeowners. The settlement with the Federal Reserve Board and the Office of the Comptroller of the Currency stems from a 2011 consent agreement with regulators. It covers as many as 3.8 million homeowners who were in foreclosure in 2009 and 2010.
In addition, the bank's securities filing said it will book $105 million in expenses related to merger integration and the redemption of securities, as well as a $130 million gain from the partial sale of PNC's stake in Visa.
PNC estimated in the filing that excluding the one-time expenses and gains, it would report fourth-quarter earnings of at least $1.57 a share, which is Wall Street's consensus estimate.
Distributed by MCT Information Services
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