PNC shares up after US payback, job cuts, bonuses

Shares of PNC Financial Services Group, were up 4% in early trading to around $68, their highest since the 2008 stock market crash, after the bank, PA's biggest, said it earned enough money in the first quarter to pay back US TARP investments. PNC's earnings here. plus: Transcript of earnings call, Q&A via Financial Times' seekingalpha.com here.

In a statement, bank boss Jim Rohr credited "exceptional expense management" and lower credit costs as the financial crisis starts to ease. Branch expenses fell as PNC closed or sold excess offices acquired with Cleveland's National City Corp. The company also prepared to sell its Philadelphia- and Wilmington-based Global Investment Services arm.

PNC's "strong" earnings don't mean the company is lending more. Earning assets continued to decline during the quarter, Sandler O'Neill + Partners analyst R. Scott Siefers told clients in a report. PNC expects "low single digit loan growth" as the economy recovers, wrote David Hendler, head of bond analyst CreditSights Inc.

Home-lending expenses plunged to $125 million from $173 million a year earlier as residential lending plunged more than two-thirds, to around $2 billion for the quarter.  PNC also cut asset management costs $13 million, to $157 million, through "disciplined expense management" including job cuts.

But pay and other expenses for PNC's corporate bankers rose to $445 million, from $430 million, "primarily due to higher compensation expense related to increased sales activity."