PNC's chief financial officer to retire
PNC Financial Services Group will undergo a second change in top leadership in the coming months with word on Friday that Richard “Rick” Johnson, the bank's chief financial officer since 2005, will retire this summer.
Johnson, 55, will be succeeded by Robert Reilly, who has been the head of the bank's asset management group since 2005, the Pittsburgh-based bank said.
His departure will come a few months after the previously announced retirement of Chief Executive James Rohr. Rohr said in mid-February that he will retire from PNC at its annual shareholders meeting April 23.
Rohr, 64, will be succeeded by William Demchak, who joined PNC in 2002 as vice chairman and CFO from JPMorgan Chase & Co. Demchak, 50, was named senior vice chairman in September 2010, and president last April.
PNC observers believe the fact that the bank tapped insiders as successors to both key posts speaks to its bench strength and continuity.
“Demchak has been there for years, and I don't see him changing direction at all,” said Frank Barkocy, managing director of Mendon Capital Advisors, a New York investment firm that owns PNC and other bank stocks. “He has been very in tune with what Rohr has been doing and is a solid, knowledgeable replacement.“
Barkocy said he expects Reilly will follow Johnson's path and “not be any different in carrying out the wishes of the board.” That would include continuing PNC's focus on growing in the Southeast, a market it entered in early 2012 with the acquisition of RBC Bank, which has 400 branches.
PNC got a vote of confidence from the Federal Reserve on Thursday when it passed the government's stress test, an evaluation of the largest 18 banks' ability to withstand another deep recession. The Fed's nod means PNC might raise its dividend after the board meets in April.
“Rick's leadership contributed to PNC's dramatic expansion over the past 10 years, and he was instrumental in guiding PNC through the worst financial crisis since the Great Depression,” said Rohr in a statement.
Reilly, 48, joined PNC Bank in 1987 and has held several management positions in investment and commercial banking, as well as at PNC Advisors.
Proxy materials filed late Thursday show most of the five highest-paid executives, including Rohr, received lower pay in 2012.
Rohr's total compensation dropped 46 percent last year, to $8.9 million from $16.6 million in 2011. His base salary of $1.2 million was unchanged, but the value of his stock awards fell by $5 million, and his pension and deferred compensation fell by $1.7 million.
Johnson's total pay fell 13 percent last year, to $3.3 million from $3.8 million. His base salary remained about $500,000, but the value of his stock awards decreased by $400,000.
Demchak's total pay fell 19 percent, to $7.5 million from $9.3 million. His base salary stayed at $750,000, but the value of his stock awards dropped by $1.5 million, and his non-equity incentive pay fell by $304,000.
Succeeding Reilly as head of PNC Asset Management Group will be Orlando Esposito, executive vice president of corporate banking. A certified public accountant, Esposito joined PNC in 1985 and has overseen the growth of the bank's corporate clients in the Northeast and Mid-Atlantic.
Thomas Olson is a staff writer for Trib Total Media. He can be reached at 412-320-7854 or email@example.com.