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June 8, 2012
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One-On-One: Chuck Denny

PNC Regional President Chuck Denny discusses Kentucky’s diverse economy and incredible logistics

By Ed Lane

Charles P. Denny is regional president of Kentucky/Tennessee banking of PNC Bank, located in Louisville.

Charles P. Denny is regional president of Kentucky/Tennessee banking of PNC Bank, located in Louisville. A Kentucky native, Denny joined National City Corp. in 1988 with the acquisition of First Kentucky National Corp. and became part of PNC when the company acquired National City in 2008. Prior to his current responsibilities, Denny served in a variety of account management and leadership responsibilities, serving as head of corporate banking in Kentucky, chief credit officer, and market president for Kentucky/Tennessee banking for National City Bank. He is actively involved in the Louisville community, serving on numerous boards of directors, including the University of Louisville Foundation, the Greater Louisville Inc. Metro Louisville Chamber of Commerce, Baptist Hospital Louisville, Boy Scouts of America, the National Center for Family Literacy, the Kentucky Chamber of Commerce and Business Leaders for Education. Denny earned both his bachelor’s and master’s degrees from the University of Louisville.

Ed Lane: PNC Financial Services acquired National City Bank on Oct. 24, 2008. The deal was approved by the stockholders of both banks on Dec. 23, 2008, and was finalized on Dec. 31, 2008. The conversion of National City to PNC was completed in June 2010. How seamless was the conversion from National City Bank to PNC in Kentucky from your viewpoint as a former National City employee and the regional president of the Kentucky/Tennessee market for PNC?

Chuck Denny: The PNC merger was seamless and also transparent to our clients and our markets, and caused little disruption at all to our customers. Our merger goals were clearly laid out. We gave ourselves enough time to execute all the goals; and we constantly measured where we were in relation to the milestones that we’d established. The bank’s teammates and colleagues put in a lot of work to make the merger a very seamless integration and conversion to form the new PNC. Most rewarding were the comments from our clients about how seamless the merger was for them.

EL: How did the merger impact the number of branches and employees?

CD: In Kentucky, National City has two regional presidents, one in Lexington (John L. Gohman) and one in Louisville. Regional presidents tend to focus on geographical markets rather than state-to-state boundaries and to align clients and markets with teams of people. That’s what both banks (PNC and National City) have done historically. The markets I’m responsible for are Frankfort, Ky., west in the state of Kentucky; Seymour, Ind., south in Indiana; and the state of Tennessee. There are 35 markets within PNC.

PNC consolidated operations with National City where branches were in the same parking lot or on the same street. Post-merger PNC, we’ve increased the number of men and women and the markets they were serving. There are fewer offices today than when there were two separate banks, but in terms of PNC, we now have more offices serving this market than PNC previously did. Our customers now have more offices to choose from and the level of customer service is actually greater for our clients than it was before.

EL: What has been the initial impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act on PNC’s banking operations in your region?

CD: Certainly, the Dodd-Frank Act and the whole concept of increased regulatory reform has affected all banks and financial institutions. There’s going to be more to come as the regulations are written. PNC will be responsive to the new laws and regulations. PNC’s business strategy is to be responsive to its markets, communities, shareholders, employees and clients. We’re a values-based, driven company.

PNC has seven core business values that we live every day. That’s what guides us.  Its core belief is that the stronger and more focused the bank is to its business model, and the closer its relationship is with clients and their needs, the better off we’re going to be. PNC looks at every interaction as a relationship, not a transaction.

EL: Has the Dodd-Frank Act increased PNC’s operational costs?

CD: Clearly, PNC has had to hire additional teammates in every bank to respond to new regulations.  There’s a cost to comply with regulation. The best way PNC knows how to operate is to make sure we have a very strong and sound balance sheet, that we stay close to our clients, and make sure we are not taking on any undue risk in the marketplaces in which we operate. There are about 50,000-plus employees at PNC and we’re all risk officers, relationship managers, and responsible for risk in our company.

Bloomberg Global Market released its top banks in the world and PNC was listed as the second strongest bank in the U.S. There were only three U.S. banks on Bloomberg’s list in the top 20.

EL: Were you surprised when JPMorgan Chase announced a $2 billion loss and its CEO called it a terrible mistake that shouldn’t have happened?

CD: It’s not proper for me to comment on another bank’s performance and I’m certainly not informed to make such a comment. I can speak about PNC. We are very focused on our safety and soundness and it’s a core value of our company. PNC believes that risk management is expected of all of our teammates. The way we best serve our clients, our community, shareholders and employees is if we are always focused on providing great service and being conscience of maintaining our strength and soundness.

So within that framework, you probably wouldn’t be surprised that we don’t have these types of activities within PNC. We do have hedging operations; I think first quarter, the bank’s total income was around $81 million from those operations. Hedging is based upon our client’s needs. So that’s a very modest risk profile which PNC disclosed in its 10Q for the first quarter.

EL: As a long-term leader of Louisville’s business community, how would you evaluate Greater Louisville Inc.’s effectiveness in economic development and job creation?

CD: Job creation and economic effectiveness is a team sport and we all have a role in it.  GLI has had a big role and it has done a very effective job. The clarity of that organization when it was first founded it was pretty extraordinary and the merging of several economic development groups under one flag was game changing. The organization has benefited under great leadership, strong activity, and its membership. GLI is a large part of our region’s success story.

There have been many others that have played a part in that: our mayors (Jerry Abramson and Greg Fischer); the businesses in this community; the University of Louisville; our healthcare industry – Humana, Kindred, University of Louisville Medical Center; the research; UPS and logistics. The abundant natural resources Louisville has for distribution have influenced our city and region since its birth. It’s fair to say that our market is extremely coordinated and collaboration has always been a strong suit. Our citizens understand what needs to be done. Louisville is a community that likes to roll up its sleeves, tackle issues and create positive outcomes.

EL: GLI is in the process of recruiting a new CEO. How is the search committee progressing?

CD: CEO of GLI is a very desirable position and a search committee has been formed under the leadership of Jeff Bringardner, Mary Pat Regan and Kerry Stemler. They have an outstanding group of men and women on the search committee and are engaged as we speak. As a member of GLI, I’m excited about the new leadership opportunities. Being the CEO of GLI is one of the best economic development jobs in the country. We’ve got a fabulous search committee that I’m sure will recruit an exceptional leader for Louisville.

EL: Greg Fischer has been the Louisville Metro mayor for about a year and a half. What have been his biggest challenges as mayor and how well is he managing them?

CD: Greg Fischer is outstanding. I’ve known Greg for probably 20 years and I’ve always admired his leadership and integrity. He’s very direct in his communication; he gets it done and is one of the best leaders I’ve ever met. The transition from businessman entrepreneur to public service as a mayor has gone extraordinarily well for Greg and our community. We are very fortunate to have Greg Fischer as mayor.

EL: How important is the Ohio River Bridges Project to the economic vitality and future of the Greater Louisville region? The cost of the project is very expensive; is this a prudent investment in your judgment?

CD: The most critical economic development investment of our lifetime is the bridges project. Louisville was founded as a distribution center and we’ve certainly benefited from our rail, highway, air and the waters of the Ohio River. Louisville has every advantage for distribution and transportation and it’s a great resource.
Having adequate bridging of our river and modernization of our interstates that seem to meet at the river (Interstates 65, 64 and 71), is a natural progression of what Louisville has been building on over a couple of centuries. This is the latest investment that Louisville must make. The price is what we have to pay to maintain the competitive economic advantage of the region. Distribution is a part of our past and present, and will also be the future vitality of our region. It’s got to happen.

EL: How would you currently assess the U.S. and Kentucky economies? What is your outlook for the next 12 months?

CD: Statistics show the state’s economy tracks very closely to the national economy. Our nation has led the world in manufacturing and Kentucky has always played a significant part in that. As the U.S. has transitioned into lean and advanced manufacturing, so has Kentucky. Kentucky also has focused on the knowledge economy, technology and research, service-related businesses, healthcare and education for several decades.

The state has a strong automotive industrial base and incredible distribution; we still make things in Kentucky. Manufacturing and employment are picking up. Because of employment opportunities in Kentucky, domestic inmigration has been positive during the past two census periods. Not many Midwestern cities can say that. Louisville and Lexington growth statistics are especially strong in that regard.

Kentucky also is very blessed to have major research institutions and exceptional leadership in our universities that are driving research and innovation. Kentucky has always found a way to innovate and make use of its resources. Capital investment also is on the increase. As PNC surveys the market, we see our clients not only planning to make additional capital investments but they are doing so.

Homeowners lost value in their real estate when the great recession started (2009). Housing prices are coming back and Kentuckians have not experienced the severity of loss in their home values as homeowners in other U.S. cities.

Bringing jobs onshore to our market says volumes about the quality work ethic which has always characterized Kentuckians. Kentuckians take nothing for granted, work hard, innovate, and are entrepreneurial. Both Ford plants in Louisville are coming to life again, GE is creating new jobs and UPS is expanding. Automotive manufacturers, providing components for Ford, General Motors (in Bowling Green) and Toyota (in Georgetown) assembly plants, continue to expand and create new jobs. We see this all happening in front of our eyes. It’s a good time to be a Kentuckian and a banker in Kentucky.

EL: What impact – short and long term – will increasing the U.S. federal debt to over $15 trillion (an amount exceeding the 2012 U.S. gross domestic product) have on the U.S. economy?

CD: Every American is concerned about the growth of the U.S. deficit. At PNC, we look at the domestic and international economies and we have concerns. PNC is focused on helping our clients grow their businesses and our communities to become more competitive globally. We all have to do our part. Every business and every citizen has to be involved in helping to make our nation great.

My teammates in Kentucky and I are blessed to be with PNC. We are focused on making sound investments in our communities and the businesses that are creating jobs and making local economies stronger.

PNC has an education program, Grow up Great, a $350 million multiyear investment that focuses on getting our kids ready to learn before the age of six. The program is focused on science, technology, engineering and mathematics and getting children exposed to and excited about learning.

EL: Are the uncertainties relating to tax policy, monetary policy, healthcare (Obamacare), the Frank-Dodd Act and the growing U.S. deficits causing corporations and small businesses to keep their cash on the sidelines?

CD: Nobody likes uncertainty. We all become more risk adverse when uncertainty surrounds us. The more certain we can become about our future, the more confident we are in our actions. When we survey PNC clients, we see our clients are eager and making capital investments in their businesses.

About 70 percent of the companies PNC surveyed are planning to make a capital investment in their business this year. That’s up from 60 percent this time last year. Every day, businesses are taking care of their clients, innovating, reducing costs and expanding their business. Everybody goes to work and rolls their sleeves up. They give 100 percent every day. Again, it comes back to the magic of Americans. There have always been times of uncertainty and trial, and Americans have always come through.

EL: Pension fund and healthcare benefit costs for Kentucky’s state, county and city government employees are spiraling out of control. Cities and municipalities are asking the Kentucky General Assembly to act on this legislation.  How can Kentucky State Government fix broken and out-of-control retirement benefit plans?   

CD: As you look back over the economic history of our country, America has succeeded because it faces problems head on. Probably not as quickly as we’d like. Just as every generation as Americans who have had to face issues in the past, future generations will successfully figure out the right thing to do and we’ll do it.

EL: Do you have a closing comment?

CD: I’m just so proud of all my teammates at PNC. Every day, they’re working hard to build a great franchise in this market. I couldn’t be prouder of the men and women I work with.

Ed Lane (  is chief executive of Lane Consultants, Inc. and publisher of The Lane Report.

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Lane Report Cover June 2012 In This Issue
BEAM Focusing on Workforce Issues
Louisville-Lexington must increase skilled worker production

Kentucky Carmakers Hit the Gas
As market demand accelerates, Ford, Toyota and GM all make long-term commitments with new models, major reinvestments

A World Freight Crossroads
Logistics giants UPS and DHL each operate major international hubs in Kentucky — and they’re still growing

Corporate Culture Counts
Companies whose leaders encourage and support innovation gain the competitive advantage

Mazak Bounces with U.S. Rebound
Northern Kentucky machine tool maker’s order book is exploding with U.S. manufacturing revival

Kentucky’s Public Riverports
Commonwealth’s river transport resources being used to create regional economic engines

One-On-One: Chuck Denny
PNC Regional President Chuck Denny discusses Kentucky’s diverse economy and incredible logistics

27 counties on water shortage watch
Citizens urged to monitor drought situation, prepare to make adjustments to their water use


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