Jim Rohr -- expects 'real housing market' within 2 years
By Patricia Sabatini Pittsburgh Post-Gazette
PNC Financial Services Group CEO James Rohr said he believes the slow recovery in the nationwide housing market will keep the economy chugging along in 2013.
"We see a slightly improving situation with moderate economic growth in the U.S." next year, Mr. Rohr said during an investor conference Tuesday in New York City.
"In the next 18 to 24 months, I would expect we'll have a real housing market -- something we haven't seen for many years."
That scenario assumes that "somehow the fiscal cliff will be managed" in Washington, European countries will "continue to muddle along" and interest rates will remain low, he said.
The fiscal cliff refers to tax hikes and spending cuts that will automatically go into effect at the end of 2012 unless Congress and the president decide to change that.
Low vacancy rates for apartments nationwide are pushing up rental prices and sparking demand for lower priced homes, Mr. Rohr said. "In some markets, they claim there's a shortage of homes," he said. "Across the country, that isn't the case, but it's improving in many, many markets."
He said Pittsburgh-based PNC will continue to cut costs next year, slashing another roughly $500 million in expenses on top of the $550 million in cost reductions slated for 2012. The super-regional bank plans to step up branch consolidations next year as one way to cut costs. PNC also "will consider repricing" some of its retail banking products, Mr. Rohr said.
PNC shuttered about 50 branches this year across its multistate footprint. In some cases, those offices were replaced by a new one or the closure resulted from an acquisition, a spokesman said.
Customer transactions at a branch can cost more than six times what it costs for customers to use an automated teller machine, Mr. Rohr said.
To help customers feel more comfortable about cashing or depositing checks at an ATM instead of using a teller, PNC has been deploying advanced machines that stamp check images on customers' receipts.
The bank expects that some 4,000 of its roughly 7,000 ATMs will have the image technology by the end of next year, Mr. Rohr said.
Separately, PNC announced Tuesday that it would suspend evictions during the holidays on occupied foreclosed homes nationwide between Dec. 17 and Jan. 2.