PNC Financial Services (PNC)

PNC Share of BlackRock Earnings. PNC will continue to account for its holdings of BlackRock equity under the equity method of accounting, with its share of BlackRock’s earnings reduced from 33% to 32%, solely as a result of the exchange of 2,940,866 of its shares of BlackRock Common Stock for the new BlackRock Series C Preferred Stock being used to satisfy the LTIP obligation. The new Series C Preferred Stock will not be taken into consideration in determining PNC’s share of BlackRock earnings under the equity method.

PNC Ownership of BlackRock Common Stock. PNC’s percentage ownership of BlackRock Common Stock is expected to increase from 36.5% to 47%. This increase will result from a substantial exchange of Merrill Lynch’s BlackRock Common Stock for BlackRock preferred stock. As a result of the BlackRock preferred stock currently held by Merrill Lynch and the new BlackRock preferred stock being issued to Merrill Lynch and PNC under the Exchange Agreements, PNC’s share of BlackRock Common Stock has been, and will continue to be, higher than its overall share of BlackRock’s equity and earnings. PNC will continue to be subject to the voting agreement set forth in its current Implementation and Stockholder Agreement with BlackRock, which will be unchanged by the amendment and restatement of that agreement. Under this agreement, PNC is generally obligated to vote all of its shares in accordance with the recommendation of BlackRock’s board of directors.

PNC Net Income – Reduction in Volatility. Changes in BlackRock’s Common Stock price currently impact PNC’s net income directly, as PNC must mark-to-market its obligation to deliver shares of BlackRock Common Stock to provide a portion of the funding for BlackRock’s LTIP. PNC’s obligation to deliver these shares will be replaced with an obligation

to deliver shares of BlackRock’s new Series C preferred stock. PNC will elect to mark-to-market its holdings of the Series C shares as permitted under Statement of Financial Accounting Standards No. 159, which will offset the impact of marking-to-market the liability to deliver these shares to BlackRock.

Dividends Unaffected. The transactions contemplated by the Exchange Agreements will not affect PNC’s share of BlackRock’s dividends. The current dividend paid on the BlackRock Common Stock will be equal to the dividends paid on the preferred stock series described below.