PNC 2024 Outlook: Large Corporates

For many businesses, 2023 turned out to be the year of “wait and see.” Ongoing economic uncertainty around the interest rate environment and possibility of an impending recession, compounded with concerns about geopolitical tensions and the upcoming election year in the U.S., left many businesses in pause mode in terms of taking action on strategic priorities, unsure of what their next moves should be and when they should make them.

While waiting for clarity around what might be on the horizon, many companies have been focusing on managing revenues and efficiency, making sure their credit profile is in order, and other aspects of their strategy they’re able to control. This is a sound approach to running a business responsibly, but it may present obstacles to growth, according to Terry Begley, head of Corporate Banking at PNC Bank.“ Companies may find if they wait too long for clear answers, they may miss out on some opportunities going into 2024,” said Begley. “For businesses that have growth aspirations, it may be time to think about breaking out of a holding pattern so that they’re ready when green shoots appear.”

Achieving this may require developing a certain comfort level operating with some level of ongoing uncertainty. “There’s no way to know exactly what the economy is going to look like as we move into 2024. Instead of waiting to see how things play out, businesses should think about committing to their long-term business plan and goals, whether that’s an acquisition or achieving growth through other means.” Begley said. “They can put strategies around economic and rate environment assumptions that can be changed over time, which can help them hedge some of the near-term challenges while still working to achieve their long-term strategy.”

For businesses interested in pursuing acquisitions, taking action while still operating in the current environment may mean exploring updated valuations and examining capital structure and financing capacity which may be different than in the recent past. Also, many companies are currently financed with short-term maturities at low rates, but each year brings them closer to maturity dates on the debt, bringing refinancing considerations to the forefront. Implementing hedging strategies to manage interest rate risk continues to be important as the direction interest rates will take in the coming months and years remains uncertain.

For these and other challenges, solid banking relationships can provide important guidance. “At PNC, we don’t have a crystal ball to know how the exact economic environment is going to look throughout 2024 or beyond,” Begley said. “However, we can work closely with businesses to advise and develop strategies for setting themselves up for success, both now and when the economic outlook eventually improves.”

Begley noted that not every pressing business need is rooted in the current macroeconomic uncertainty. “There are some issues businesses are thinking about that don’t necessarily correlate directly with current economic pressures, with business succession planning as a prominent example. There are a lot of business owners right now who are looking to exit their companies, and they may have very particular objectives in mind, including timing, strategies for transferring ownership, tax and estate planning, and so on,” Begley said. “They want to move forward on this regardless of what is going on in the economy. PNC has strong capabilities and resources in place to guide them through those decisions and other business needs.”

Ready to Help

PNC Corporate Banking combines the knowledge, insight, and decision making of a local team with the strength and resources of one of the country’s largest banks, to deliver sophisticated banking and advisory solutions. For more information, reach out to your PNC Relationship Manager or contact us.

Schedule an appointment

SCHEDULE NOW

Find a branch near you

FIND NOW

Important Legal Disclosures and Information

The article you read was prepared for general information purposes only and is not intended as legal, tax or accounting advice or as recommendations to engage in any specific transaction, including with respect to any securities of PNC, and do not purport to be comprehensive. Under no circumstances should any information contained in this article be used or considered as an offer or commitment, or a solicitation of an offer or commitment, to participate in any particular transaction or strategy. Any reliance upon any such information is solely and exclusively at your own risk. Please consult your own counsel, accountant or other advisor regarding your specific situation. Neither PNC Bank nor any other subsidiary of The PNC Financial Services Group, Inc. will be responsible for any consequences of reliance upon any opinion or statement contained here, or any omission. The opinions expressed in this article are not necessarily the opinions of PNC Bank or any of its affiliates, directors, officers or employees.

These materials are furnished for the use of PNC and its clients and do not constitute the provision of investment, legal, or tax advice to any person. They are not prepared with respect to the specific investment objectives, financial situation, or particular needs of any person. Use of these materials is dependent upon the judgment and analysis applied by duly authorized investment personnel who consider a client’s individual account circumstances. Persons reading these materials should consult with their PNC account representative regarding the appropriateness of investing in any securities or adopting any investment strategies discussed or recommended herein and should understand that statements regarding future prospects may not be realized. The information contained herein was obtained from sources deemed reliable. Such information is not guaranteed as to its accuracy, timeliness, or completeness by PNC. The information contained and the opinions expressed herein are subject to change without notice. Past performance is no guarantee of future results. Neither the information presented nor any opinion expressed herein constitutes an offer to buy or sell, nor a recommendation to buy or sell, any security or financial instrument. Accounts managed by PNC and its affiliates may take positions from time to time in securities recommended and followed by PNC affiliates. Securities are not bank deposits, nor are they backed or guaranteed by PNC or any of its affiliates, and are not issued by, insured by, guaranteed by, or obligations of the FDIC or the Federal Reserve Board. Securities involve investment risks, including possible loss of principal.

Indices or Benchmarks. Indices are unmanaged, are not available for direct investment, and are not subject to management fees, transaction costs or other types of expenses that an account may incur. Indices performance results do not represent, and are not necessarily indicative of, the results that may be achieved in accounts investing in the corresponding investment strategy; actual account returns may vary significantly. For definitions of Indices/Benchmarks used herein, please refer to www.pnc.com/indexdefinitions.

The PNC Financial Services Group, Inc. provides investment consulting and wealth management, fiduciary services, FDIC-insured banking products and services, and lending of funds to individual clients through PNC Bank, National Association (“PNC Bank”), which is a Member FDIC, and provides specific fiduciary and agency services to individual clients through PNC Delaware Trust Company or PNC Ohio Trust Company. PNC provides various discretionary and nondiscretionary investment, trustee, custody, consulting, and related services to institutional clients through PNC Bank, and investment management services through PNC Capital Advisors, LLC, an SEC-registered investment adviser and wholly-owned subsidiary of PNC Bank. PNC does not provide legal, tax, or accounting advice unless, with respect to tax advice, PNC Bank has entered into a written tax services agreement. PNC Bank is not registered as a municipal advisor under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

FINRA BrokerCheck

Check the background of PNC Capital Markets LLC on FINRA's BrokerCheck at https://brokercheck.finra.org/.

PNC Capital Markets Disclosure

PNC Capital Markets LLC (“PNCCM”), member of FINRA and SIPC, is an affiliate of PNC Bank, National Association (“PNC Bank”). PNC Bank and PNCCM are subsidiaries of The PNC Financial Services Group, Inc. (“PNC”).

Important Investor Information – Securities, insurance, foreign exchange, and derivative products are:
Not FDIC Insured • Not Bank Guaranteed • Not A Deposit
• Not Insured By Any Federal Government Agency • May Lose Value

Swap Dealer Disclosure

“PNC” is a registered mark of The PNC Financial Services Group, Inc.

PNC General Disclosure https://www.pnc.com/en/corporate-and-institutional/pnc-general-disclosure.html