In February this year, Bloomberg reported that big banks in the U.S had declared war on Venmo. However, for Mike Lyons, the PNC executive, fintech startups are valuable partners and not necessarily competitors.
The Charlotte Observer has found out that Lyon has spent a significant amount of his time meeting with executives and investors of fintech startups in a bid to find out the ways in which PNC can use new technology to enhance its products and services. So far, PNC has invested in several companies and launched an incubator that seeks to work with innovators and academics to develop fintech solutions.
Lyon says that all along, PNC has had an open door policy and has never viewed fintech startups as enemies. The bank’s policy is to cultivate a good working relationship with these startups. Nevertheless, PNC is one of the American banks rolling out a money transfer service to compete with Venmo and other payment apps. The focus is to give its clients faster, secure and easier payments services.
PNC began operations in the Carolinas in 2012 with the purchase of RBC’s U.S unit. The bank is on the list of a few banks that have invested in early warning services, thanks to its Zelle innovation. Currently, the early warning services are available to PNC’s customers using virtual wallets but will be available to everyone else beginning this July.
Lyons is the head of the corporate and institutional group at PNC, a role that he has held since the fall of 2011 when he joined the bank. Before then, he was working as the head of strategic planning and corporate development at the Charlotte-based Bank of America. He was also a key advisor to Brian Moynihan and was instrumental in asset sales and other initiatives intended to bulk up capital.
The corporate and institutional banking department that Lyons heads deals with the provision of treasury management, lending, and capital markets-related services to both mid-size and large organisations. In 2016, the business earned about $2 billion flat from the previous year. This accounted for slightly more than half of PNC’s overall income.
According to Lyons, the bank’s business differs from those of its peers in that it does not focus on building a large investment banking business. For instance, it is not involved in trading in securities. This strategy is intended to ensure that there is no possibility of conflict between a corporate client and an investor client involved in the same transaction. However, the bank has some capital markets operations through Solebury Capital, that advises companies on initial public offerings and Harris Williams & Co., which advises mid-size companies on mergers.
PNC believes that fintech is not a line of business but rather a way of doing business. For this reason, it has over the last few years spent about $1.2 billion in upgrading its core systems such as cyber security. Currently, the focus is on developing more solutions such as Zelle to improve customer service and experience.