NEW YORK, March 8, 2002 (PRIMEZONE) -- According to Pomerantz Haudek Block Grossman & Gross LLP, www.pomerantzlaw.com, which has filed a class action lawsuit against PNC Financial Services Group, Inc. ("PNC" or the "Company") (NYSE:PNC), three of the Company's senior officials and Ernst & Young, on behalf of all those persons or entities who purchased the securities of PNC during the period between May 15, 2001 through January 28, 2002, inclusive (the "Class Period"), shareholders have until Tuesday April 2, 2002 to seek appointment by the Court as one of the lead plaintiffs in this action
The lawsuit charges that PNC issued materially false and misleading statements to the market concerning the Company's earnings prospects, results and reductions in loans, which allegedly mislead investors and concealed PNC's true financial condition. In particular, it is alleged that defendants failed to recognize the impairment of certain loans or charges related to PNC, and instead shifted these problem loans off PNC's books and into three separate investment entities created by the American International Group ("AIG") for the sole purpose of receiving such loans during each of the quarters during the Class Period. As a result, defendants misrepresented PNC's earnings as well as the Company's ability to reduce its liabilities related to non-performing assets. Defendants' failure to conform with Generally Accepted Accounting Standards ("GAAP") produced inflated earnings and misled investors as to PNC's true financial condition.
The lawsuit further alleges that while acting as auditor and a consultant for PNC, Ernst & Young was also acting as a consultant for AIG. As PNC's auditor, Ernst & Young approved PNC's transactions with AIG and issued a written statement approving the accounting for them.
On January 29, 2002, PNC announced that the Federal Reserve Board ("FRB") had demanded that the Company consolidate its financial results with the investment entities created by AIG, effectively requiring the Company to reflect the true nature of these loans. In addition, the Company announced that the FRB and the Securities and Exchange Commission ("SEC") were making inquiries about PNC's transactions. As a result of the FRB's actions, PNC was compelled to reduce its 2001 net income by approximately $155 million. In addition, the Company further announced that it will revise fourth quarter 2001 results and restate earnings for the second and third quarters of 2001. Following the news of these disclosures, PNC's stock fell dramatically to close on January 29, 2002 at $56.08, down $5.79 or nearly 10%, from its close on January 28, 2002 at $61.87
If you purchased the securities of PNC during the Class Period, you have until Tuesday April 2, 2002 to ask the Court to appoint you as one of the lead plaintiffs for the Class. In order to serve as lead plaintiff, you must meet certain legal requirements. If you wish to review a copy of the Complaint, to discuss this action or have any questions, please contact Andrew G. Tolan, Esq. of the Pomerantz firm at 888-476-6529 (or (888) 4-POMLAW), toll free, or at agtolan@pomlaw.com by e-mail. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca