Achieves Record Earnings for the Full Year 2013
MINNEAPOLIS--(BUSINESS WIRE)--Jan. 22, 2014--
U.S. Bancorp (NYSE:USB) today reported net income of $1,456 million for
the fourth quarter of 2013, or $.76 per diluted common share, compared
with $1,420 million, or $.72 per diluted common share, in the fourth
quarter of 2012.
Highlights for the full year 2013 included:
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Record full year 2013 net income of $5.8 billion, 3.3 percent higher
than 2012
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Record full year diluted earnings per common share of $3.00, 5.6
percent higher than 2012
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Industry-leading performance measures, including return on average
assets of 1.65 percent, return on average common equity of 15.8
percent and efficiency ratio of 52.4 percent
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Returned 71 percent of 2013 earning to shareholders through
dividend and share buybacks
Highlights for the fourth quarter of 2013 included:
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Industry-leading performance ratios, including:
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Return on average assets of 1.62 percent
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Return on average common equity of 15.4 percent
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Efficiency ratio of 54.9 percent
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Growth in average total loans of 5.7 percent over the fourth quarter
of 2012 (7.3 percent excluding covered loans) and 1.5 percent on a
linked quarter basis (1.9 percent excluding covered loans)
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Growth in average total commercial loans of 7.8 percent over the
fourth quarter of 2012 and 1.3 percent over the third quarter of
2013
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Growth in average total commercial real estate loans of 6.7
percent over the fourth quarter of 2012 and 2.1 percent over the
third quarter of 2013
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Growth in average commercial and commercial real estate
commitments of 10.1 percent year-over-year and 2.7 percent over
the prior quarter
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Strong new lending activity of $58.4 billion during the fourth
quarter, including:
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$40.6 billion of new and renewed commercial and commercial real
estate commitments
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$2.7 billion of lines related to new credit card accounts
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$15.1 billion of mortgage and other retail loan originations
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Continued strong growth in average total deposits of 5.4 percent over
the fourth quarter of 2012 and 1.8 percent on a linked quarter basis.
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Average low cost deposits, including noninterest-bearing and total
savings deposits, grew by 8.5 percent year-over-year and 4.8
percent linked quarter
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Net charge-offs declined on both a linked quarter and year-over-year
basis. Provision for credit losses was $35 million less than net
charge-offs
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Net charge-offs were $16 million (4.9 percent) lower than the
third quarter of 2013
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Annualized net charge-offs to average total loans ratio decreased
to .53 percent
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Allowance to period-end loans was 1.93 percent at December 31, 2013
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Nonperforming assets decreased on both a linked quarter and
year-over-year basis
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Nonperforming assets (excluding covered assets) decreased 3.6
percent from the third quarter of 2013
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Allowance to nonperforming assets (excluding covered assets) was
242 percent at December 31, 2013, compared with 235 percent at
September 30, 2013, and 218 percent at December 31, 2012
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Tax rate on a taxable-equivalent basis was 23.8 percent for the fourth
quarter, compared with 29.5 percent for the third quarter of 2013,
principally reflecting the impact of accounting presentation changes
related to investments in tax-advantaged projects
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Change had no impact on net income attributable to U.S. Bancorp
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Change increased other expense by $31 million, decreased net
(income) loss attributable to noncontrolling interests by $53
million and decreased income tax expense by $84 million compared
with the third quarter of 2013
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Capital generation continues to reinforce capital position and return.
Ratios at December 31, 2013, were:
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Tier 1 capital ratio of 11.2 percent
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Total risk based capital ratio of 13.2 percent
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Tier 1 common equity to risk-weighted assets ratio of 9.4 percent
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Common equity tier 1 ratio of 8.8 percent estimated using final
rules for the Basel III standardized approach
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Returned 65 percent of fourth quarter earnings to shareholders
through dividends and the buyback of 13 million common shares
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EARNINGS SUMMARY
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Table 1
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($ in millions, except per-share data)
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Percent
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Percent
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Change
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Change
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4Q
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3Q
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4Q
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4Q13 vs
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4Q13 vs
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Full Year
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Full Year
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Percent
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2013
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2013
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2012
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3Q13
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4Q12
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2013
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2012
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Change
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Net income attributable to U.S. Bancorp
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$1,456
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$1,468
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$1,420
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(.8
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2.5
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$5,836
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$5,647
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3.3
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Diluted earnings per common share
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$.76
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$.76
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$.72
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--
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5.6
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$3.00
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$2.84
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5.6
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Return on average assets (%)
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1.62
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1.65
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1.62
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1.65
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1.65
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Return on average common equity (%)
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15.4
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15.8
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15.6
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15.8
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16.2
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Net interest margin (%)
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3.40
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3.43
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3.55
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3.44
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3.58
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Efficiency ratio (%)
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54.9
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52.4
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52.6
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52.4
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51.5
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Tangible efficiency ratio (%) (a)
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53.7
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51.3
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51.3
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51.3
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50.2
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Dividends declared per common share
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$.230
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$.230
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$.195
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--
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17.9
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$.885
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$.780
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13.5
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Book value per common share (period-end)
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$19.92
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$19.31
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$18.31
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3.2
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8.8
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(a) Computed as noninterest expense divided by the sum of net
interest income on a taxable-equivalent basis and noninterest
income excluding net securities gains (losses) and intangible
amortization.
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Net income attributable to U.S. Bancorp was $1,456 million for the
fourth quarter of 2013, 2.5 percent higher than the $1,420 million for
the fourth quarter of 2012, and .8 percent lower than the $1,468 million
for the third quarter of 2013. Diluted earnings per common share of $.76
in the fourth quarter of 2013 were $.04 higher than the fourth quarter
of 2012 and equal to the previous quarter. Return on average assets and
return on average common equity were 1.62 percent and 15.4 percent,
respectively, for the fourth quarter of 2013, compared with 1.62 percent
and 15.6 percent, respectively, for the fourth quarter of 2012. The
provision for credit losses was lower than net charge-offs by $35
million in the fourth quarter of 2013, $30 million lower in the third
quarter of 2013 and $25 million lower in the fourth quarter of 2012.
U.S. Bancorp Chairman, President and Chief Executive Officer Richard K.
Davis said, “Today U.S. Bancorp reported record earnings for full year
2013 of $5.8 billion, or $3.00 per diluted common share. The 2013
results included top-tier returns on average assets and average common
equity of 1.65 percent and 15.8 percent, respectively, and an efficiency
ratio of 52.4 percent. I am particularly proud to have achieved these
results during a year marked by slow economic growth, a significant
pullback in mortgage activity and continued regulatory and legislative
change and uncertainty. Our results clearly demonstrate the benefits we
derive from our diverse mix of businesses and conservative risk profile.
“Our fourth quarter earnings per diluted common share were $.76, a 5.6
percent increase over the same quarter of 2012. The Company’s balance
sheet continued to expand during the quarter with average loans higher
by 5.7 percent over the prior year and, as expected, 1.5 percent, or 6
percent annualized, on a linked quarter basis. Virtually all loan
categories posted growth versus comparable time periods. Fee-based
revenue was negatively impacted this quarter on both a year-over-year
and linked quarter basis by the reduction in mortgage banking activity,
but the impact was muted by growth in other fee businesses and, overall,
by prudent expense management.
“Credit quality continues to be strong, as total net charge-offs and
nonperforming assets declined, again, in the fourth quarter. Net
charge-offs were .53 percent of average total loans, compared with .57
percent in the previous quarter and .85 percent in the same quarter of
2012. Nonperforming assets, excluding covered assets, declined by $67
million, or 3.6 percent from the prior quarter.
“We continue to generate significant capital each quarter, while
returning a majority of our earnings to shareholders in the form of
share buybacks and dividends. Our tier 1 capital ratio at December 31st
was 11.2 percent, and our tier 1 common equity ratio was 9.4 percent.
Further, our common equity tier 1 ratio at December 31st, estimated
using final rules for the Basel III standardized approach, was 8.8
percent. During 2013, we returned $4.0 billion, or 71 percent, of our
earnings to shareholders through dividends and the repurchase of 65
million shares of stock. We completed and submitted our 2014
Comprehensive Capital Plan to the Federal Reserve in early January, and
await regulatory approval to raise our dividend and continue our stock
buyback program in 2014.
“On January 7th we announced the purchase of a Chicago branch franchise
owned by RBS Citizens Financial Group. The investment will nearly double
our market share in this important market within our footprint,
strengthening our position and adding products, services and convenience
for new and existing customers, as well as value for our shareholders.
“Our Company’s results are directly tied to the hard work and dedication
of our employees, and I want to take the opportunity today to thank them
for their contribution to our success. On January 14th, we held our 8th
annual All Employee Meeting. The great majority of our employees
attended one of seventy-four meetings scheduled to accommodate numerous
time zones across the U.S., Canada and Europe. Employees gathered in
person, on the phone, via the web and by satellite connection to hear
about our 2013 accomplishments and our new initiatives for 2014. It was
a pleasure to once again make this annual connection with our employees.
Our employees are engaged and passionate about serving our customers and
communities, and I am proud to serve with them.
“I am very pleased with our record full year 2013 earnings. As we look
forward to the coming year, we are mindful of the strength of our
Company and how we, as a bank, remain an integral part of the growth and
vibrancy of the nation’s economy, our communities and the customers we
serve and support. We are focused on the future and confident in our
ability to deliver outstanding products, service and results for the
benefit of our customers, communities, employees and, most importantly,
our shareholders.”
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INCOME STATEMENT HIGHLIGHTS
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Table 2
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(Taxable-equivalent basis, $ in millions, except per-share data)
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Percent
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Percent
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Change
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Change
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4Q
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3Q
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4Q
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4Q13 vs
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4Q13 vs
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Full Year
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Full Year
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Percent
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2013
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2013
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2012
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3Q13
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4Q12
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2013
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2012
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Change
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Net interest income
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$2,733
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$2,714
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$2,783
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.7
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(1.8
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$10,828
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$10,969
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(1.3
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Noninterest income
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2,156
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2,177
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2,329
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(1.0
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(7.4
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8,774
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9,319
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(5.8
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Total net revenue
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4,889
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4,891
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5,112
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--
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(4.4
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19,602
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20,288
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(3.4
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Noninterest expense
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2,682
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2,565
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2,686
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4.6
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(.1
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10,274
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10,456
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(1.7
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Income before provision and taxes
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2,207
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2,326
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2,426
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(5.1
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(9.0
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9,328
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9,832
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(5.1
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Provision for credit losses
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277
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298
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443
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(7.0
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(37.5
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1,340
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1,882
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(28.8
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Income before taxes
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1,930
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2,028
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1,983
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(4.8
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(2.7
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7,988
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7,950
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.5
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Taxable-equivalent adjustment
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56
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56
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56
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--
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--
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224
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224
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--
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Applicable income taxes
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403
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542
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552
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(25.6
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(27.0
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2,032
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2,236
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(9.1
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Net income
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1,471
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1,430
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1,375
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2.9
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7.0
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5,732
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5,490
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4.4
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Net (income) loss attributable to noncontrolling interests
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(15
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38
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45
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nm
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nm
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104
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157
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(33.8
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Net income attributable to U.S. Bancorp
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$1,456
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$1,468
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$1,420
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(.8
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2.5
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$5,836
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$5,647
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3.3
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Net income applicable to U.S. Bancorp common shareholders
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$1,389
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$1,400
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$1,349
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(.8
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3.0
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$5,552
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$5,383
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3.1
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Diluted earnings per common share
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$.76
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$.76
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$.72
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--
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5.6
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$3.00
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$2.84
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5.6
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Net income attributable to U.S. Bancorp for the fourth quarter of 2013
was $36 million (2.5 percent) higher than the fourth quarter of 2012,
and $12 million (.8 percent) lower than the third quarter of 2013. The
increase in net income year-over-year was primarily due to a lower
provision for credit losses, partially offset by a reduction in total
net revenue, primarily driven by mortgage banking revenue. The decrease
in net income on a linked quarter basis was principally due to a
decrease in mortgage banking revenue and seasonally higher expense,
partially offset by a favorable variance in the provision for credit
losses.
Total net revenue on a taxable-equivalent basis for the fourth quarter
of 2013 was $4,889 million; $223 million (4.4 percent) lower than the
fourth quarter of 2012, reflecting a 1.8 percent decrease in net
interest income and a 7.4 percent decrease in noninterest income. Net
interest income declined year-over-year, as an increase in average
earning assets was offset by a decrease in the net interest margin.
Noninterest income declined year-over-year, primarily due to lower
mortgage banking revenue. Total net revenue on a taxable-equivalent
basis was basically flat on a linked quarter basis as a 1.0 percent
decrease in noninterest income, driven by lower mortgage banking
revenue, was partially offset by seasonally higher revenues in other
business lines and an increase in net interest income.
Total noninterest expense in the fourth quarter of 2013 was $2,682
million; $4 million (.1 percent) lower than the fourth quarter of 2012
and $117 million (4.6 percent) higher than the third quarter of 2013.
The modest decrease in total noninterest expense year-over-year was
primarily due to the impact of an $80 million
mortgage-foreclosure-related regulatory settlement accrual in the fourth
quarter of 2012 and a reduction in mortgage servicing review-related
professional services expense in the current quarter, offset by higher
costs related to investments in tax-advantaged projects and employee
benefits expense. The increase in total noninterest expense on a linked
quarter basis was primarily due to higher costs related to investments
in tax-advantaged projects, seasonally higher professional services
expense and increased marketing and business development expense. In
addition to an increase due to seasonality, tax-advantaged investment
expense reflected the accounting presentation changes in the fourth
quarter of 2013.
The Company’s provision for credit losses for the fourth quarter of 2013
was $277 million, $21 million lower than the prior quarter and $166
million lower than the fourth quarter of 2012. The provision for credit
losses was lower than net charge-offs by $35 million in the fourth
quarter of 2013, $30 million lower in the third quarter of 2013 and $25
million lower in the fourth quarter of 2012. Net charge-offs in the
fourth quarter of 2013 were $312 million, compared with $328 million in
the third quarter of 2013 and $468 million in the fourth quarter of
2012. Given current economic conditions, the Company expects the level
of net charge-offs to increase modestly in the first quarter of 2014.
Nonperforming assets include assets originated or acquired by the
Company, as well as loans and other real estate acquired under FDIC loss
sharing agreements that substantially reduce the risk of credit losses
to the Company (“covered assets”). Excluding covered assets,
nonperforming assets were $1,813 million at December 31, 2013, compared
with $1,880 million at September 30, 2013, and $2,088 million at
December 31, 2012. The decrease in nonperforming assets, excluding
covered assets, compared with a year ago was driven primarily by
reductions in the commercial mortgage portfolio, as well as by
improvement in construction and development and credit card loans.
Covered nonperforming assets were $224 million at December 31, 2013,
compared with $332 million at September 30, 2013, and $583 million at
December 31, 2012. The ratio of the allowance for credit losses to
period-end loans, including covered loans, was 1.93 percent at December
31, 2013, compared with 1.98 percent at September 30, 2013, and 2.12
percent at December 31, 2012. The Company expects total nonperforming
assets to remain relatively stable in the first quarter of 2014.
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NET INTEREST INCOME
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Table 3
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(Taxable-equivalent basis; $ in millions)
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q
|
|
|
3Q
|
|
|
4Q
|
|
|
4Q13 vs
|
|
|
4Q13 vs
|
|
|
Full Year
|
|
|
Full Year
|
|
|
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
3Q13
|
|
|
4Q12
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
Components of net interest income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income on earning assets
|
|
|
$3,125
|
|
|
|
$3,125
|
|
|
|
$3,254
|
|
|
|
$--
|
|
|
|
$(129
|
)
|
|
|
$12,513
|
|
|
|
$13,112
|
|
|
|
$(599
|
)
|
|
Expense on interest-bearing liabilities
|
|
|
392
|
|
|
|
411
|
|
|
|
471
|
|
|
|
(19
|
)
|
|
|
(79
|
)
|
|
|
1,685
|
|
|
|
2,143
|
|
|
|
(458
|
)
|
|
Net interest income
|
|
|
$2,733
|
|
|
|
$2,714
|
|
|
|
$2,783
|
|
|
|
$19
|
|
|
|
$(50
|
)
|
|
|
$10,828
|
|
|
|
$10,969
|
|
|
|
$(141
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average yields and rates paid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning assets yield
|
|
|
3.89
|
%
|
|
|
3.95
|
%
|
|
|
4.15
|
%
|
|
|
(.06
|
)%
|
|
|
(.26
|
)%
|
|
|
3.97
|
%
|
|
|
4.28
|
%
|
|
|
(.31
|
)%
|
|
Rate paid on interest-bearing liabilities
|
|
|
.68
|
|
|
|
.71
|
|
|
|
.84
|
|
|
|
(.03
|
)
|
|
|
(.16
|
)
|
|
|
.73
|
|
|
|
.95
|
|
|
|
(.22
|
)
|
|
Gross interest margin
|
|
|
3.21
|
%
|
|
|
3.24
|
%
|
|
|
3.31
|
%
|
|
|
(.03
|
)%
|
|
|
(.10
|
)%
|
|
|
3.24
|
%
|
|
|
3.33
|
%
|
|
|
(.09
|
)%
|
|
Net interest margin
|
|
|
3.40
|
%
|
|
|
3.43
|
%
|
|
|
3.55
|
%
|
|
|
(.03
|
)%
|
|
|
(.15
|
)%
|
|
|
3.44
|
%
|
|
|
3.58
|
%
|
|
|
(.14
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average balances
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities (a)
|
|
|
$77,248
|
|
|
|
$74,988
|
|
|
|
$72,887
|
|
|
|
$2,260
|
|
|
|
$4,361
|
|
|
|
$75,046
|
|
|
|
$72,501
|
|
|
|
$2,545
|
|
|
Loans
|
|
|
232,791
|
|
|
|
229,362
|
|
|
|
220,266
|
|
|
|
3,429
|
|
|
|
12,525
|
|
|
|
227,474
|
|
|
|
215,374
|
|
|
|
12,100
|
|
|
Earning assets
|
|
|
319,516
|
|
|
|
315,060
|
|
|
|
312,227
|
|
|
|
4,456
|
|
|
|
7,289
|
|
|
|
315,139
|
|
|
|
306,270
|
|
|
|
8,869
|
|
|
Interest-bearing liabilities
|
|
|
229,201
|
|
|
|
230,825
|
|
|
|
224,219
|
|
|
|
(1,624
|
)
|
|
|
4,982
|
|
|
|
230,400
|
|
|
|
225,466
|
|
|
|
4,934
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Excludes unrealized gain (loss)
|
|
|
Net Interest Income
Net interest income on a taxable-equivalent basis in the fourth quarter
of 2013 was $2,733 million, a decrease of $50 million (1.8 percent) from
the fourth quarter of 2012. The decrease was the result of lower rates
on loans and investment securities, partially offset by growth in the
corresponding average balances, continued growth in lower cost core deposit
funding and the positive impact from maturities of higher-rate long-term
debt. Average earning assets were $7.3 billion (2.3 percent) higher than
the fourth quarter of 2012, driven by increases of $12.5 billion (5.7
percent) in average total loans and $4.4 billion (6.0 percent) in
average investment securities, partially offset by decreases of $5.8
billion (66.2 percent) in average loans held for sale and $3.8 billion
(37.0 percent) in other earning assets, principally due to the
deconsolidation of certain community development and tax-advantaged
investment variable interest entities during the second quarter of 2013.
Net interest income increased $19 million (.7 percent) on a linked
quarter basis, primarily driven by a $4.5 billion (1.4 percent) increase
in average earning assets, reflecting growth in average total loans and
investment securities, partially offset by a decline in average loans
held for sale, and the positive impact of seasonally lower rebate costs
on the Company’s government card program. The net interest margin in the
fourth quarter of 2013 was 3.40 percent, compared with 3.55 percent in
the fourth quarter of 2012, and 3.43 percent in the third quarter of
2013. The decline in the net interest margin on a year-over-year basis
primarily reflected lower reinvestment rates on investment securities,
as well as growth in the portfolio, and lower rates on loans, partially
offset by lower rates on deposits and a reduction in higher cost
long-term debt. On a linked quarter basis, the modest reduction in net
interest margin was principally due to growth in lower rate investment
securities, as well as the impact of higher cash balances at the Federal
Reserve.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE LOANS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 4
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
Percent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q
|
|
|
3Q
|
|
|
4Q
|
|
|
4Q13 vs
|
|
|
4Q13 vs
|
|
|
Full Year
|
|
|
Full Year
|
|
|
Percent
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
3Q13
|
|
|
4Q12
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
|
$63,714
|
|
|
$62,856
|
|
|
$58,552
|
|
|
1.4
|
|
|
|
8.8
|
|
|
|
$62,012
|
|
|
$55,232
|
|
|
12.3
|
|
|
Lease financing
|
|
|
5,210
|
|
|
5,208
|
|
|
5,377
|
|
|
--
|
|
|
|
(3.1
|
)
|
|
|
5,262
|
|
|
5,598
|
|
|
(6.0
|
)
|
|
Total commercial
|
|
|
68,924
|
|
|
68,064
|
|
|
63,929
|
|
|
1.3
|
|
|
|
7.8
|
|
|
|
67,274
|
|
|
60,830
|
|
|
10.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial mortgages
|
|
|
31,780
|
|
|
31,546
|
|
|
30,762
|
|
|
.7
|
|
|
|
3.3
|
|
|
|
31,429
|
|
|
30,493
|
|
|
3.1
|
|
|
Construction and development
|
|
|
7,538
|
|
|
6,955
|
|
|
6,089
|
|
|
8.4
|
|
|
|
23.8
|
|
|
|
6,808
|
|
|
6,012
|
|
|
13.2
|
|
|
Total commercial real estate
|
|
|
39,318
|
|
|
38,501
|
|
|
36,851
|
|
|
2.1
|
|
|
|
6.7
|
|
|
|
38,237
|
|
|
36,505
|
|
|
4.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgages
|
|
|
50,732
|
|
|
49,139
|
|
|
43,156
|
|
|
3.2
|
|
|
|
17.6
|
|
|
|
47,982
|
|
|
40,290
|
|
|
19.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit card
|
|
|
17,366
|
|
|
16,931
|
|
|
16,588
|
|
|
2.6
|
|
|
|
4.7
|
|
|
|
16,813
|
|
|
16,653
|
|
|
1.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail leasing
|
|
|
5,847
|
|
|
5,664
|
|
|
5,384
|
|
|
3.2
|
|
|
|
8.6
|
|
|
|
5,654
|
|
|
5,222
|
|
|
8.3
|
|
|
Home equity and second mortgages
|
|
|
15,488
|
|
|
15,648
|
|
|
16,950
|
|
|
(1.0
|
)
|
|
|
(8.6
|
)
|
|
|
15,887
|
|
|
17,451
|
|
|
(9.0
|
)
|
|
Other
|
|
|
26,059
|
|
|
25,682
|
|
|
25,595
|
|
|
1.5
|
|
|
|
1.8
|
|
|
|
25,584
|
|
|
25,265
|
|
|
1.3
|
|
|
Total other retail
|
|
|
47,394
|
|
|
46,994
|
|
|
47,929
|
|
|
.9
|
|
|
|
(1.1
|
)
|
|
|
47,125
|
|
|
47,938
|
|
|
(1.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans, excluding covered loans
|
|
|
223,734
|
|
|
219,629
|
|
|
208,453
|
|
|
1.9
|
|
|
|
7.3
|
|
|
|
217,431
|
|
|
202,216
|
|
|
7.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Covered loans
|
|
|
9,057
|
|
|
9,733
|
|
|
11,813
|
|
|
(6.9
|
)
|
|
|
(23.3
|
)
|
|
|
10,043
|
|
|
13,158
|
|
|
(23.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
|
$232,791
|
|
|
$229,362
|
|
|
$220,266
|
|
|
1.5
|
|
|
|
5.7
|
|
|
|
$227,474
|
|
|
$215,374
|
|
|
5.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average total loans were $12.5 billion (5.7 percent) higher in the
fourth quarter of 2013 than the fourth quarter of 2012, driven by growth
in residential mortgages (17.6 percent), commercial loans (8.8 percent),
retail leasing (8.6 percent), total commercial real estate (6.7
percent), credit card (4.7 percent), and other retail loans (1.8
percent). These increases were partially offset by declines in home
equity and second mortgages (8.6 percent), lease financing (3.1 percent)
and covered loans (23.3 percent). Average total loans, excluding covered
loans, were higher by 7.3 percent year-over-year. Average total loans
were $3.4 billion (1.5 percent) higher in the fourth quarter of 2013
than the third quarter of 2013, driven by increases in residential
mortgages (3.2 percent), retail leasing (3.2 percent), credit card (2.6
percent), total commercial real estate (2.1 percent), commercial loans
(1.4 percent) and other retail loans (1.5 percent), partially offset by
decreases in home equity and second mortgages (1.0 percent) and covered
loans (6.9 percent). Excluding covered loans, average total loans grew
by 1.9 percent on a linked quarter basis.
Average investment securities in the fourth quarter of 2013 were $4.4
billion (6.0 percent) higher year-over-year and $2.3 billion (3.0
percent) higher than the prior quarter. The increases were primarily due
to purchases of U.S. government agency-backed securities in anticipation
of final liquidity coverage ratio regulatory requirements, net of
prepayments and maturities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AVERAGE DEPOSITS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 5
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
Percent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q
|
|
|
3Q
|
|
|
4Q
|
|
|
4Q13 vs
|
|
|
4Q13 vs
|
|
|
Full Year
|
|
|
Full Year
|
|
|
Percent
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
3Q13
|
|
|
4Q12
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing deposits
|
|
|
$74,468
|
|
|
$68,264
|
|
|
$72,655
|
|
|
9.1
|
|
|
|
2.5
|
|
|
|
$69,020
|
|
|
$67,241
|
|
|
2.6
|
|
|
Interest-bearing savings deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest checking
|
|
|
50,112
|
|
|
48,235
|
|
|
45,168
|
|
|
3.9
|
|
|
|
10.9
|
|
|
|
48,792
|
|
|
45,433
|
|
|
7.4
|
|
|
Money market savings
|
|
|
57,550
|
|
|
55,982
|
|
|
49,545
|
|
|
2.8
|
|
|
|
16.2
|
|
|
|
55,512
|
|
|
46,874
|
|
|
18.4
|
|
|
Savings accounts
|
|
|
32,235
|
|
|
32,083
|
|
|
30,231
|
|
|
.5
|
|
|
|
6.6
|
|
|
|
31,916
|
|
|
29,596
|
|
|
7.8
|
|
|
Total of savings deposits
|
|
|
139,897
|
|
|
136,300
|
|
|
124,944
|
|
|
2.6
|
|
|
|
12.0
|
|
|
|
136,220
|
|
|
121,903
|
|
|
11.7
|
|
|
Time certificates of deposit less than $100,000
|
|
|
11,979
|
|
|
12,495
|
|
|
13,956
|
|
|
(4.1
|
)
|
|
|
(14.2
|
)
|
|
|
12,804
|
|
|
14,509
|
|
|
(11.8
|
)
|
|
Time deposits greater than $100,000
|
|
|
30,562
|
|
|
35,309
|
|
|
32,292
|
|
|
(13.4
|
)
|
|
|
(5.4
|
)
|
|
|
32,413
|
|
|
32,057
|
|
|
1.1
|
|
|
Total interest-bearing deposits
|
|
|
182,438
|
|
|
184,104
|
|
|
171,192
|
|
|
(.9
|
)
|
|
|
6.6
|
|
|
|
181,437
|
|
|
168,469
|
|
|
7.7
|
|
|
Total deposits
|
|
|
$256,906
|
|
|
$252,368
|
|
|
$243,847
|
|
|
1.8
|
|
|
|
5.4
|
|
|
|
$250,457
|
|
|
$235,710
|
|
|
6.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average total deposits for the fourth quarter of 2013 were $13.1 billion
(5.4 percent) higher than the fourth quarter of 2012. Average
noninterest-bearing deposits increased $1.8 billion (2.5 percent)
year-over-year, mainly in balances related to corporate trust,
commercial real estate and commercial banking businesses. Average total
savings deposits were $15.0 billion (12.0 percent) higher
year-over-year, the result of growth in Consumer and Small Business
Banking, as well as corporate trust, institutional trust, government
banking and broker-dealer balances. Certificates of deposit less than
$100,000 were $2.0 billion (14.2 percent) lower due to maturities, while
time deposits greater than $100,000 decreased $1.7 billion (5.4
percent), primarily due to a decline in Consumer and Small Business
Banking and corporate trust balances, partially offset by an increase in
Wholesale and Commercial Real Estate balances. Time deposits greater
than $100,000 are managed as an alternative to other funding sources,
such as wholesale borrowing, based largely on relative pricing.
Average total deposits increased $4.5 billion (1.8 percent) over the
third quarter of 2013. Average noninterest-bearing deposits increased
$6.2 billion (9.1 percent) on a linked quarter basis, mainly in balances
related to Wholesale Banking and Commercial Real Estate and corporate
trust businesses. Average total savings deposits increased $3.6 billion
(2.6 percent), including increases in Consumer and Small Business
Banking, Wholesale and Commercial Real Estate Banking and institutional
trust balances. Compared with the third quarter of 2013, average time
certificates of deposit less than $100,000 declined $516 million (4.1
percent) due to maturities. Average time deposits greater than $100,000
decreased $4.7 billion (13.4 percent) on a linked quarter basis,
principally due to lower broker-dealer balances.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONINTEREST INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 6
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
Percent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q
|
|
|
3Q
|
|
|
4Q
|
|
|
4Q13 vs
|
|
|
4Q13 vs
|
|
|
Full Year
|
|
|
Full Year
|
|
|
Percent
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
3Q13
|
|
|
4Q12
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit and debit card revenue
|
|
|
$263
|
|
|
$244
|
|
|
|
$242
|
|
|
7.8
|
|
|
|
8.7
|
|
|
|
$965
|
|
|
$892
|
|
|
|
8.2
|
|
|
Corporate payment products revenue
|
|
|
166
|
|
|
192
|
|
|
|
178
|
|
|
(13.5
|
)
|
|
|
(6.7
|
)
|
|
|
706
|
|
|
744
|
|
|
|
(5.1
|
)
|
|
Merchant processing services
|
|
|
367
|
|
|
371
|
|
|
|
354
|
|
|
(1.1
|
)
|
|
|
3.7
|
|
|
|
1,458
|
|
|
1,395
|
|
|
|
4.5
|
|
|
ATM processing services
|
|
|
79
|
|
|
83
|
|
|
|
83
|
|
|
(4.8
|
)
|
|
|
(4.8
|
)
|
|
|
327
|
|
|
346
|
|
|
|
(5.5
|
)
|
|
Trust and investment management fees
|
|
|
297
|
|
|
280
|
|
|
|
276
|
|
|
6.1
|
|
|
|
7.6
|
|
|
|
1,139
|
|
|
1,055
|
|
|
|
8.0
|
|
|
Deposit service charges
|
|
|
177
|
|
|
180
|
|
|
|
170
|
|
|
(1.7
|
)
|
|
|
4.1
|
|
|
|
670
|
|
|
653
|
|
|
|
2.6
|
|
|
Treasury management fees
|
|
|
130
|
|
|
134
|
|
|
|
130
|
|
|
(3.0
|
)
|
|
|
--
|
|
|
|
538
|
|
|
541
|
|
|
|
(.6
|
)
|
|
Commercial products revenue
|
|
|
243
|
|
|
207
|
|
|
|
226
|
|
|
17.4
|
|
|
|
7.5
|
|
|
|
859
|
|
|
878
|
|
|
|
(2.2
|
)
|
|
Mortgage banking revenue
|
|
|
231
|
|
|
328
|
|
|
|
476
|
|
|
(29.6
|
)
|
|
|
(51.5
|
)
|
|
|
1,356
|
|
|
1,937
|
|
|
|
(30.0
|
)
|
|
Investment products fees
|
|
|
45
|
|
|
46
|
|
|
|
39
|
|
|
(2.2
|
)
|
|
|
15.4
|
|
|
|
178
|
|
|
150
|
|
|
|
18.7
|
|
|
Securities gains (losses), net
|
|
|
1
|
|
|
(3
|
)
|
|
|
3
|
|
|
nm
|
|
|
(66.7
|
)
|
|
|
9
|
|
|
(15
|
)
|
|
|
nm
|
|
Other
|
|
|
157
|
|
|
115
|
|
|
|
152
|
|
|
36.5
|
|
|
|
3.3
|
|
|
|
569
|
|
|
743
|
|
|
|
(23.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total noninterest income
|
|
|
$2,156
|
|
|
$2,177
|
|
|
|
$2,329
|
|
|
(1.0
|
)
|
|
|
(7.4
|
)
|
|
|
$8,774
|
|
|
$9,319
|
|
|
|
(5.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Income
Fourth quarter noninterest income was $2,156 million; $173 million (7.4
percent) lower than the fourth quarter of 2012 and $21 million (1.0
percent) lower than the third quarter of 2013. The year-over-year
decrease in noninterest income was principally due to a $245 million
(51.5 percent) reduction in mortgage banking revenue due to lower
origination and sales revenue. Growth in several fee categories helped
to offset the decline in mortgage banking revenue. Credit and debit card
revenue increased $21 million (8.7 percent) over the prior year due to
higher transaction volumes, including the impact of business expansion.
Merchant processing services revenue was $13 million (3.7 percent)
higher as a result of an increase in product fees and higher volumes.
Trust and investment management fees increased $21 million (7.6 percent)
year-over-year, reflecting improved market conditions and business
expansion. Deposit service charges were $7 million (4.1 percent) higher
as a result of pricing changes and an increase in monthly account fees
and account growth. Commercial products revenue increased $17 million
(7.5 percent) over the prior year, principally due to higher syndication
fees on tax-advantaged projects, while investment products fees
increased $6 million (15.4 percent) due to higher sales volumes and
fees. Offsetting these positive variances was a decline in corporate
payment products revenue of $12 million (6.7 percent), the result of
lower government-related transactions.
Noninterest income was $21 million (1.0 percent) lower in the fourth
quarter of 2013 than the third quarter of 2013, primarily due to a 29.6
percent reduction in mortgage banking revenue, which reflected an
unfavorable change in the valuation of mortgage servicing rights
(“MSRs”), net of hedging activities, and lower origination and sales
revenue. Partially offsetting the decline in mortgage banking revenue
linked quarter was growth in credit and debit card revenue, which
increased by $19 million (7.8 percent) due to seasonally higher sales
volumes. Trust and investment management fees were $17 million (6.1
percent) higher than the prior quarter due to improved market conditions
and account growth, including business expansion. Commercial products
revenue increased $36 million (17.4 percent), compared with the third
quarter, due to higher syndication fees on tax-advantaged projects and
an increase in commercial leasing and capital markets revenue. Other
revenue was $42 million (36.5 percent) higher on a linked quarter basis,
primarily due to higher equity investment and retail lease revenue.
Offsetting these positive variances was a decrease in corporate payments
products revenue of $26 million (13.5 percent), primarily due to the
impact of seasonally higher third quarter government-related transaction
volume.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NONINTEREST EXPENSE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 7
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
Percent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q
|
|
|
3Q
|
|
|
4Q
|
|
|
4Q13 vs
|
|
|
4Q13 vs
|
|
|
Full Year
|
|
|
Full Year
|
|
|
Percent
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
3Q13
|
|
|
4Q12
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
|
|
|
$1,103
|
|
|
$1,088
|
|
|
$1,083
|
|
|
1.4
|
|
|
|
1.8
|
|
|
|
$4,371
|
|
|
$4,320
|
|
|
1.2
|
|
|
Employee benefits
|
|
|
275
|
|
|
278
|
|
|
231
|
|
|
(1.1
|
)
|
|
|
19.0
|
|
|
|
1,140
|
|
|
945
|
|
|
20.6
|
|
|
Net occupancy and equipment
|
|
|
240
|
|
|
240
|
|
|
234
|
|
|
--
|
|
|
|
2.6
|
|
|
|
949
|
|
|
917
|
|
|
3.5
|
|
|
Professional services
|
|
|
118
|
|
|
94
|
|
|
166
|
|
|
25.5
|
|
|
|
(28.9
|
)
|
|
|
381
|
|
|
530
|
|
|
(28.1
|
)
|
|
Marketing and business development
|
|
|
103
|
|
|
85
|
|
|
103
|
|
|
21.2
|
|
|
|
--
|
|
|
|
357
|
|
|
388
|
|
|
(8.0
|
)
|
|
Technology and communications
|
|
|
209
|
|
|
214
|
|
|
214
|
|
|
(2.3
|
)
|
|
|
(2.3
|
)
|
|
|
848
|
|
|
821
|
|
|
3.3
|
|
|
Postage, printing and supplies
|
|
|
80
|
|
|
76
|
|
|
78
|
|
|
5.3
|
|
|
|
2.6
|
|
|
|
310
|
|
|
304
|
|
|
2.0
|
|
|
Other intangibles
|
|
|
56
|
|
|
55
|
|
|
66
|
|
|
1.8
|
|
|
|
(15.2
|
)
|
|
|
223
|
|
|
274
|
|
|
(18.6
|
)
|
|
Other
|
|
|
498
|
|
|
435
|
|
|
511
|
|
|
14.5
|
|
|
|
(2.5
|
)
|
|
|
1,695
|
|
|
1,957
|
|
|
(13.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total noninterest expense
|
|
|
$2,682
|
|
|
$2,565
|
|
|
$2,686
|
|
|
4.6
|
|
|
|
(.1
|
)
|
|
|
$10,274
|
|
|
$10,456
|
|
|
(1.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest Expense
Noninterest expense in the fourth quarter of 2013 totaled $2,682
million, a decrease of $4 million (.1 percent) from the fourth quarter
of 2012, and a $117 million (4.6 percent) increase from the third
quarter of 2013. The slight decrease in total noninterest expense
year-over-year was primarily the net result of lower professional
services expense due to a reduction in mortgage servicing review-related
costs and the positive impact year-over-year in other expense from an
$80 million mortgage foreclosure-related settlement accrual in the
fourth quarter of 2012, offset by higher tax-advantaged project costs,
including the accounting presentation changes in the current quarter,
and an increase in employee benefits expense, driven by higher pension
costs. In addition, other intangibles expense decreased $10 million
(15.2 percent), the result of the reduction or completion of the
amortization of certain intangibles, while other expense also benefited
from lower loan-related expenses including costs for other real estate
owned. Compensation expense was higher by $20 million (1.8 percent),
reflecting growth in staffing for business initiatives and the impact of
merit increases, partially offset by lower incentive and commission
expense. Net occupancy and equipment expense increased $6 million (2.6
percent) due to business initiatives, higher rent expense and
maintenance costs.
Noninterest expense increased $117 million (4.6 percent) on a linked
quarter basis, driven by higher costs related to tax-advantaged
projects, seasonally higher professional services expense and the timing
of marketing and business development projects. Compensation expense
increased $15 million (1.4 percent) compared with the prior quarter due
to staffing increases for business initiatives. Professional services
was $24 million (25.5 percent) higher compared with the third quarter of
2013 due to seasonally higher costs across a majority of the lines of
business. Marketing and business development expense increased $18
million (21.2 percent) due to the timing of various marketing programs
in Payments Services and Consumer and Small Business Banking. Other
expense was $63 million (14.5 percent) higher than the third quarter of
2013, principally due to higher costs related to investments in
tax-advantaged projects, reflecting higher volume and the accounting
presentation changes.
Provision for Income Taxes
The provision for income taxes for the fourth quarter of 2013 resulted
in a tax rate on a taxable-equivalent basis of 23.8 percent (effective
tax rate of 21.5 percent), reflecting the impact of the accounting
presentation changes related to investments in tax-advantaged projects.
The tax rates in the fourth quarter of 2012 and third quarter of 2013
were 30.7 percent (effective tax rate of 28.6 percent) and 29.5 percent
(effective tax rate of 27.5 percent), respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALLOWANCE FOR CREDIT LOSSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 8
|
|
|
|
($ in millions)
|
|
|
4Q
|
|
|
|
3Q
|
|
|
|
2Q
|
|
|
|
1Q
|
|
|
|
4Q
|
|
|
|
|
|
|
2013
|
|
% (b)
|
|
2013
|
|
% (b)
|
|
2013
|
|
% (b)
|
|
2013
|
|
% (b)
|
|
2012
|
|
% (b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, beginning of period
|
|
|
$4,578
|
|
|
|
|
$4,612
|
|
|
|
|
$4,708
|
|
|
|
|
$4,733
|
|
|
|
$4,771
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
|
33
|
|
|
.21
|
|
|
18
|
|
|
.11
|
|
|
34
|
|
|
.22
|
|
|
32
|
|
.22
|
|
47
|
|
|
.32
|
|
Lease financing
|
|
|
3
|
|
|
.23
|
|
|
(7
|
)
|
|
(.53
|
)
|
|
4
|
|
|
.31
|
|
|
3
|
|
.23
|
|
5
|
|
|
.37
|
|
Total commercial
|
|
|
36
|
|
|
.21
|
|
|
11
|
|
|
.06
|
|
|
38
|
|
|
.23
|
|
|
35
|
|
.22
|
|
52
|
|
|
.32
|
|
Commercial mortgages
|
|
|
1
|
|
|
.01
|
|
|
2
|
|
|
.03
|
|
|
8
|
|
|
.10
|
|
|
15
|
|
.20
|
|
12
|
|
|
.16
|
|
Construction and development
|
|
|
(30
|
)
|
|
(1.58
|
)
|
|
(8
|
)
|
|
(.46
|
)
|
|
(25
|
)
|
|
(1.54
|
)
|
|
4
|
|
.26
|
|
5
|
|
|
.33
|
|
Total commercial real estate
|
|
|
(29
|
)
|
|
(.29
|
)
|
|
(6
|
)
|
|
(.06
|
)
|
|
(17
|
)
|
|
(.18
|
)
|
|
19
|
|
.21
|
|
17
|
|
|
.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgages
|
|
|
49
|
|
|
.38
|
|
|
57
|
|
|
.46
|
|
|
74
|
|
|
.63
|
|
|
92
|
|
.83
|
|
96
|
|
|
.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit card
|
|
|
163
|
|
|
3.72
|
|
|
160
|
|
|
3.75
|
|
|
173
|
|
|
4.23
|
|
|
160
|
|
3.93
|
|
161
|
|
|
3.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail leasing
|
|
|
--
|
|
|
--
|
|
|
1
|
|
|
.07
|
|
|
(1
|
)
|
|
(.07
|
)
|
|
1
|
|
.07
|
|
1
|
|
|
.07
|
|
Home equity and second mortgages
|
|
|
37
|
|
|
.95
|
|
|
43
|
|
|
1.09
|
|
|
58
|
|
|
1.45
|
|
|
73
|
|
1.80
|
|
75
|
|
|
1.76
|
|
Other
|
|
|
52
|
|
|
.79
|
|
|
54
|
|
|
.83
|
|
|
48
|
|
|
.76
|
|
|
52
|
|
.83
|
|
59
|
|
|
.92
|
|
Total other retail
|
|
|
89
|
|
|
.75
|
|
|
98
|
|
|
.83
|
|
|
105
|
|
|
.90
|
|
|
126
|
|
1.08
|
|
135
|
|
|
1.12
|
|
Total net charge-offs,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
excluding covered loans
|
|
|
308
|
|
|
.55
|
|
|
320
|
|
|
.58
|
|
|
373
|
|
|
.70
|
|
|
432
|
|
.83
|
|
461
|
|
|
.88
|
|
Covered loans
|
|
|
4
|
|
|
.18
|
|
|
8
|
|
|
.33
|
|
|
19
|
|
|
.73
|
|
|
1
|
|
.04
|
|
7
|
|
|
.24
|
|
Total net charge-offs
|
|
|
312
|
|
|
.53
|
|
|
328
|
|
|
.57
|
|
|
392
|
|
|
.70
|
|
|
433
|
|
.79
|
|
468
|
|
|
.85
|
|
Provision for credit losses
|
|
|
277
|
|
|
|
|
298
|
|
|
|
|
362
|
|
|
|
|
403
|
|
|
|
443
|
|
|
|
|
Other changes (a)
|
|
|
(6
|
)
|
|
|
|
(4
|
)
|
|
|
|
(66
|
)
|
|
|
|
5
|
|
|
|
(13
|
)
|
|
|
|
Balance, end of period
|
|
|
$4,537
|
|
|
|
|
$4,578
|
|
|
|
|
$4,612
|
|
|
|
|
$4,708
|
|
|
|
$4,733
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses
|
|
|
$4,250
|
|
|
|
|
$4,258
|
|
|
|
|
$4,312
|
|
|
|
|
$4,390
|
|
|
|
$4,424
|
|
|
|
|
Liability for unfunded
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
credit commitments
|
|
|
287
|
|
|
|
|
320
|
|
|
|
|
300
|
|
|
|
|
318
|
|
|
|
309
|
|
|
|
|
Total allowance for credit losses
|
|
|
$4,537
|
|
|
|
|
$4,578
|
|
|
|
|
$4,612
|
|
|
|
|
$4,708
|
|
|
|
$4,733
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross charge-offs
|
|
|
$429
|
|
|
|
|
$450
|
|
|
|
|
$506
|
|
|
|
|
$549
|
|
|
|
$576
|
|
|
|
|
Gross recoveries
|
|
|
$117
|
|
|
|
|
$122
|
|
|
|
|
$114
|
|
|
|
|
$116
|
|
|
|
$108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit losses as a percentage of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end loans,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
excluding covered loans
|
|
|
1.94
|
|
|
|
|
1.99
|
|
|
|
|
2.03
|
|
|
|
|
2.11
|
|
|
|
2.15
|
|
|
|
|
Nonperforming loans,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
excluding covered loans
|
|
|
297
|
|
|
|
|
294
|
|
|
|
|
287
|
|
|
|
|
274
|
|
|
|
269
|
|
|
|
|
Nonperforming assets,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
excluding covered assets
|
|
|
242
|
|
|
|
|
235
|
|
|
|
|
231
|
|
|
|
|
221
|
|
|
|
218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end loans
|
|
|
1.93
|
|
|
|
|
1.98
|
|
|
|
|
2.02
|
|
|
|
|
2.11
|
|
|
|
2.12
|
|
|
|
|
Nonperforming loans
|
|
|
283
|
|
|
|
|
276
|
|
|
|
|
269
|
|
|
|
|
255
|
|
|
|
228
|
|
|
|
|
Nonperforming assets
|
|
|
223
|
|
|
|
|
207
|
|
|
|
|
203
|
|
|
|
|
196
|
|
|
|
177
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes net changes in credit losses to be reimbursed by the
FDIC and, beginning in the second quarter of 2013, reductions in
the allowance for covered loans where the reversal of a previously
recorded allowance was offset by an associated decrease in the
indemnification asset.
|
|
(b) Annualized and calculated on average loan balances
|
|
|
Credit Quality
The allowance for credit losses was $4,537 million at December 31, 2013,
compared with $4,578 million at September 30, 2013, and $4,733 million
at December 31, 2012. Net charge-offs and nonperforming assets declined
on a linked quarter and year-over-year basis as economic conditions
continued to slowly improve. On a linked quarter basis, net charge-offs
decreased $16 million (4.9 percent), and nonperforming assets, excluding
covered assets, decreased $67 million (3.6 percent). Total net
charge-offs in the fourth quarter of 2013 were $312 million, compared
with $328 million in the third quarter of 2013, and $468 million in the
fourth quarter of 2012. The decrease in total net charge-offs on a
linked quarter basis primarily reflected improvement in the construction
and development portfolio, as well as improvement in the residential
mortgages and home equity and second mortgages portfolios. The $156
million (33.3 percent) decline in net charge-offs year-over-year was due
to improvements in the commercial, commercial real estate, residential
mortgages and home equity and second mortgages portfolios. The Company
recorded $277 million of provision for credit losses in the current
quarter, which was $35 million less than net charge-offs.
Commercial and commercial real estate loan net charge-offs were $7
million (.03 percent of average loans outstanding) in the fourth quarter
of 2013, compared with $5 million (.02 percent of average loans
outstanding) in the third quarter of 2013, and $69 million (.27 percent
of average loans outstanding) in the fourth quarter of 2012.
Residential mortgage loan net charge-offs were $49 million (.38 percent
of average loans outstanding) in the fourth quarter of 2013, compared
with $57 million (.46 percent of average loans outstanding) in the third
quarter of 2013, and $96 million (.88 percent of average loans
outstanding) in the fourth quarter of 2012. Credit card loan net
charge-offs were $163 million (3.72 percent of average loans
outstanding) in the fourth quarter of 2013, compared with $160 million
(3.75 percent of average loans outstanding) in the third quarter of
2013, and $161 million (3.86 percent of average loans outstanding) in
the fourth quarter of 2012. Total other retail loan net charge-offs were
$89 million (.75 percent of average loans outstanding) in the fourth
quarter of 2013, compared with $98 million (.83 percent of average loans
outstanding) in the third quarter of 2013, and $135 million (1.12
percent of average loans outstanding) in the fourth quarter of 2012.
The ratio of the allowance for credit losses to period-end loans was
1.93 percent (1.94 percent excluding covered loans) at December 31,
2013, compared with 1.98 percent (1.99 percent excluding covered loans)
at September 30, 2013, and 2.12 percent (2.15 percent excluding covered
loans) at December 31, 2012. The ratio of the allowance for credit
losses to nonperforming loans was 283 percent (297 percent excluding
covered loans) at December 31, 2013, compared with 276 percent (294
percent excluding covered loans) at September 30, 2013, and 228 percent
(269 percent excluding covered loans) at December 31, 2012.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELINQUENCY RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
Table 9
|
|
(Percent)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec 31
|
|
|
Sep 30
|
|
|
Jun 30
|
|
|
Mar 31
|
|
|
Dec 31
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delinquent loan ratios - 90 days or more past due excluding
nonperforming loans (a)
|
|
Commercial
|
|
|
.08
|
|
|
.07
|
|
|
.09
|
|
|
.09
|
|
|
.09
|
|
Commercial real estate
|
|
|
.07
|
|
|
.02
|
|
|
.03
|
|
|
.02
|
|
|
.02
|
|
Residential mortgages
|
|
|
.65
|
|
|
.53
|
|
|
.53
|
|
|
.54
|
|
|
.64
|
|
Credit card
|
|
|
1.17
|
|
|
1.11
|
|
|
1.10
|
|
|
1.26
|
|
|
1.27
|
|
Other retail
|
|
|
.18
|
|
|
.16
|
|
|
.16
|
|
|
.18
|
|
|
.20
|
|
Total loans, excluding covered loans
|
|
|
.31
|
|
|
.27
|
|
|
.27
|
|
|
.29
|
|
|
.31
|
|
Covered loans
|
|
|
5.63
|
|
|
5.47
|
|
|
5.40
|
|
|
5.18
|
|
|
5.86
|
|
Total loans
|
|
|
.51
|
|
|
.48
|
|
|
.49
|
|
|
.52
|
|
|
.59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delinquent loan ratios - 90 days or more past due including
nonperforming loans (a)
|
|
Commercial
|
|
|
.27
|
|
|
.24
|
|
|
.24
|
|
|
.25
|
|
|
.27
|
|
Commercial real estate
|
|
|
.83
|
|
|
.94
|
|
|
1.13
|
|
|
1.38
|
|
|
1.50
|
|
Residential mortgages
|
|
|
2.16
|
|
|
1.99
|
|
|
1.96
|
|
|
2.01
|
|
|
2.14
|
|
Credit card
|
|
|
1.60
|
|
|
1.66
|
|
|
1.75
|
|
|
2.04
|
|
|
2.12
|
|
Other retail
|
|
|
.58
|
|
|
.60
|
|
|
.63
|
|
|
.67
|
|
|
.66
|
|
Total loans, excluding covered loans
|
|
|
.97
|
|
|
.94
|
|
|
.97
|
|
|
1.06
|
|
|
1.11
|
|
Covered loans
|
|
|
7.13
|
|
|
7.13
|
|
|
7.08
|
|
|
7.13
|
|
|
9.28
|
|
Total loans
|
|
|
1.19
|
|
|
1.20
|
|
|
1.24
|
|
|
1.35
|
|
|
1.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Ratios are expressed as a percent of ending loan balances.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
Table 10
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec 31
|
|
|
Sep 30
|
|
|
Jun 30
|
|
|
Mar 31
|
|
|
Dec 31
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
Nonperforming loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
|
$122
|
|
|
$104
|
|
|
$91
|
|
|
$85
|
|
|
$107
|
|
Lease financing
|
|
|
12
|
|
|
12
|
|
|
14
|
|
|
16
|
|
|
16
|
|
Total commercial
|
|
|
134
|
|
|
116
|
|
|
105
|
|
|
101
|
|
|
123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial mortgages
|
|
|
182
|
|
|
210
|
|
|
263
|
|
|
289
|
|
|
308
|
|
Construction and development
|
|
|
121
|
|
|
146
|
|
|
161
|
|
|
218
|
|
|
238
|
|
Total commercial real estate
|
|
|
303
|
|
|
356
|
|
|
424
|
|
|
507
|
|
|
546
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential mortgages
|
|
|
770
|
|
|
732
|
|
|
685
|
|
|
673
|
|
|
661
|
|
Credit card
|
|
|
78
|
|
|
94
|
|
|
109
|
|
|
127
|
|
|
146
|
|
Other retail
|
|
|
191
|
|
|
206
|
|
|
222
|
|
|
228
|
|
|
217
|
|
Total nonperforming loans, excluding covered loans
|
|
|
1,476
|
|
|
1,504
|
|
|
1,545
|
|
|
1,636
|
|
|
1,693
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Covered loans
|
|
|
127
|
|
|
156
|
|
|
168
|
|
|
209
|
|
|
386
|
|
Total nonperforming loans
|
|
|
1,603
|
|
|
1,660
|
|
|
1,713
|
|
|
1,845
|
|
|
2,079
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other real estate (a)
|
|
|
327
|
|
|
366
|
|
|
364
|
|
|
379
|
|
|
381
|
|
Covered other real estate (a)
|
|
|
97
|
|
|
176
|
|
|
187
|
|
|
168
|
|
|
197
|
|
Other nonperforming assets
|
|
|
10
|
|
|
10
|
|
|
12
|
|
|
14
|
|
|
14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming assets (b)
|
|
|
$2,037
|
|
|
$2,212
|
|
|
$2,276
|
|
|
$2,406
|
|
|
$2,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming assets, excluding covered assets
|
|
|
$1,813
|
|
|
$1,880
|
|
|
$1,921
|
|
|
$2,029
|
|
|
$2,088
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accruing loans 90 days or more past due, excluding covered loans
|
|
|
$713
|
|
|
$591
|
|
|
$580
|
|
|
$609
|
|
|
$660
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accruing loans 90 days or more past due
|
|
|
$1,189
|
|
|
$1,105
|
|
|
$1,119
|
|
|
$1,165
|
|
|
$1,323
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing restructured loans, excluding GNMA and covered loans
|
|
|
$3,067
|
|
|
$3,097
|
|
|
$3,311
|
|
|
$3,318
|
|
|
$3,421
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing restructured GNMA and covered loans
|
|
|
$2,932
|
|
|
$2,262
|
|
|
$2,217
|
|
|
$2,294
|
|
|
$2,159
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming assets to loans plus ORE, excluding covered assets
(%)
|
|
|
.80
|
|
|
.85
|
|
|
.88
|
|
|
.95
|
|
|
.98
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming assets to loans plus ORE (%)
|
|
|
.86
|
|
|
.95
|
|
|
1.00
|
|
|
1.07
|
|
|
1.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes equity investments in entities whose principal assets
are other real estate owned.
|
|
(b) Does not include accruing loans 90 days or more past due.
|
|
|
Nonperforming assets at December 31, 2013, totaled $2,037 million,
compared with $2,212 million at September 30, 2013, and $2,671 million
at December 31, 2012. Total nonperforming assets at December 31, 2013,
included $224 million of covered assets. The ratio of nonperforming
assets to loans and other real estate was .86 percent (.80 percent
excluding covered assets) at December 31, 2013, compared with .95
percent (.85 percent excluding covered assets) at September 30, 2013,
and 1.19 percent (.98 percent excluding covered assets) at December 31,
2012. Total commercial nonperforming assets were $18 million (15.5
percent) higher on a linked quarter basis and $11 million (8.9 percent)
higher year-over-year. Commercial real estate nonperforming assets
declined by $53 million (14.9 percent) on a linked quarter basis and
$243 million (44.5 percent) year-over-year. Residential mortgage
nonperforming assets increased $38 million (5.2 percent) on a linked
quarter basis and $109 million (16.5 percent) year-over-year. Credit
card nonperforming assets were $16 million (17.0 percent) lower on a
linked basis and $68 million (46.6 percent) lower year-over-year. Other
retail nonperforming assets decreased $15 million (7.3 percent) on a
linked quarter basis and $26 million (12.0 percent) year-over-year.
Accruing loans 90 days or more past due were $1,189 million ($713
million excluding covered loans) at December 31, 2013, compared with the
$1,105 million ($591 million excluding covered loans) at September 30,
2013, and the $1,323 million ($660 million excluding covered loans) at
December 31, 2012.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL POSITION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 11
|
|
|
($ in millions)
|
|
|
Dec 31
|
|
|
|
Sep 30
|
|
|
|
Jun 30
|
|
|
|
Mar 31
|
|
|
|
Dec 31
|
|
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total U.S. Bancorp shareholders' equity
|
|
|
$41,113
|
|
|
|
$40,132
|
|
|
|
$39,683
|
|
|
|
$39,531
|
|
|
|
$38,998
|
|
|
Tier 1 capital
|
|
|
33,386
|
|
|
|
32,707
|
|
|
|
32,219
|
|
|
|
31,774
|
|
|
|
31,203
|
|
|
Total risk-based capital
|
|
|
39,340
|
|
|
|
38,873
|
|
|
|
38,378
|
|
|
|
38,099
|
|
|
|
37,780
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 capital ratio
|
|
|
11.2
|
%
|
|
|
11.2
|
%
|
|
|
11.1
|
%
|
|
|
11.0
|
%
|
|
|
10.8
|
%
|
|
Total risk-based capital ratio
|
|
|
13.2
|
|
|
|
13.3
|
|
|
|
13.3
|
|
|
|
13.2
|
|
|
|
13.1
|
|
|
Leverage ratio
|
|
|
9.6
|
|
|
|
9.6
|
|
|
|
9.5
|
|
|
|
9.3
|
|
|
|
9.2
|
|
|
Tangible common equity to tangible assets
|
|
|
7.7
|
|
|
|
7.4
|
|
|
|
7.5
|
|
|
|
7.4
|
|
|
|
7.2
|
|
|
Tangible common equity to risk-weighted assets using Basel I
definition
|
|
|
9.1
|
|
|
|
8.9
|
|
|
|
8.9
|
|
|
|
8.8
|
|
|
|
8.6
|
|
|
Tier 1 common equity to risk-weighted assets using Basel I
definition
|
|
|
9.4
|
|
|
|
9.3
|
|
|
|
9.2
|
|
|
|
9.1
|
|
|
|
9.0
|
|
|
Common equity tier 1 to risk-weighted assets estimated using final
rules for the Basel III standardized approach
|
|
|
8.8
|
|
|
|
8.6
|
|
|
|
8.6
|
|
|
|
--
|
|
|
|
--
|
|
|
Common equity tier 1 to risk-weighted assets approximated using
proposed rules for the Basel III standardized approach released
June 2012
|
|
|
--
|
|
|
|
--
|
|
|
|
8.3
|
|
|
|
8.2
|
|
|
|
8.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total U.S. Bancorp shareholders’ equity was $41.1 billion at December
31, 2013, compared with $40.1 billion at September 30, 2013, and $39.0
billion at December 31, 2012. During the fourth quarter, the Company
returned 65 percent of fourth quarter earnings to shareholders,
including $420 million in common stock dividends and $493 million of
repurchased common stock. The tier 1 capital ratio was 11.2 percent at
both December 31, 2013, and at September 30, 2013, compared with 10.8
percent at December 31, 2012. The tangible common equity to tangible
assets ratio was 7.7 percent at December 31, 2013, compared with 7.4
percent at September 30, 2013, and 7.2 percent at December 31, 2012. The
tier 1 common equity to risk-weighted assets ratio was 9.4 percent at
December 31, 2013, compared with 9.3 percent at September 30, 2013, and
9.0 percent at December 31, 2012. All regulatory ratios continue to be
in excess of “well-capitalized” requirements. The common equity tier 1
to risk-weighted assets ratio estimated using final rules for the Basel
III standardized approach was 8.8 percent at December 31, 2013, and 8.6
percent at both September 30, 2013, and at June 30, 2013.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMON SHARES
|
|
|
|
|
|
|
|
|
|
|
|
Table 12
|
|
(Millions)
|
|
|
4Q
|
|
|
3Q
|
|
|
2Q
|
|
|
1Q
|
|
|
4Q
|
|
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning shares outstanding
|
|
|
1,832
|
|
|
|
1,844
|
|
|
|
1,858
|
|
|
|
1,869
|
|
|
|
1,880
|
|
|
Shares issued for stock option and stock purchase plans,
acquisitions and other corporate purposes
|
|
|
6
|
|
|
|
5
|
|
|
|
4
|
|
|
|
6
|
|
|
|
2
|
|
|
Shares repurchased
|
|
|
(13
|
)
|
|
|
(17
|
)
|
|
|
(18
|
)
|
|
|
(17
|
)
|
|
|
(13
|
)
|
|
Ending shares outstanding
|
|
|
1,825
|
|
|
|
1,832
|
|
|
|
1,844
|
|
|
|
1,858
|
|
|
|
1,869
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LINE OF BUSINESS FINANCIAL PERFORMANCE (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 13
|
|
|
($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable
|
|
|
|
|
|
|
|
|
Net Income Attributable
|
|
|
|
|
|
|
|
|
|
|
|
to U.S. Bancorp
|
|
|
Percent Change
|
|
|
to U.S. Bancorp
|
|
|
|
|
|
4Q 2013
|
|
|
|
|
|
4Q
|
|
|
3Q
|
|
|
4Q
|
|
|
4Q13 vs
|
|
|
4Q13 vs
|
|
|
Full Year
|
|
|
Full Year
|
|
|
Percent
|
|
|
Earnings
|
|
|
Business Line
|
|
|
2013
|
|
|
2013
|
|
|
2012
|
|
|
3Q13
|
|
|
4Q12
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
Composition
|
|
|
Wholesale Banking and Commercial Real Estate
|
|
|
$298
|
|
|
$330
|
|
|
$322
|
|
|
(9.7
|
)
|
|
|
(7.5
|
)
|
|
|
$1,285
|
|
|
$1,307
|
|
|
(1.7
|
)
|
|
|
20
|
%
|
|
Consumer and Small Business Banking
|
|
|
353
|
|
|
338
|
|
|
278
|
|
|
4.4
|
|
|
|
27.0
|
|
|
|
1,353
|
|
|
1,374
|
|
|
(1.5
|
)
|
|
|
24
|
|
|
Wealth Management and Securities Services
|
|
|
42
|
|
|
33
|
|
|
41
|
|
|
27.3
|
|
|
|
2.4
|
|
|
|
156
|
|
|
171
|
|
|
(8.8
|
)
|
|
|
3
|
|
|
Payment Services
|
|
|
285
|
|
|
318
|
|
|
318
|
|
|
(10.4
|
)
|
|
|
(10.4
|
)
|
|
|
1,181
|
|
|
1,265
|
|
|
(6.6
|
)
|
|
|
20
|
|
|
Treasury and Corporate Support
|
|
|
478
|
|
|
449
|
|
|
461
|
|
|
6.5
|
|
|
|
3.7
|
|
|
|
1,861
|
|
|
1,530
|
|
|
21.6
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Company
|
|
|
$1,456
|
|
|
$1,468
|
|
|
$1,420
|
|
|
(.8
|
)
|
|
|
2.5
|
|
|
|
$5,836
|
|
|
$5,647
|
|
|
3.3
|
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) preliminary data
|
|
|
Lines of Business
The Company’s major lines of business are Wholesale Banking and
Commercial Real Estate, Consumer and Small Business Banking, Wealth
Management and Securities Services, Payment Services, and Treasury and
Corporate Support. These operating segments are components of the
Company about which financial information is prepared and is evaluated
regularly by management in deciding how to allocate resources and assess
performance. Noninterest expenses incurred by centrally managed
operations or business lines that directly support another business
line’s operations are charged to the applicable business line based on
its utilization of those services, primarily measured by the volume of
customer activities, number of employees or other relevant factors.
These allocated expenses are reported as net shared services expense
within noninterest expense. Designations, assignments and allocations
change from time to time as management systems are enhanced, methods of
evaluating performance or product lines change or business segments are
realigned to better respond to the Company’s diverse customer base.
During 2013, certain organization and methodology changes were made and,
accordingly, prior period results were restated and presented on a
comparable basis.
Wholesale Banking and Commercial Real Estate offers lending,
equipment finance and small-ticket leasing, depository services,
treasury management, capital markets, international trade services and
other financial services to middle market, large corporate, commercial
real estate, financial institution, non-profit and public sector
clients. Wholesale Banking and Commercial Real Estate contributed $298
million of the Company’s net income in the fourth quarter of 2013,
compared with $322 million in the fourth quarter of 2012 and $330
million in the third quarter of 2013. Wholesale Banking and Commercial
Real Estate’s net income decreased $24 million (7.5 percent) from the
same quarter of 2012 due to a higher provision for credit losses and a
decrease in total net revenue, partially offset by a reduction in total
noninterest expense. Total net revenue declined by $19 million (2.3
percent), as a 9.9 percent decrease in total noninterest income was
partially offset by a 2.1 percent increase in net interest income. Net
interest income increased $11 million (2.1 percent) year-over-year,
primarily due to higher average loan and deposit balances, partially
offset by lower rates on loans and the impact of lower rates on the
margin benefit from deposits. Total noninterest income decreased by $30
million (9.9 percent), driven by lower commercial products revenue,
including standby letters of credit fees, foreign exchange revenue and
other loan-related fees. In addition, equity investment revenue was
lower year-over-year. Total noninterest expense decreased by $6 million
(1.9 percent) from a year ago, primarily due to lower costs related to
other real estate owned and commercial leasing, as well as a decrease in
other intangibles expense. The provision for credit losses was $24
million higher year-over-year due to an unfavorable change in the
reserve allocation, driven by higher portfolio volume, partially offset
by lower net charge-offs.
Wholesale Banking and Commercial Real Estate’s contribution to net
income in the fourth quarter of 2013 was $32 million (9.7 percent) lower
than the third quarter of 2013, mainly due to an increase in the
provision for credit losses. Total net revenue increased by $12 million
(1.5 percent) over the prior quarter. Net interest income increased by
$5 million (1.0 percent) on a linked quarter basis, primarily due to
increases in average loan and deposit balances, partially offset by
lower loan rates and the impact of lower rates on the margin benefit
from deposits. Total noninterest income increased by $7 million (2.6
percent), driven by higher commercial products revenue, including an
increase in commercial leasing and capital markets revenue, partially
offset by lower treasury management fees due to seasonally higher
volumes in the prior quarter. Total noninterest expense was relatively
flat, increasing $1 million (.3 percent), as higher marketing and
business development expense was offset by lower net shared services
costs. The provision for credit losses increased by $61 million due to
higher net charge-offs and an unfavorable change in the reserve
allocation.
Consumer and Small Business Banking delivers products and
services through banking offices, telephone servicing and sales, on-line
services, direct mail, ATM processing and over mobile devices, such as
mobile phones and tablet computers. It encompasses community banking,
metropolitan banking, in-store banking, small business banking, consumer
lending, mortgage banking, workplace banking, student banking and
24-hour banking. Consumer and Small Business Banking contributed $353
million of the Company’s net income in the fourth quarter of 2013, a $75
million (27.0 percent) increase over the fourth quarter of 2012 and a
$15 million (4.4 percent) increase over the prior quarter. Within
Consumer and Small Business Banking, the retail banking division
reported a $166 million increase in its contribution over the same
quarter of last year, principally due to a reduction in the provision
for credit losses. Retail banking’s total net revenue was 1.0 percent
lower than the fourth quarter of 2012. Net interest income decreased 2.0
percent, primarily due to the impact of lower rates on the margin
benefit from deposits, partially offset by higher average loan and
deposit balances and loan fees. Total noninterest income for the retail
banking division increased 1.5 percent over a year ago, principally due
to higher deposit service charges, the result of pricing changes and
increased monthly account fees and account growth, and retail lease
revenue, partially offset by a decrease in ATM processing services
revenue due to lower volumes. Total noninterest expense for the retail
banking division in the fourth quarter of 2013 decreased .5 percent from
the same quarter of the prior year, largely due to reductions in FDIC
insurance expense, other intangibles expense, technology and
communications expense and costs associated with other real estate
owned, partially offset by higher net shared services expense. The
provision for credit losses for the retail banking division decreased
$272 million on a year-over-year basis due to a favorable change in the
reserve allocation related to home equity loans and lower net
charge-offs. The contribution of the mortgage banking division was lower
by 49.7 percent than the fourth quarter of 2012, reflecting a decrease
in total net revenue, partially offset by a reduction in total
noninterest expense. The division’s 42.4 percent decrease in total net
revenue was due to a 51.7 percent decrease in total noninterest income,
driven by lower mortgage origination and sales revenue, as well as an
18.8 percent decrease in net interest income, primarily the result of
lower average loans held for sale. Total noninterest expense was 42.2
percent lower than the prior year, reflecting a reduction in mortgage
servicing review-related professional services costs and lower
compensation costs. The provision for credit losses for the mortgage
banking division increased by $12 million (48.0 percent) due to an
unfavorable change in the reserve allocation, partially offset by lower
net charge-offs.
Consumer and Small Business Banking’s contribution in the fourth quarter
of 2013 was $15 million (4.4 percent) higher than the third quarter of
2013, driven by a lower provision for credit losses, partially offset by
a decrease in total net revenue. Within Consumer and Small Business
Banking, the retail banking division’s contribution increased 40.3
percent, mainly due to a decrease in the provision for credit losses.
Total net revenue for the retail banking division increased .4 percent
over the previous quarter. Net interest income was flat, as increases in
average loan and deposits balances were offset by the impact of lower
rates on the margin benefit from deposits. Total noninterest income was
1.5 percent higher on a linked quarter basis, driven by higher retail
lease revenue. Total noninterest expense for the retail banking division
was .8 percent higher on a linked quarter basis, as increases in
compensation, marketing and net occupancy and equipment expense were
partially offset by lower net shared services expense. The provision for
credit losses decreased $120 million on a linked quarter basis due to a
favorable change in the reserve allocation and lower net charge-offs.
The contribution of the mortgage banking division decreased 39.5 percent
from the third quarter of 2013 due to lower total net revenue, partially
offset by a decline in total noninterest expense and a lower provision
for credit losses. Total net revenue decreased 22.7 percent due to an
8.5 percent decline in net interest income, the result of lower average
loans held for sale, and a 29.9 percent decrease in total noninterest
income, primarily due to a reduction in mortgage banking revenue, the
result of an unfavorable change in the valuation of MSRs, net of hedging
activities, and lower origination and sales revenue. Total noninterest
expense decreased 2.5 percent, reflecting lower compensation, employee
benefits and net shared services costs, partially offset by higher
professional services expense. The mortgage banking division’s provision
for credit losses decreased $11 million (22.9 percent) on a linked
quarter basis, due to lower net charge-offs and a favorable change in
the reserve allocation.
Wealth Management and Securities Services provides private
banking, financial advisory services, investment management, retail
brokerage services, insurance, trust, custody and fund servicing through
five businesses: Wealth Management, Corporate Trust Services, U.S.
Bancorp Asset Management, Institutional Trust & Custody and Fund
Services. Wealth Management and Securities Services contributed $42
million of the Company’s net income in the fourth quarter of 2013,
compared with $41 million in the fourth quarter of 2012 and $33 million
in the third quarter of 2013. The business line’s contribution was $1
million (2.4 percent) higher than the same quarter of 2012, as an
increase in total net revenue and a lower provision for credit losses
were offset by higher total noninterest expense. Total net revenue
increased by $28 million (7.3 percent) year-over-year, driven by a $30
million (10.2 percent) increase in total noninterest income, reflecting
the impact of improved market conditions, business expansion and higher
investment products fees. Net interest income decreased $2 million (2.2
percent), principally due to the impact of lower rates on the margin
benefit from deposits, partially offset by higher average loan and
deposit balances. Total noninterest expense increased by $36 million
(11.5 percent) as a result of higher compensation and employee benefits
expense and an increase in net shared services costs, including the
impact of business expansion. The provision for credit losses decreased
$10 million from the prior year due to lower net charge-offs and a
favorable change in the reserve allocation.
The business line’s contribution in the fourth quarter of 2013 was $9
million (27.3 percent) higher than the prior quarter. Total net revenue
increased by $23 million (5.9 percent) on a linked quarter basis,
reflecting an increase in net interest income (4.7 percent), principally
due to higher average deposit balances, and an increase in total
noninterest income (6.2 percent), reflecting higher trust and investment
management fees, mainly due to improved market conditions and account
growth, including business expansion. Total noninterest expense
increased $16 million (4.8 percent), primarily as a result of higher
compensation expense and professional services costs. The provision for
credit losses decreased $7 million on a linked quarter basis due to a
favorable change in the reserve allocation and lower net charge-offs.
Payment Services includes consumer and business credit cards,
stored-value cards, debit cards, corporate and purchasing card services,
consumer lines of credit and merchant processing. Payment Services
contributed $285 million of the Company’s net income in the fourth
quarter of 2013, compared with $318 million in both the fourth quarter
of 2012 and third quarter of 2013. The $33 million (10.4 percent)
reduction in the business line’s contribution from the prior year was
driven by increases in the provision for credit losses and total
noninterest expense, partially off by an increase in total net revenue.
Total net revenue increased by $37 million (3.1 percent) year-over-year.
Net interest income increased by $22 million (5.6 percent), primarily
due to higher average loan balances, improved loan rates and lower
rebate costs on the Company’s government card program. Total noninterest
income was $15 million (1.9 percent) higher year-over-year, reflecting
higher credit and debit card revenue on higher transaction volumes,
including the impact of business expansion, and merchant processing
services revenue, the result of an increase in product fees and higher
volumes, partially offset by a decrease in corporate payment products
revenue, due to lower government-related transactions. Total noninterest
expense increased by $18 million (3.4 percent) over the fourth quarter
of 2012, primarily due to higher compensation, employee benefits and net
shared services expense, including the impact of business expansion,
partially offset by reductions in technology and communications expense,
marketing costs and other intangibles expense. The provision for credit
losses increased by $67 million (45.0 percent) due to an unfavorable
change in the reserve allocation.
Payment Services’ contribution in the fourth quarter of 2013 declined
$33 million (10.4 percent), from the third quarter of 2013. Total net
revenue increased $9 million (.7 percent) on a linked quarter basis. Net
interest income increased by $23 million (5.9 percent) due to higher
average loan balances and seasonally lower rebate costs on the Company’s
government card program. Total noninterest income declined by $14
million (1.7 percent), reflecting lower corporate payment products
revenue due to seasonally lower government-related transaction volumes,
partially offset by an increase in credit and debit card revenue due to
higher volumes. Total noninterest expense increased by $16 million (3.0
percent) due to higher compensation expense, as well as the timing of
marketing programs and professional services costs, partially offset by
lower outside data processing expense. The provision for credit losses
was $44 million (25.6 percent) higher on a linked quarter basis due to
an unfavorable change in the reserve allocation and an increase in net
charge-offs.
Treasury and Corporate Support includes the Company’s investment
portfolios, most covered commercial and commercial real estate loans and
related other real estate owned, funding, capital management, interest
rate risk management, the net effect of transfer pricing related to
average balances, income taxes not allocated to business lines,
including most tax advantaged investments and the residual aggregate of
those expenses associated with corporate activities that are managed on
a consolidated basis. Treasury and Corporate Support recorded net income
of $478 million in the fourth quarter of 2013, compared with net income
of $461 million in the fourth quarter of 2012 and net income of $449
million in the third quarter of 2013. Net interest income decreased by
$26 million (4.4 percent) from the fourth quarter of 2012, principally
due to lower rates on loans and investment securities, partially offset
by lower funding costs. Total noninterest income increased by $49
million (67.1 percent) over the fourth quarter of last year, driven by
higher equity investment and commercial products revenue, including an
increase in syndication fees on tax-advantaged projects. Total
noninterest expense increased by $97 million (46.4 percent), principally
reflecting an increase in compensation and employee benefits expense and
costs related to investments in tax-advantaged projects, partially
offset by lower net shared services costs and other real estate
owned-related expense. The provision for credit losses was $13 million
higher year-over-year, due to an unfavorable change in the reserve
allocation, partially offset by a decrease in net charge-offs.
Net income in the fourth quarter of 2013 was $29 million (6.5 percent)
higher on a linked quarter basis, reflecting higher total net revenue,
partially offset by an increase in the provision for credit losses.
Total net revenue was $59 million (9.3 percent) higher than the prior
quarter, driven by higher equity investment and commercial products
revenue, mainly due to an increase in syndication fees on tax-advantaged
projects. An $81 million (36.0 percent) increase in total noninterest
expense primarily reflected higher costs related to investments in
tax-advantaged projects and an increase in net shared services expense.
The provision for credit losses was $12 million higher compared with the
third quarter of 2013, due to an unfavorable change in the reserve
allocation, partially offset by a decrease in net charge-offs.
Additional schedules containing more detailed information about the
Company’s business line results are available on the web at usbank.com
or by calling Investor Relations at 612-303-0781.
On Wednesday, January 22, 2014, at 8:00 a.m. (CST)Richard K. Davis,
chairman, president and chief executive officer, and Andrew Cecere, vice
chairman and chief financial officer, will host a conference call to
review the financial results. The conference call will be
available by telephone or on the Internet. A presentation will be
used during the call and will be available on the Company’s website at www.usbank.com.
To access the conference call from locations within the United States
and Canada, please dial 866-316-1409. Participants calling from
outside the United States and Canada, please dial 706-634-9086. The
conference ID number for all participants is 13771672. For those
unable to participate during the live call, a recording of the call will
be available approximately two hours after the conference call ends on
Wednesday, January 22nd, and will run through Wednesday, January 29th,
at 11:00 p.m. (CST). To access the recorded message within the
United States and Canada, dial 855-859-2056. If calling from
outside the United States and Canada, please dial 404-537-3406 to access
the recording. The conference ID is 13771672. To access
the webcast and presentation go to www.usbank.com
and click on “About U.S. Bank.” The “Webcasts & Presentations”
link can be found under the Investor/Shareholder information heading,
which is at the left side of the bottom of the page.
Minneapolis-based U.S. Bancorp (“USB”), with $364 billion in assets as
of December 31, 2013, is the parent company of U.S. Bank National
Association, the 5th largest commercial bank in the United States. The
Company operates 3,081 banking offices in 25 states and 4,906 ATMs and
provides a comprehensive line of banking, brokerage, insurance,
investment, mortgage, trust and payment services products to consumers,
businesses and institutions. Visit U.S. Bancorp on the web at usbank.com.
Forward-Looking Statements
The following information appears in accordance with the Private
Securities Litigation Reform Act of 1995:
This press release contains forward-looking statements about U.S.
Bancorp. Statements that are not historical or current facts, including
statements about beliefs and expectations, are forward-looking
statements and are based on the information available to, and
assumptions and estimates made by, management as of the date hereof.
These forward-looking statements cover, among other things, anticipated
future revenue and expenses and the future plans and prospects of U.S.
Bancorp. Forward-looking statements involve inherent risks and
uncertainties, and important factors could cause actual results to
differ materially from those anticipated. Global and domestic economies
could fail to recover from the recent economic downturn or could
experience another severe contraction, which could adversely affect U.S.
Bancorp’s revenues and the values of its assets and liabilities. Global
financial markets could experience a recurrence of significant
turbulence, which could reduce the availability of funding to certain
financial institutions and lead to a tightening of credit, a reduction
of business activity, and increased market volatility. Continued stress
in the commercial real estate markets, as well as a delay or failure of
recovery in the residential real estate markets could cause additional
credit losses and deterioration in asset values. In addition, U.S.
Bancorp’s business and financial performance is likely to be negatively
impacted by recently enacted and future legislation and regulation. U.S.
Bancorp’s results could also be adversely affected by deterioration in
general business and economic conditions; changes in interest rates;
deterioration in the credit quality of its loan portfolios or in the
value of the collateral securing those loans; deterioration in the value
of securities held in its investment securities portfolio; legal and
regulatory developments; increased competition from both banks and
non-banks; changes in customer behavior and preferences; effects of
mergers and acquisitions and related integration; effects of critical
accounting policies and judgments; and management’s ability to
effectively manage credit risk, residual value risk, market risk,
operational risk, interest rate risk and liquidity risk.
For discussion of these and other risks that may cause actual results to
differ from expectations, refer to U.S. Bancorp’s Annual Report on Form
10-K for the year ended December 31, 2012, on file with the Securities
and Exchange Commission, including the sections entitled “Risk Factors”
and “Corporate Risk Profile” contained in Exhibit 13, and all subsequent
filings with the Securities and Exchange Commission under Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934.
However, factors other than these also could adversely affect U.S.
Bancorp’s results, and the reader should not consider these factors to
be a complete set of all potential risks or uncertainties.
Forward-looking statements speak only as of the date hereof, and U.S.
Bancorp undertakes no obligation to update them in light of new
information or future events.
Non-GAAP Financial Measures
In addition to capital ratios defined by banking regulators under the
FDIC Improvement Act prompt corrective action provisions that are
currently effective, the Company considers various other measures when
evaluating capital utilization and adequacy, including:
-
Tangible common equity to tangible assets,
-
Tangible common equity to risk-weighted assets using Basel I
definition,
-
Tier 1 common equity to risk-weighted assets using Basel I definition,
-
Common equity tier 1 to risk-weighted assets estimated using final
rules for the Basel III standardized approach, and for additional
information
-
Common equity tier 1 to risk-weighted assets approximated using
proposed rules for the Basel III standardized approach released June
2012.
These measures are viewed by management as useful additional methods of
reflecting the level of capital available to withstand unexpected market
or economic conditions. Additionally, presentation of these measures
allows investors, analysts and banking regulators to assess the
Company’s capital position relative to other financial services
companies. These measures differ from the currently effective capital
ratios defined by banking regulations principally in that the numerator
excludes trust preferred securities and preferred stock, the nature and
extent of which varies among different financial services companies.
These measures are not defined in generally accepted accounting
principles (“GAAP”) or are not currently effective or defined in federal
banking regulations. As a result, these measures disclosed by the
Company may be considered non-GAAP financial measures.
There may be limits in the usefulness of these measures to investors. As
a result, the Company encourages readers to consider the consolidated
financial statements and other financial information contained in this
press release in their entirety, and not to rely on any single financial
measure. A table follows that shows the Company’s calculation of these
non-GAAP financial measures.
|
|
|
U.S. Bancorp
|
|
Consolidated Statement of Income
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Year Ended
|
|
(Dollars and Shares in Millions, Except Per Share Data)
|
|
|
December 31,
|
|
|
December 31,
|
|
(Unaudited)
|
|
|
2013
|
|
|
|
2012
|
|
|
2013
|
|
|
2012
|
|
|
Interest Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
|
|
|
$2,595
|
|
|
|
$2,639
|
|
|
$10,277
|
|
|
$10,558
|
|
|
Loans held for sale
|
|
|
31
|
|
|
|
74
|
|
|
203
|
|
|
282
|
|
|
Investment securities
|
|
|
409
|
|
|
|
416
|
|
|
1,631
|
|
|
1,792
|
|
|
Other interest income
|
|
|
33
|
|
|
|
67
|
|
|
174
|
|
|
251
|
|
|
Total interest income
|
|
|
3,068
|
|
|
|
3,196
|
|
|
12,285
|
|
|
12,883
|
|
|
Interest Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
128
|
|
|
|
161
|
|
|
561
|
|
|
691
|
|
|
Short-term borrowings
|
|
|
83
|
|
|
|
89
|
|
|
353
|
|
|
442
|
|
|
Long-term debt
|
|
|
180
|
|
|
|
219
|
|
|
767
|
|
|
1,005
|
|
|
Total interest expense
|
|
|
391
|
|
|
|
469
|
|
|
1,681
|
|
|
2,138
|
|
|
Net interest income
|
|
|
2,677
|
|
|
|
2,727
|
|
|
10,604
|
|
|
10,745
|
|
|
Provision for credit losses
|
|
|
277
|
|
|
|
443
|
|
|
1,340
|
|
|
1,882
|
|
|
Net interest income after provision for credit losses
|
|
|
2,400
|
|
|
|
2,284
|
|
|
9,264
|
|
|
8,863
|
|
|
Noninterest Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit and debit card revenue
|
|
|
263
|
|
|
|
242
|
|
|
965
|
|
|
892
|
|
|
Corporate payment products revenue
|
|
|
166
|
|
|
|
178
|
|
|
706
|
|
|
744
|
|
|
Merchant processing services
|
|
|
367
|
|
|
|
354
|
|
|
1,458
|
|
|
1,395
|
|
|
ATM processing services
|
|
|
79
|
|
|
|
83
|
|
|
327
|
|
|
346
|
|
|
Trust and investment management fees
|
|
|
297
|
|
|
|
276
|
|
|
1,139
|
|
|
1,055
|
|
|
Deposit service charges
|
|
|
177
|
|
|
|
170
|
|
|
670
|
|
|
653
|
|
|
Treasury management fees
|
|
|
130
|
|
|
|
130
|
|
|
538
|
|
|
541
|
|
|
Commercial products revenue
|
|
|
243
|
|
|
|
226
|
|
|
859
|
|
|
878
|
|
|
Mortgage banking revenue
|
|
|
231
|
|
|
|
476
|
|
|
1,356
|
|
|
1,937
|
|
|
Investment products fees
|
|
|
45
|
|
|
|
39
|
|
|
178
|
|
|
150
|
|
|
Securities gains (losses), net
|
|
|
1
|
|
|
|
3
|
|
|
9
|
|
|
(15
|
)
|
|
Other
|
|
|
157
|
|
|
|
152
|
|
|
569
|
|
|
743
|
|
|
Total noninterest income
|
|
|
2,156
|
|
|
|
2,329
|
|
|
8,774
|
|
|
9,319
|
|
|
Noninterest Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
|
|
|
1,103
|
|
|
|
1,083
|
|
|
4,371
|
|
|
4,320
|
|
|
Employee benefits
|
|
|
275
|
|
|
|
231
|
|
|
1,140
|
|
|
945
|
|
|
Net occupancy and equipment
|
|
|
240
|
|
|
|
234
|
|
|
949
|
|
|
917
|
|
|
Professional services
|
|
|
118
|
|
|
|
166
|
|
|
381
|
|
|
530
|
|
|
Marketing and business development
|
|
|
103
|
|
|
|
103
|
|
|
357
|
|
|
388
|
|
|
Technology and communications
|
|
|
209
|
|
|
|
214
|
|
|
848
|
|
|
821
|
|
|
Postage, printing and supplies
|
|
|
80
|
|
|
|
78
|
|
|
310
|
|
|
304
|
|
|
Other intangibles
|
|
|
56
|
|
|
|
66
|
|
|
223
|
|
|
274
|
|
|
Other
|
|
|
498
|
|
|
|
511
|
|
|
1,695
|
|
|
1,957
|
|
|
Total noninterest expense
|
|
|
2,682
|
|
|
|
2,686
|
|
|
10,274
|
|
|
10,456
|
|
|
Income before income taxes
|
|
|
1,874
|
|
|
|
1,927
|
|
|
7,764
|
|
|
7,726
|
|
|
Applicable income taxes
|
|
|
403
|
|
|
|
552
|
|
|
2,032
|
|
|
2,236
|
|
|
Net income
|
|
|
1,471
|
|
|
|
1,375
|
|
|
5,732
|
|
|
5,490
|
|
|
Net (income) loss attributable to noncontrolling interests
|
|
|
(15
|
)
|
|
|
45
|
|
|
104
|
|
|
157
|
|
|
Net income attributable to U.S. Bancorp
|
|
|
$1,456
|
|
|
|
$1,420
|
|
|
$5,836
|
|
|
$5,647
|
|
|
Net income applicable to U.S. Bancorp common shareholders
|
|
|
$1,389
|
|
|
|
$1,349
|
|
|
$5,552
|
|
|
$5,383
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share
|
|
|
$.76
|
|
|
|
$.72
|
|
|
$3.02
|
|
|
$2.85
|
|
|
Diluted earnings per common share
|
|
|
$.76
|
|
|
|
$.72
|
|
|
$3.00
|
|
|
$2.84
|
|
|
Dividends declared per common share
|
|
|
$.230
|
|
|
|
$.195
|
|
|
$.885
|
|
|
$.780
|
|
|
Average common shares outstanding
|
|
|
1,821
|
|
|
|
1,872
|
|
|
1,839
|
|
|
1,887
|
|
|
Average diluted common shares outstanding
|
|
|
1,832
|
|
|
|
1,880
|
|
|
1,849
|
|
|
1,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Bancorp
|
|
Consolidated Ending Balance Sheet
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
December 31,
|
|
|
(Dollars in Millions)
|
|
|
2013
|
|
|
|
2012
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
$8,477
|
|
|
|
$8,252
|
|
|
Investment securities
|
|
|
|
|
|
|
|
|
|
Held-to-maturity
|
|
|
38,920
|
|
|
|
34,389
|
|
|
Available-for-sale
|
|
|
40,935
|
|
|
|
40,139
|
|
|
Loans held for sale
|
|
|
3,268
|
|
|
|
7,976
|
|
|
Loans
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
|
70,033
|
|
|
|
66,223
|
|
|
Commercial real estate
|
|
|
39,885
|
|
|
|
36,953
|
|
|
Residential mortgages
|
|
|
51,156
|
|
|
|
44,018
|
|
|
Credit card
|
|
|
18,021
|
|
|
|
17,115
|
|
|
Other retail
|
|
|
47,678
|
|
|
|
47,712
|
|
|
Total loans, excluding covered loans
|
|
|
226,773
|
|
|
|
212,021
|
|
|
Covered loans
|
|
|
8,462
|
|
|
|
11,308
|
|
|
Total loans
|
|
|
235,235
|
|
|
|
223,329
|
|
|
Less allowance for loan losses
|
|
|
(4,250
|
)
|
|
|
(4,424
|
)
|
|
Net loans
|
|
|
230,985
|
|
|
|
218,905
|
|
|
Premises and equipment
|
|
|
2,606
|
|
|
|
2,670
|
|
|
Goodwill
|
|
|
9,205
|
|
|
|
9,143
|
|
|
Other intangible assets
|
|
|
3,529
|
|
|
|
2,706
|
|
|
Other assets
|
|
|
26,096
|
|
|
|
29,675
|
|
|
Total assets
|
|
|
$364,021
|
|
|
|
$353,855
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
|
|
|
$76,941
|
|
|
|
$74,172
|
|
|
Interest-bearing
|
|
|
156,165
|
|
|
|
145,972
|
|
|
Time deposits greater than $100,000
|
|
|
29,017
|
|
|
|
29,039
|
|
|
Total deposits
|
|
|
262,123
|
|
|
|
249,183
|
|
|
Short-term borrowings
|
|
|
27,608
|
|
|
|
26,302
|
|
|
Long-term debt
|
|
|
20,049
|
|
|
|
25,516
|
|
|
Other liabilities
|
|
|
12,434
|
|
|
|
12,587
|
|
|
Total liabilities
|
|
|
322,214
|
|
|
|
313,588
|
|
|
Shareholders' equity
|
|
|
|
|
|
|
|
|
|
Preferred stock
|
|
|
4,756
|
|
|
|
4,769
|
|
|
Common stock
|
|
|
21
|
|
|
|
21
|
|
|
Capital surplus
|
|
|
8,216
|
|
|
|
8,201
|
|
|
Retained earnings
|
|
|
38,667
|
|
|
|
34,720
|
|
|
Less treasury stock
|
|
|
(9,476
|
)
|
|
|
(7,790
|
)
|
|
Accumulated other comprehensive income (loss)
|
|
|
(1,071
|
)
|
|
|
(923
|
)
|
|
Total U.S. Bancorp shareholders' equity
|
|
|
41,113
|
|
|
|
38,998
|
|
|
Noncontrolling interests
|
|
|
694
|
|
|
|
1,269
|
|
|
Total equity
|
|
|
41,807
|
|
|
|
40,267
|
|
|
Total liabilities and equity
|
|
|
$364,021
|
|
|
|
$353,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Bancorp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
September 30,
|
|
|
|
June 30,
|
|
|
|
March 31,
|
|
|
|
December 31,
|
|
|
|
(Dollars in Millions, Unaudited)
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
Total equity
|
|
|
$41,807
|
|
|
|
$41,552
|
|
|
|
$41,050
|
|
|
|
$40,847
|
|
|
|
$40,267
|
|
|
|
Preferred stock
|
|
|
(4,756
|
)
|
|
|
(4,756
|
)
|
|
|
(4,756
|
)
|
|
|
(4,769
|
)
|
|
|
(4,769
|
)
|
|
|
Noncontrolling interests
|
|
|
(694
|
)
|
|
|
(1,420
|
)
|
|
|
(1,367
|
)
|
|
|
(1,316
|
)
|
|
|
(1,269
|
)
|
|
|
Goodwill (net of deferred tax liability)
|
|
|
(8,343
|
)
|
|
|
(8,319
|
)
|
|
|
(8,317
|
)
|
|
|
(8,333
|
)
|
|
|
(8,351
|
)
|
|
|
Intangible assets, other than mortgage servicing rights
|
|
|
(849
|
)
|
|
|
(878
|
)
|
|
|
(910
|
)
|
|
|
(963
|
)
|
|
|
(1,006
|
)
|
|
|
Tangible common equity (a)
|
|
|
27,165
|
|
|
|
26,179
|
|
|
|
25,700
|
|
|
|
25,466
|
|
|
|
24,872
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 capital, determined in accordance with prescribed
regulatory requirements using Basel I definition
|
|
|
33,386
|
|
|
|
32,707
|
|
|
|
32,219
|
|
|
|
31,774
|
|
|
|
31,203
|
|
|
|
Preferred stock
|
|
|
(4,756
|
)
|
|
|
(4,756
|
)
|
|
|
(4,756
|
)
|
|
|
(4,769
|
)
|
|
|
(4,769
|
)
|
|
|
Noncontrolling interests, less preferred stock not eligible for
Tier 1 capital
|
|
|
(688
|
)
|
|
|
(686
|
)
|
|
|
(685
|
)
|
|
|
(684
|
)
|
|
|
(685
|
)
|
|
|
Tier 1 common equity using Basel I definition (b)
|
|
|
27,942
|
|
|
|
27,265
|
|
|
|
26,778
|
|
|
|
26,321
|
|
|
|
25,749
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity (as calculated above)
|
|
|
27,165
|
|
|
|
26,179
|
|
|
|
25,700
|
|
|
|
|
|
|
|
|
|
Adjustments (1)
|
|
|
224
|
|
|
|
258
|
|
|
|
195
|
|
|
|
|
|
|
|
|
|
Common equity tier 1 estimated using final rules for the Basel III
standardized approach (c)
|
|
|
27,389
|
|
|
|
26,437
|
|
|
|
25,895
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity (as calculated above)
|
|
|
|
|
|
|
|
|
25,700
|
|
|
|
25,466
|
|
|
|
24,872
|
|
|
|
Adjustments (2)
|
|
|
|
|
|
|
|
|
(43
|
)
|
|
|
81
|
|
|
|
126
|
|
|
|
Common equity tier 1 approximated using proposed rules for the
Basel III standardized approach released June 2012 (d)
|
|
|
|
|
|
|
|
|
25,657
|
|
|
|
25,547
|
|
|
|
24,998
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
364,021
|
|
|
|
360,681
|
|
|
|
353,415
|
|
|
|
355,447
|
|
|
|
353,855
|
|
|
|
Goodwill (net of deferred tax liability)
|
|
|
(8,343
|
)
|
|
|
(8,319
|
)
|
|
|
(8,317
|
)
|
|
|
(8,333
|
)
|
|
|
(8,351
|
)
|
|
|
Intangible assets, other than mortgage servicing rights
|
|
|
(849
|
)
|
|
|
(878
|
)
|
|
|
(910
|
)
|
|
|
(963
|
)
|
|
|
(1,006
|
)
|
|
|
Tangible assets (e)
|
|
|
354,829
|
|
|
|
351,484
|
|
|
|
344,188
|
|
|
|
346,151
|
|
|
|
344,498
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk-weighted assets, determined in accordance with prescribed
regulatory requirements using Basel I definition (f)
|
|
|
297,919
|
|
*
|
|
293,155
|
|
|
|
289,613
|
|
|
|
|
|
|
|
|
|
Adjustments (3)
|
|
|
13,712
|
|
*
|
|
13,473
|
|
|
|
12,476
|
|
|
|
|
|
|
|
|
|
Risk-weighted assets estimated using final rules for the Basel III
standardized approach (g)
|
|
|
311,631
|
|
*
|
|
306,628
|
|
|
|
302,089
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk-weighted assets, determined in accordance with prescribed
regulatory requirements using Basel I definition (f)
|
|
|
|
|
|
|
|
|
289,613
|
|
|
|
289,672
|
|
|
|
287,611
|
|
|
|
Adjustments (4)
|
|
|
|
|
|
|
|
|
20,866
|
|
|
|
21,021
|
|
|
|
21,233
|
|
|
|
Risk-weighted assets approximated using proposed rules for the
Basel III standardized approach released June 2012 (h)
|
|
|
|
|
|
|
|
|
310,479
|
|
|
|
310,693
|
|
|
|
308,844
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios *
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity to tangible assets (a)/(e)
|
|
|
7.7
|
|
%
|
|
7.4
|
|
%
|
|
7.5
|
|
%
|
|
7.4
|
|
%
|
|
7.2
|
|
%
|
|
Tangible common equity to risk-weighted assets using Basel I
definition (a)/(f)
|
|
|
9.1
|
|
|
|
8.9
|
|
|
|
8.9
|
|
|
|
8.8
|
|
|
|
8.6
|
|
|
|
Tier 1 common equity to risk-weighted assets using Basel I
definition (b)/(f)
|
|
|
9.4
|
|
|
|
9.3
|
|
|
|
9.2
|
|
|
|
9.1
|
|
|
|
9.0
|
|
|
|
Common equity tier 1 to risk-weighted assets estimated using final
rules for the Basel III standardized approach (c)/(g)
|
|
|
8.8
|
|
|
|
8.6
|
|
|
|
8.6
|
|
|
|
--
|
|
|
|
--
|
|
|
|
Common equity tier 1 to risk-weighted assets approximated using
proposed rules for the Basel III standardized approach released
June 2012 (d)/(h)
|
|
|
--
|
|
|
|
--
|
|
|
|
8.3
|
|
|
|
8.2
|
|
|
|
8.1
|
|
|
|
|
|
* Preliminary data. Subject to change prior to filings with
applicable regulatory agencies.
|
|
(1) Includes net losses on cash flow hedges included in
accumulated other comprehensive income and unrealized losses on
securities transferred from available-for-sale to held-to-maturity
included in accumulated other comprehensive income.
|
|
(2) Includes net losses on cash flow hedges included in
accumulated other comprehensive income, unrealized losses on
securities transferred from available-for-sale to held-to-maturity
included in accumulated other comprehensive income and disallowed
mortgage servicing rights.
|
|
(3) Includes higher risk-weighting for unfunded loan commitments,
investment securities and mortgage servicing rights, and other
adjustments.
|
|
(4) Includes higher risk-weighting for residential mortgages,
unfunded loan commitments, investment securities and mortgage
servicing rights, and other adjustments.
|
Source: U.S. Bancorp
U.S. Bancorp
Thomas Joyce
Media
(612) 303-3167
or
Judith
T. Murphy
Investors/Analysts
(612) 303-0783