U.s. Bancorp · NYSE:USB
U.s. Bancorp — Q3 2017 Earnings Presentation
26 slides from U.s. Bancorp's earnings presentation, Oct 18, 2017
Slide 1: U.S. Bancorp 3Q17 Earnings Conference Call
U.S. Bancorp 3Q17 Earnings Conference Call October 18, 2017 Exhibit 99.2
Slide 2: Forward-looking Statements and Additional Information
Forward-looking Statements and Additional Information The following information appears in accordance with the Private Securities Litigation Reform Act of 1995: Today’s presentation contains forward-looking statements about U.S. Bancorp. Statements that are not historical or current facts, including
Slide 3: 3Q17 Highlights
3Q17 Highlights * Taxable-equivalent basis; see slide 25 for calculation ** Estimated for the Basel III fully implemented standardized approach; RWA = risk-weighted assets, see slide 24 for calculation
Slide 4: Performance Ratios
Performance Ratios Return on Average Common Equity Efficiency Ratio* & Net Interest Margin** * Non-GAAP; see slide 25 for calculation ** Taxable-equivalent basis Return on Average Assets
Slide 5: Average Loans
Average Loans +0.8% linked quarter +3.0% year-over-year Linked quarter growth in total loans was driven primarily by commercial loans, other retail loans and retail leasing Year-over-year and linked quarter declines in commercial real estate loans reflected disciplined underwriting of construction a
Slide 6: Average Deposits
Average Deposits +1.2% linked quarter +5.2% year-over-year $ in billions Rates are presented on a fully taxable-equivalent basis utilizing a tax rate of 35 percent Interest-bearing Deposits Average noninterest-bearing deposits decreased 0.9% on a linked quarter basis Average noninterest-bearing depo
Slide 7: Credit Quality
Credit Quality NCO Ratio -2bps QoQ +1bp YoY NPAs -7.3% QoQ -24.8% YoY $ in millions
Slide 8: Earnings Summary
Earnings Summary $ and shares in nilfons, except EPS Reported % Change 3Q17 2017 3016 vs. aT vs. 3016 Net Interest Income $3,135] $3,017 $2,893 Tax atio-qualent Adjustment 51 51 50 - 2.0 Net Interes (t atte saat basis) Nonint som xpense perating Income Net Charge-offs Excess Provision io ie Before T
Slide 9: Net Interest Income
Net Interest Income Linked Quarter Net interest income growth was driven by loan growth, the impact of rising rates, higher interest recoveries and an additional day in the third quarter Net interest margin growth was driven by higher interest rates and a change in loan portfolio mix, partially offs
Slide 10: Noninterest Income
Noninterest Income $ in millions Payments = credit and debit card, corporate payment products and merchant processing Service charges = deposit service charges, treasury management and ATM processing $2,445 $2,419 $2,422 Linked Quarter Solid growth in corporate payment products and deposit service c
Slide 11: Noninterest Expense
Noninterest Expense $2,931 $3,023 $3,039 Linked Quarter Growth in noninterest expense was driven by higher compensation expense, principally due to corporate incentive plans and the impact of hiring to support growth Year-over-Year Growth in compensation expense was partially offset by a decrease in
Slide 12: Capital Position
Capital Position RWA = risk-weighted assets * See Non-GAAP Financial Measures reconciliation on slide 24
Slide 13: Appendix
Appendix U.S, BANCORP | 13
Slide 14: Average Loans
Average Loans vs. 3Q16 Average total loans increased by $8.0 billion, or 3.0% Average commercial loans increased by $4.3 billion, or 4.6% Average retail loans increased by $3.2 billion, or 6.1% Average residential mortgage loans increased by $2.7 billion, or 4.9% vs. 2Q17 Average total loans increas
Slide 15: Average Deposits
Average Deposits Key Points Average Deposits ($bn) vs. 3Q16 Average total deposits increased by $16.6 billion, or 5.2% Average low-cost deposits (NIB, interest checking, money market and savings) increased by $12.7 billion, or 4.4% vs. 2Q17 Average total deposits increased by $4.0 billion, or 1.2% A
Slide 16: Credit Quality – Commercial Loans
Credit Quality – Commercial Loans Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$92,369$95,638$96,633 30-89 Delinquencies0.24%0.27%0.22% 90+ Delinquencies0.05%0.05%0.05% Nonperforming Loans0.55%0.33%0.28% Commercial loan growth primarily driven
Slide 17: Credit Quality – Commercial Real Estate
A&D Construction $499 Credit Quality – Commercial Real Estate Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$43,374$42,549$41,621 30-89 Delinquencies0.08%0.08%0.15% 90+ Delinquencies0.02%0.00%0.01% Nonperforming Loans0.24%0.28%0.29% Performing T
Slide 18: Credit Quality – Residential Mortgage
Credit Quality – Residential Mortgage Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$56,284$58,544$59,030 30-89 Delinquencies0.26%0.22%0.26% 90+ Delinquencies0.28%0.20%0.18% Nonperforming Loans1.09%0.90%0.80% *Excludes GNMA loans, whose repaymen
Slide 19: Credit Quality – Credit Card
Credit Quality – Credit Card Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points Year-over-year average loan growth of 1.4% driven by high credit quality originations Commitment weighted average FICO on new originations remained strong at 760 Year-over-year increases in delinquen
Slide 20: Credit Quality – Home Equity
Credit Quality – Home Equity Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$16,470$16,252$16,299 30-89 Delinquencies0.41%0.33%0.38% 90+ Delinquencies0.24%0.25%0.24% Nonperforming Loans0.75%0.74%0.75% Subprime: 1% Wtd Avg LTV*: 88% NCO: 3.05% Pri
Slide 21: Credit Quality – Retail Leasing
Credit Quality – Retail Leasing Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$5,773$7,181$7,762 30-89 Delinquencies0.21%0.22%0.31% 90+ Delinquencies0.00%0.01%0.03% Nonperforming Loans0.05%0.07%0.09% * Manheim Used Vehicle Value Index source: ww
Slide 22: Credit Quality – Other Retail
Credit Quality – Other Retail Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$30,608$31,194$32,008 30-89 Delinquencies0.56%0.65%0.75% 90+ Delinquencies0.11%0.11%0.13% Nonperforming Loans0.08%0.10%0.10% Overall growth continued to be driven by aut
Slide 23: Credit Quality – Auto Loans
Credit Quality – Auto Loans Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm3Q162Q173Q17 Average Loans$17,205$17,533$18,008 30-89 Delinquencies0.59%0.73%0.89% 90+ Delinquencies0.05%0.06%0.08% Nonperforming Loans0.08%0.12%0.11% Direct: 5% Wtd Avg FICO: 748 NCO: 0.19% Indire
Slide 24: Non-GAAP Financial Measures
Non-GAAP Financial Measures * Preliminary data. Subject to change prior to filings with applicable regulatory agencies. (1) Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements. (2) Includes net losses on cash flow hedges in
Slide 25: Non-GAAP Financial Measures
Non-GAAP Financial Measures (1) Utilizes a tax rate of 35 percent for those assets and liabilities whose income or expense is not included for federal income tax purposes.
Slide 26: U.S. Bancorp 3Q17 Earnings Conference Call
U.S. Bancorp 3Q17 Earnings Conference Call October 18, 2017