U.s. Bancorp · NYSE:USB
U.s. Bancorp — Q3 2013 Earnings Presentation
30 slides from U.s. Bancorp's earnings presentation, Oct 16, 2013
Slide 1: U.S. Bancorp 3Q13 Earnings Conference Call
Exhibit 99.2 U.S. Bancorp 3Q13 Earnings Conference Call Richard K. Davis Chairman, President and CEO Andy Cecere October 16, 2013 Vice Chairman and CFO
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: This presentation contains forward-looking statements about U.S. Bancorp. Statements that are not historical or current facts, including st
Slide 3: 3Q13 Highlights
3Q13 Earnings 3Q13 Highlights Conference Call Net income of $1.5 billion; $0.76 per diluted common share Average loan growth of 5.7% vs. 3Q12 and average loan growth of 1.9% vs. 2Q13 Strong average deposit growth of 5.5% vs. 3Q12 and 2.0% vs. 2Q13 Net charge-offs declined 16.3% vs. 2Q13 Nonperformin
Slide 4: Performance Ratios
3Q13 Earnings Performance Ratios Conference Call Efficiency ratio computed as noninterest expense divided by the sum of net interest income on a taxable-equivalent 4 basis and noninterest income excluding securities gains (losses) net
Slide 5: Revenue Growth
3Q13 Earnings Revenue Growth Conference Call $ in millions Year-Over-Year Growth 5 Taxable-equivalent basis
Slide 6: Loan and Deposit Growth
3Q13 Earnings Loan and Deposit Growth Conference Call $ in billions Average Balances Year-Over-Year Growth 6
Slide 7: Credit Quality
3Q13 Earnings Credit Quality Conference Call $ in millions * Excluding Covered Assets (assets subject to loss sharing agreements with FDIC) ** Related to a regulatory clarification in the treatment of residential mortgage and other consumer 7 loans to borrowers who have exited bankruptcy but continu
Slide 8: Earnings Summary
3Q13 Earnings Earnings Summary Conference Call $ in millions, except per-share data % B/(W) YTD YTD 3Q13 2Q13 3Q12 vs 2Q13 vs 3Q12 2013 2012 % B/(W) Net Interest Income $ 2,714 $ 2,672 $ 2,783 1.6 (2.5) $ 8,095 $ 8,186 (1.1) Noninterest Income 2,177 2,276 2,396 (4.3) (9.1) 6,618 6,990 (5.3) Total Re
Slide 9: 3Q13 Results - Key Drivers
3Q13 Earnings 3Q13 Results - Key Drivers Conference Call vs. 3Q12 Net Revenue decline of 5.6% • Net interest income decline of 2.5%; net interest margin of 3.43% vs. 3.59% in 3Q12 • Noninterest income decline of 9.1% Noninterest expense decline of 1.7% Provision for credit losses lower by $190 milli
Slide 10: Capital Position
3Q13 Earnings Capital Position Conference Call $ in billions 3Q13 2Q13 1Q13 4Q12 3Q12 Shareholders' equity $ 40.1 $ 39.7 $ 39.5 $ 39.0 $ 38.7 Tier 1 capital 32.7 32.2 31.8 31.2 30.8 Total risk-based capital 38.9 38.4 38.1 37.8 37.6 Tier 1 common equity ratio 9.3% 9.2% 9.1% 9.0% 9.0% Tier 1 capital r
Slide 11: Mortgage Repurchase
3Q13 Earnings Mortgage Repurchase Conference Call Mortgages Repurchased and Make-whole Payments Repurchase activity lower than Mortgage Representation and Warranties Reserve peers due to: $ in millions 3Q13 2Q13 1Q13 4Q12 3Q12 • Conservative credit and Beginning Reserve $190 $233 $240 $220 $216 unde
Slide 12: 3Q13 Earnings Conference Call
3Q13 Earnings Conference Call 12
Slide 13: Appendix
3Q13 Earnings Conference Call Appendix 13
Slide 14: Average Loans
3Q13 Earnings Average Loans Conference Call $ in billions Average Loans Key Points vs. 3Q12 Average total loans grew by $12.4 billion, or 5.7% Average total loans, excluding covered loans, were higher by 7.5% Average total commercial loans increased $5.9 billion, or 9.4%; average residential mortgag
Slide 15: Average Deposits
3Q13 Earnings Average Deposits Conference Call $ in billions Average Deposits Key Points vs. 3Q12 Average total deposits increased by $13.1 billion, or 5.5% Average low cost deposits (NIB, interest checking, money market and savings) increased by $16.0 billion, or 8.5% vs. 2Q13 Average total deposit
Slide 16: Net Interest Income
3Q13 Earnings Net Interest Income Conference Call $ in millions Net Interest Income Key Points vs. 3Q12 Average earning assets grew by $6.1 billion, or 2.0% Net interest margin lower by 16 bps (3.43% vs. 3.59%) driven by: • Lower rates on investment securities and loans • Partially offset by lower r
Slide 17: Noninterest Income
3Q13 Earnings Noninterest Income Conference Call $ in millions Noninterest Income Key Points vs. 3Q12 Noninterest income declined by $219 million, or 9.1%, driven by: • Mortgage banking revenue decline of $191 million • Higher credit and debit card revenue (14.6% increase), due to higher transaction
Slide 18: Noninterest Expense
3Q13 Earnings Noninterest Expense Conference Call $ in millions Noninterest Expense Key Points vs. 3Q12 Noninterest expense was lower by $44 million, or 1.7%, driven by: • Lower professional services expense (34.7% decline), due to a reduction in mortgage servicing review-related costs • Lower compe
Slide 19: Credit Quality - Commercial Loans
3Q13 Earnings Credit Quality - Commercial Loans Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $56,655 $61,507 $62,856 30-89 Delinquencies 0.29% 0.23% 0.28% 90+ Delinquencies 0.07% 0.10% 0.08% Nonperforming Loans 0.23% 0.14% 0.16% C
Slide 20: Credit Quality - Commercial Leases
3Q13 Earnings Credit Quality - Commercial Leases Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $5,537 $5,255 $5,208 30-89 Delinquencies 0.93% 0.74% 0.76% 90+ Delinquencies 0.02% 0.00% 0.00% Nonperforming Loans 0.35% 0.27% 0.23% Com
Slide 21: Credit Quality - Commercial Real Estate
3Q13 Earnings Credit Quality - Commercial Real Estate Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $36,630 $37,884 $38,501 30-89 Delinquencies 0.18% 0.23% 0.16% 90+ Delinquencies 0.03% 0.03% 0.02% Nonperforming Loans 1.71% 1.11% 0
Slide 22: Credit Quality - Residential Mortgage
3Q13 Earnings Credit Quality - Residential Mortgage Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $40,969 $46,873 $49,139 30-89 Delinquencies 0.93% 0.78% 0.70% 90+ Delinquencies 0.72% 0.53% 0.53% Nonperforming Loans 1.81% 1.43% 1.4
Slide 23: Credit Quality - Credit Card
3Q13 Earnings Credit Quality - Credit Card Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $16,551 $16,416 $16,931 30-89 Delinquencies 1.41% 1.17% 1.25% 90+ Delinquencies 1.18% 1.10% 1.11% Nonperforming Loans 0.99% 0.65% 0.55% Commen
Slide 24: Credit Quality - Home Equity
3Q13 Earnings Credit Quality - Home Equity Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $17,329 $15,989 $15,648 30-89 Delinquencies 0.81% 0.74% 0.65% 90+ Delinquencies 0.32% 0.25% 0.25% Nonperforming Loans 1.05% 1.23% 1.15% Commen
Slide 25: Credit Quality - Retail Leasing
3Q13 Earnings Credit Quality - Retail Leasing Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $5,256 $5,653 $5,664 30-89 Delinquencies 0.17% 0.14% 0.15% 90+ Delinquencies 0.02% 0.00% 0.02% Nonperforming Loans 0.02% 0.02% 0.02% Commen
Slide 26: Credit Quality - Other Retail
3Q13 Earnings Credit Quality - Other Retail Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $25,406 $25,224 $25,682 30-89 Delinquencies 0.59% 0.46% 0.48% 90+ Delinquencies 0.16% 0.14% 0.14% Nonperforming Loans 0.12% 0.11% 0.10% Comme
Slide 27: Credit Quality - Auto Loans
3Q13 Earnings Credit Quality - Auto Loans Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 3Q12 2Q13 3Q13 Average Loans $12,211 $12,575 $12,946 30-89 Delinquencies 0.43% 0.30% 0.30% 90+ Delinquencies 0.06% 0.02% 0.03% Nonperforming Loans 0.06% 0.02% 0.02% Comment
Slide 28: Non-GAAP Financial Measures
3Q13 Earnings Non-GAAP Financial Measures Conference Call $ in millions 3Q13 2Q13 1Q13 4Q12 3Q12 Total equity $ 41,552 $ 41,050 $ 40,847 $ 40,267 $ 39,825 Preferred stock (4,756) (4,756) (4,769) (4,769) (4,769) Noncontrolling interests (1,420) (1,367) (1,316) (1,269) (1,164) Goodwill (net of deferre
Slide 29: Non-GAAP Financial Measures
3Q13 Earnings Non-GAAP Financial Measures Conference Call $ in millions 3Q13 2Q13 1Q13 4Q12 3Q12 Total assets $ 360,681 $ 353,415 $ 355,447 $ 353,855 $ 352,253 Goodwill (net of deferred tax liability) (8,319) (8,317) (8,333) (8,351) (8,194) Intangible assets, other than mortgage servicing rights (87
Slide 30: U.S. Bancorp 3Q13 Earnings Conference Call
U.S. Bancorp 3Q13 Earnings Conference Call October 16, 2013