U.s. Bancorp · NYSE:USB
U.s. Bancorp — Q2 2019 Earnings Presentation
28 slides from U.s. Bancorp's earnings presentation, Jul 17, 2019
Slide 1: U.S. Bancorp 2Q19 Earnings Conference Call
U.S. Bancorp 2Q19 Earnings Conference Call July 17, 2019 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: 2Q19 Highlights
2Q19 Highlights * Taxable-equivalent basis; see slide 25 for calculation ** Excluding the impact of FDIC covered loans sold in 4Q18, average total loans grew 4.5% vs. 2Q18
Slide 4: Performance Ratios
Performance Ratios Efficiency Ratio* & Net Interest Margin Net interest margin on a taxable-equivalent basis * Non-GAAP; see slides 25 and 26 for calculations Return on Average Common Equity Return on Tangible Common Equity* Return on Average Assets
Slide 5: Average Loans
Average Loans +1.1% linked quarter +3.8% year-over-year On a linked quarter basis, average total loan growth was driven by growth in total commercial loans, residential mortgages and seasonal growth in credit card balances. On a year-over-year basis, growth in average total loans was primarily drive
Slide 6: Average Deposits
Average Deposits $ in billions +2.9% linked quarter +3.1% year-over-year Interest-bearing Deposits Average total savings deposits (which include money market, interest checking and savings accounts) increased 3.8 percent linked quarter, primarily driven by growth within Wealth Management and Investm
Slide 7: Credit Quality
Credit Quality $ in millions NCO Ratio -3 bps QoQ +1 bp YoY NPAs -5.2% QoQ -12.6% YoY
Slide 8: Earnings Summary
Earnings Summary $ and shares in milions, except EPS Reported % Change 2019 1019 2018 vs.1Q19 vs. ae Net Interest Income $3,305 $3,259 $3,197 4 Tentie-cauhefer Adjustment 27 27 29 - 6: ° Net Interest Inco! (Geabiecquncion basis) 3,332 3,286 3,226 14 33 2490 2,291 2,414 87 34 Net Revenue 5822 5,577 «
Slide 9: Net Interest Income
Net Interest Income Linked Quarter Net interest income growth was primarily driven by growth in earning assets, an additional day in the second quarter and higher interest recoveries. The net interest margin declined, primarily due to the inversion of the yield curve in the second quarter, seasonall
Slide 10: Noninterest Income
Noninterest Income $ in millions Payments = credit and debit card, corporate payment products and merchant processing Service charges = deposit service charges and treasury management All other = commercial products, investment products fees, securities gains (losses) and other $2,414 $2,291 $2,490
Slide 11: Noninterest Expense
Noninterest Expense Linked Quarter Compensation expense increased due to the impact of seasonal merit increases and an additional day in the second quarter. Growth in professional services expense and marketing and business development expense both reflected seasonally higher activity. Employee bene
Slide 12: Capital Position
Capital Position * Non-GAAP; see slide 27 for calculations
Slide 13: Digital Engagement Trends
Digital Engagement Trends * Represents core Consumer Banking customers active in at least one channel in the previous 90 days Total Digital includes both online and mobile platforms Three months ended Three months ended
Slide 14: Appendix
Appendix
Slide 15: Average Loans
Average Loans vs. 2Q18 Average total loans increased by $10.6 billion, or 3.8% Average commercial loans increased by $4.9 billion, or 5.0% Average residential mortgage loans increased by $6.0 billion, or 9.9% Average credit card loans increased by $1.6 billion, or 7.6% Average retail loans increased
Slide 16: Average Deposits
Average Deposits Key Points Average Deposits ($bn) vs. 2Q18 Average total deposits increased by $10.4 billion, or 3.1% Average low-cost deposits (NIB, interest checking, savings and money market) increased by $0.8 billion, or 0.3% vs. 1Q19 Average total deposits increased by $9.9 billion, or 2.9% Av
Slide 17: Credit Quality – Commercial
Credit Quality – Commercial Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm2Q181Q192Q19 Average Loans$98,353$101,960 $103,233 30-89 Delinquencies0.23% 0.58%0.34% 90+ Delinquencies0.06%0.07%0.26% Nonperforming Loans0.23%0.26%0.27% Linked Quarter Growth 0.9% 0.7% 1.5% 1.4%
Slide 18: Credit Quality – Commercial Real Estate
Investor $19,127 Owner Occupied $9,338 A&D Const $282 Multi-family $3,842 Retail $328 Residential Construction $2,365 Office $875 Other $2,544 Resi Land $664 $mm2Q181Q192Q19 Average Loans$39,857$39,470 $39,365 30-89 Delinquencies0.11% 0.11%0.07% 90+ Delinquencies0.01%0.01%0.00% Nonperforming Loans0.
Slide 19: Credit Quality – Residential Mortgage
Credit Quality – Residential Mortgage Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm2Q181Q192Q19 Average Loans$60,834$65,582$66,834 30-89 Delinquencies0.27%0.26%0.26% 90+ Delinquencies0.18%0.18%0.17% Nonperforming Loans0.65%0.43%0.39% * Excludes GNMA loans, whose repayme
Slide 20: Credit Quality – Credit Card
Credit Quality – Credit Card Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm2Q181Q192Q19 Average Loans$21,220$22,597$22,830 30-89 Delinquencies1.22%1.31%1.23% 90+ Delinquencies1.15%1.29%1.14% Nonperforming Loans0.00%0.00%0.00% Linked Quarter Growth (0.3%) 2.6% 2.9% 0.9% 1
Slide 21: Credit Quality – Home Equity
Credit Quality – Home Equity Average Loans ($mm) and Net Charge-offs Ratio Key Points Linked Quarter Growth (0.9%) (0.3%) 0.4% (0.4%) (1.0%) Key Statistics Key Statistics $mm2Q181Q192Q19 Average Loans$16,048$15,993$15,831 30-89 Delinquencies0.39%0.54%0.51% 90+ Delinquencies0.29%0.37%0.34% Nonperform
Slide 22: Credit Quality – Retail Leasing
Credit Quality – Retail Leasing Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm2Q181Q192Q19 Average Loans$8,150$8,586$8,547 30-89 Delinquencies0.30%0.42%0.45% 90+ Delinquencies0.02%0.03%0.02% Nonperforming Loans0.12%0.12%0.13% * Manheim Used Vehicle Value Index source: ww
Slide 23: Credit Quality – Other Retail
Credit Quality – Other Retail Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm2Q181Q192Q19 Average Loans$31,265$31,922$32,578 30-89 Delinquencies0.75%0.78%0.80% 90+ Delinquencies0.13%0.14%0.13% Nonperforming Loans0.12%0.13%0.12% Linked Quarter Growth (4.9%) 0.8% 0.2% 1.1 %
Slide 24: Credit Quality – Auto Loans
Credit Quality – Auto Loans Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm2Q181Q192Q19 Average Loans$18,599$18,833$19,023 30-89 Delinquencies0.90%0.95%1.01% 90+ Delinquencies0.08%0.08%0.09% Nonperforming Loans0.13%0.15%0.15% Direct: 4% Wtd Avg FICO: 747 NCO: 0.24% Indire
Slide 25: Non-GAAP Financial Measures
Non-GAAP Financial Measures (1) Based on a federal income tax rate of 21 percent for those assets and liabilities whose income or expense is not included for federal income tax purposes.
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures (1) Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements.
Slide 27: 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.
Slide 28: U.S. Bancorp 2Q19 Earnings Conference Call
U.S. Bancorp 2Q19 Earnings Conference Call July 17, 2019