U.s. Bancorp · NYSE:USB
U.s. Bancorp — Q2 2013 Earnings Presentation
31 slides from U.s. Bancorp's earnings presentation, Jul 17, 2013
Slide 1: U.S. Bancorp 2Q13 Earnings Conference Call
Exhibit 99.2 U.S. Bancorp 2Q13 Earnings Conference Call Richard K. Davis Chairman, President and CEO Andy Cecere July 17, 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: 2Q13 Highlights
2Q13 Earnings 2Q13 Highlights Conference Call Record net income of $1.5 billion; $0.76 per diluted common share Average loan growth of 5.2% vs. 2Q12 and average loan growth of 1.2% vs. 1Q13 Strong average deposit growth of 7.0% vs. 2Q12 and 1.0% vs. 1Q13 Net charge-offs declined 9.5% vs. 1Q13 Nonper
Slide 4: Performance Ratios
2Q13 Earnings Performance Ratios Conference Call Efficiency Ratio and ROCE and ROA Net Interest Margin Return on Avg Common Equity Return on Avg Assets Efficiency Ratio Net Interest Margin Efficiency ratio computed as noninterest expense divided by the sum of net interest income on a taxable-equival
Slide 5: Revenue Growth
2Q13 Earnings Revenue Growth Conference Call $ in millions Year-Over-Year Growth 8.1% 8.0% 0.2% (1.1%) (2.4%) 5,500 $5,179 $5,068 $5,112 5,000 $4,948 $4,874 4,500 4,000 3,500 2Q12 3Q12 4Q12 1Q13 2Q13 5 Taxable-equivalent basis
Slide 6: Loan and Deposit Growth
2Q13 Earnings Loan and Deposit Growth Conference Call $ in billions Average Balances Year-Over-Year Growth 7.0% 9.2% 7.3% 250.0 11.1% $247.4 $243.8 $245.0 10.5% $239.3 $231.3 5.2% 6.4% 5.8% 230.0 $225.2 7.3% $222.4 7.7% $220.3 $216.9 $214.1 210.0 190.0 170.0 2Q12 3Q12 4Q12 1Q13 2Q13 Loans Deposits 6
Slide 7: Credit Quality
2Q13 Earnings Credit Quality Conference Call $ in millions Net Charge-offs (Left Scale) Nonperforming Assets (Left Scale) NCOs to Avg Loans (Right Scale) NPAs to Loans plus ORE (Right Scale) * Excluding Covered Assets (assets subject to loss sharing agreements with FDIC) ** Related to a regulatory c
Slide 8: Earnings Summary
2Q13 Earnings Earnings Summary Conference Call $ in millions, except per-share data % B/(W) YTD YTD 2Q13 1Q13 2Q12 vs 1Q13 vs 2Q12 2013 2012 % B/(W) Net Interest Income $ 2,672 $ 2,709 $ 2,713 (1.4) (1.5) $ 5,381 $ 5,403 (0.4) Noninterest Income 2,276 2,165 2,355 5.1 (3.4) 4,441 4,594 (3.3) Total Re
Slide 9: 2Q13 Results - Key Drivers
2Q13 Earnings 2Q13 Results - Key Drivers Conference Call vs. 2Q12 Net Revenue decline of 2.4% • Net interest income decline of 1.5%; net interest margin of 3.43% vs. 3.58% in 2Q12 • Noninterest income decline of 3.4% Noninterest expense decline of 1.7% Provision for credit losses lower by $108 milli
Slide 10: Capital Position
2Q13 Earnings Capital Position Conference Call $ in billions 2Q13 1Q13 4Q12 3Q12 2Q12 Shareholders' equity $ 39.7 $ 39.5 $ 39.0 $ 38.7 $ 37.8 Tier 1 capital 32.2 31.8 31.2 30.8 30.0 Total risk-based capital 38.4 38.1 37.8 37.6 36.4 Tier 1 common equity ratio 9.2% 9.1% 9.0% 9.0% 8.8% Tier 1 capital r
Slide 11: Capital Actions
2Q13 Earnings Capital Actions Conference Call th Dividend increase announced June 18 • Annual dividend increased from $0.78 to $0.92, an 18% increase • One year authorization to repurchase up to $2.25 billion of outstanding stock effective April 1, 2013 Returned 73% of earnings to shareholders durin
Slide 12: Mortgage Repurchase
2Q13 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 2Q13 1Q13 4Q12 3Q12 2Q12 • Conservative credit and Beginning Reserve $233 $240 $220 $216 $202 unde
Slide 13: A Rich Heritage A Strong Future
A Rich Heritage A Strong Future 1863 - 2013 13
Slide 14: Appendix
2Q13 Earnings Conference Call Appendix 14
Slide 15: Average Loans
2Q13 Earnings Average Loans Conference Call $ in billions Average Loans Key Points vs. 2Q12 Average total loans grew by $11.1 billion, or 5.2% Average total loans, excluding covered loans, were higher by 7.2% Average total commercial loans increased $6.7 billion, or 11.2%; average residential mortga
Slide 16: Average Deposits
2Q13 Earnings Average Deposits Conference Call $ in billions Average Deposits Key Points vs. 2Q12 Average total deposits increased by $16.1 billion, or 7.0% 280 Average low cost deposits (NIB, interest checking, money market and savings) 210 16.2% 14.2% 4.4% Noninterest -bearing 3.6% increased by $1
Slide 17: Net Interest Income
2Q13 Earnings Net Interest Income Conference Call $ in millions Net Interest Income Key Points Year-Over-Year Growth vs. 2Q12 6.6% 6.1% 4.1% 0.7% (1.5%) Average earning assets grew by $8.2 billion, or 2.7% 4,000 8.0% Net interest margin lower by 15 bps (3.43% vs. 3.58%) driven by: 3,000 $2,713 $2,78
Slide 18: Noninterest Income
2Q13 Earnings Noninterest Income Conference Call $ in millions Noninterest Income Key Points vs. 2Q12 Year-Over-Year Growth Noninterest income declined by $79 million, or 3.4%, 9.7% 10.4% (4.2%) (3.3%) (3.4%) driven by: 2,800 • Mortgage banking revenue decline of $94 million $2,355 $2,396 $2,329 • L
Slide 19: Noninterest Expense
2Q13 Earnings Noninterest Expense Conference Call $ in millions Noninterest Expense Key Points Year-Over-Year Growth vs. 2Q12 7.3% 5.4% (0.4%) (3.5%) (1.7%) Noninterest expense was lower by $44 million, or $2,601 $2,609 $2,686 1.7%, driven by: $2,557 $2,470 • Lower other expense, mainly due to prior
Slide 20: Credit Quality - Commercial Loans
2Q13 Earnings Credit Quality - Commercial Loans Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 80,000 4.0% Average Loans $54,362 $59,921 $61,507 30-89 Delinquencies 0.26% 0.20% 0.23% $59,921 $61,507 60,000 $56,655 $58,552 3.0% 90+ Delinquencies 0
Slide 21: Credit Quality - Commercial Leases
2Q13 Earnings Credit Quality - Commercial Leases Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 8,000 4.0% Average Loans $5,658 $5,378 $5,255 30-89 Delinquencies 0.83% 0.82% 0.74% 6,000 $5,658 $5,537 3.0% 90+ Delinquencies 0.00% 0.00% 0.00% $5,37
Slide 22: Credit Quality - Commercial Real Estate
2Q13 Earnings Credit Quality - Commercial Real Estate Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 45,000 0.9% Average Loans $36,549 $37,218 $37,884 $36,549 $36,630 $36,851 $37,218 $37,884 30-89 Delinquencies 0.24% 0.22% 0.23% 30,000 0.6% 90+ D
Slide 23: Credit Quality - Residential Mortgage
2Q13 Earnings Credit Quality - Residential Mortgage Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 60,000 4.0% Average Loans $39,166 $45,109 $46,873 30-89 Delinquencies 0.86% 0.71% 0.78% $46,873 $45,109 45,000 $43,156 3.0% 90+ Delinquencies 0.80%
Slide 24: Credit Quality - Credit Card
2Q13 Earnings Credit Quality - Credit Card Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 20,000 10.0% Average Loans $16,696 $16,528 $16,416 $16,696 $16,551 $16,588 $16,528 $16,416 30-89 Delinquencies 1.20% 1.24% 1.17% 15,000 7.5% 90+ Delinquenci
Slide 25: Credit Quality - Home Equity
2Q13 Earnings Credit Quality - Home Equity Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 24,000 6.0% Average Loans $17,598 $16,434 $15,989 30-89 Delinquencies 0.71% 0.70% 0.74% 18,000 $17,598 $17,329 $16,950 4.5% 90+ Delinquencies 0.30% 0.27% 0.
Slide 26: Credit Quality - Retail Leasing
2Q13 Earnings Credit Quality - Retail Leasing Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 9,000 1.5% Average Loans $5,151 $5,448 $5,653 30-89 Delinquencies 0.13% 0.12% 0.14% 6,000 $5,256 $5,384 $5,448 $5,653 1.0% 90+ Delinquencies 0.00% 0.02%
Slide 27: Credit Quality - Other Retail
2Q13 Earnings Credit Quality - Other Retail Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 40,000 4.0% Average Loans $25,151 $25,364 $25,224 30-89 Delinquencies 0.51% 0.48% 0.46% 30,000 3.0% 90+ Delinquencies 0.16% 0.16% 0.14% $25,151 $25,406 $25
Slide 28: Credit Quality - Auto Loans
2Q13 Earnings Credit Quality - Auto Loans Conference Call $ in millions Average Loans and Net Charge-offs Ratios Key Statistics 2Q12 1Q13 2Q13 16,000 0.8% Average Loans $11,974 $12,519 $12,575 $12,540 $12,519 $12,575 30-89 Delinquencies 0.40% 0.30% 0.30% $11,974 $12,211 12,000 0.6% 90+ Delinquencies
Slide 29: Non-GAAP Financial Measures
2Q13 Earnings Non-GAAP Financial Measures Conference Call $ in millions 2Q13 1Q13 4Q12 3Q12 2Q12 Total equity $ 41,050 $ 40,847 $ 40,267 $ 39,825 $ 38,874 Preferred stock (4,756) (4,769) (4,769) (4,769) (4,769) Noncontrolling interests (1,367) (1,316) (1,269) (1,164) (1,082) Goodwill (net of deferre
Slide 30: Non-GAAP Financial Measures
2Q13 Earnings Non-GAAP Financial Measures Conference Call $ in millions 2Q13 1Q13 4Q12 3Q12 2Q12 Total assets $ 353,415 $ 355,447 $ 353,855 $ 352,253 $ 353,136 Goodwill (net of deferred tax liability) (8,317) (8,333) (8,351) (8,194) (8,205) Intangible assets (exclude mortgage servicing rights) (910)
Slide 31: U.S. Bancorp 2Q13 Earnings Conference Call
U.S. Bancorp 2Q13 Earnings Conference Call July 17, 2013