U.s. Bancorp · NYSE:USB
U.s. Bancorp — Q4 2019 Earnings Presentation
30 slides from U.s. Bancorp's earnings presentation, Jan 15, 2020
Slide 1: U.S. Bancorp 4Q19 Earnings Conference Call
U.S. Bancorp 4Q19 Earnings Conference Call January 15, 2020 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: 4Q19 Highlights
4Q19 Highlights * Taxable-equivalent basis; see slide 26 for calculation
Slide 4: 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 5: Performance Ratios
Performance Ratios Efficiency Ratio** & Net Interest Margin*** * Excluding notable items; see slides 26 and 27 for calculations ** Non-GAAP; see slides 26 and 27 for calculations *** Net interest margin on a taxable-equivalent basis Return on Average Common Equity Return on Tangible Common Equity**
Slide 6: Average Loans
Average Loans +0.8% linked quarter +3.9% year-over-year On a linked quarter basis, average total loan growth was driven by growth in residential mortgages, total commercial real estate loans, and credit card loans. On a year-over-year basis, growth in average total loans was primarily driven by grow
Slide 7: Average Deposits
Average Deposits $ in billions +1.9% linked quarter +6.6% year-over-year Interest-bearing Deposits Average noninterest-bearing (NIB) deposits decreased on a linked quarter basis. On a year-over-year basis, average NIB deposits decreased primarily due to the migration of balances to interest-bearing
Slide 8: Credit Quality
Credit Quality $ in millions NCO Ratio +4 bps QoQ +3 bps YoY NPAs -0.05% QoQ -0.06% YoY
Slide 9: Earnings Summary
Earnings Summary Excluding $ and shares in millions, except EPS po Notable Items | Notable Items 4019 4018 % Change 4019 4018 | % Change Net Interest income $3,207 $3,303 29) : 29) Taxable-equivalent Adjustment 24 28 (14.3) : (143) Net Interest income {xabo-svivalert basis) 3,231 3,331 (3.0) - : (30
Slide 10: Notable Items
Notable Items $ in millions, except per share 4Q19 4018 Gain on sale of ATM business $- $340 Acquired impairment - (230) Other asset impairments - (34) Visa derivative liability charge (140) : Total noninterest income (140) 76 Severance charges 158 63 Other accruals and charges 42 114 Total noninter
Slide 11: Net Interest Income
Net Interest Income Linked Quarter Net interest income decreased, primarily driven by declining short-term interest rates, higher premium amortization in the investment securities portfolio, and the mix of earning assets. The net interest margin declined, primarily due to continued yield curve compr
Slide 12: 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 $2,498 $2,614 $2,436
Slide 13: Noninterest Expense
Noninterest Expense $ in millions PPS = postage, printing and supplies $3,280 $3,144 $3,401 +8.2% linked quarter +1.8% excluding notable items +3.7% year-over-year +3.1% excluding notable items Linked Quarter Employee benefits expense decreased, driven by seasonally lower payroll taxes. Technology a
Slide 14: Capital Position
Capital Position * Non-GAAP; see slide 28 for calculations
Slide 15: Appendix
Appendix U.S. BANCORP | 15
Slide 16: Average Loans
Average Loans vs. 4Q18 Average total loans increased by $11.2 billion, or 3.9% Average residential mortgage loans increased by $5.4 billion, or 8.4% Average commercial loans increased by $3.4 billion, or 3.4% Average credit card loans increased by $1.7 billion, or 7.6% Average retail loans increased
Slide 17: Average Deposits
Average Deposits Key Points Average Deposits ($bn) vs. 4Q18 Average total deposits increased by $22.1 billion, or 6.6% Average low-cost deposits (NIB, interest checking, savings and money market) increased by $21.1 billion, or 7.2% vs. 3Q19 Average total deposits increased by $6.5 billion, or 1.9% A
Slide 18: Credit Quality – Commercial
Credit Quality – Commercial Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q183Q194Q19 Average Loans$100,515$103,660 $103,911 30-89 Delinquencies0.31% 0.43%0.30% 90+ Delinquencies0.07%0.10%0.08% Nonperforming Loans0.20%0.30%0.20% Linked Quarter Growth 1.5% 1.4% 1.2% 0.4%
Slide 19: Credit Quality – Commercial Real Estate
Investor $20,106 Owner Occupied $9,027 A&D Const $267 Multi-family $3,586 Retail $289 Residential Construction $2,486 Office $797 Other $2,529 Resi Land $635 $mm4Q183Q194Q19 Average Loans$40,149$ 38,990 $39,722 30-89 Delinquencies0.18% 0.13%0.09% 90+ Delinquencies0.00%0.01%0.01% Nonperforming Loans0
Slide 20: Credit Quality – Residential Mortgage
Credit Quality – Residential Mortgage Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q183Q194Q19 Average Loans$64,476$ 68,608 $69,909 30-89 Delinquencies0.27%0.24%0.22% 90+ Delinquencies0.18%0.17%0.17% Nonperforming Loans0.46%0.36%0.34% * Excludes GNMA loans, whose repay
Slide 21: Credit Quality – Credit Card
Credit Quality – Credit Card Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q183Q194Q19 Average Loans$22,396$ 23,681 $24,107 30-89 Delinquencies1.39%1.33%1.30% 90+ Delinquencies1.25%1.16%1.23% Nonperforming Loans0.00%0.00%0.00% Linked Quarter Growth 2.9% 0.9% 1.0% 3.7% 1
Slide 22: Credit Quality – Home Equity
Credit Quality – Home Equity Average Loans ($mm) and Net Charge-offs Ratio Key Points Linked Quarter Growth 0.4% (0.4%) (1.0%) (1.5%) (2.4%) Key Statistics Key Statistics $mm4Q183Q194Q19 Average Loans$16,065$15,601$15,221 30-89 Delinquencies0.56%0.55%0.51% 90+ Delinquencies0.35%0.34%0.32% Nonperform
Slide 23: Credit Quality – Retail Leasing
Credit Quality – Retail Leasing Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q183Q194Q19 Average Loans$8,489$8,442$8,486 30-89 Delinquencies0.43%0.48%0.53% 90+ Delinquencies0.04%0.05%0.05% Nonperforming Loans0.14%0.14%0.15% * Manheim Used Vehicle Value Index source: ww
Slide 24: Credit Quality – Other Retail
Credit Quality – Other Retail Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q183Q194Q19 Average Loans$31,587$33,454$33,509 30-89 Delinquencies0.87%0.78%0.81% 90+ Delinquencies0.15%0.14%0.13% Nonperforming Loans0.13%0.13%0.11% Linked Quarter Growth 0.2% 1.1% 2.1% 2.7 % 0
Slide 25: Credit Quality – Auto Loans
Credit Quality – Auto Loans Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q183Q194Q19 Average Loans$18,500$19,426$19,434 30-89 Delinquencies1.04%1.04%1.06% 90+ Delinquencies0.09%0.11%0.10% Nonperforming Loans0.14%0.17%0.15% Direct: 4% Wtd Avg FICO: 750 NCO: 0.35% Indire
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures (2), (3), (4), (5) – see slide 29 for corresponding notes
Slide 27: Non-GAAP Financial Measures
Non-GAAP Financial Measures (1), (5) – see slide 29 for corresponding notes
Slide 28: Non-GAAP Financial Measures
Non-GAAP Financial Measures * Preliminary data. Subject to change prior to filings with applicable regulatory agencies. (1) – see slide 29 for corresponding note
Slide 29: Notes
Notes Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements. 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. Notable i
Slide 30: U.S. Bancorp 4Q19 Earnings Conference Call
U.S. Bancorp 4Q19 Earnings Conference Call January 15, 2020