U.s. Bancorp · NYSE:USB
U.s. Bancorp — Q1 2011 Earnings Presentation
32 slides from U.s. Bancorp's earnings presentation, Apr 19, 2011
Slide 1: U.S. Bancorp 1Q11 Earnings Conference Call
U.S. Bancorp 1Q11 Earnings Conference Call April 19, 2011 Richard K. Davis Chairman, President and CEO Andy Cecere Vice Chairman and CFO
Slide 2: Forward-looking Statements and Additional Information
2 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
Slide 3: 1Q11 Highlights
1Q11 Highlights Net income of $1.0 billion; $0.52 per diluted common share Total net revenue of $4.5 billion, up 4.6% vs. 1Q10 Net interest income growth of 4.3% vs. 1Q10 Noninterest income growth of 4.9% vs. 1Q10 Average loan growth of 2.4% (2.1% excluding acquisitions) vs. 1Q10 and average loan gr
Slide 4: Performance Ratios
Performance Ratios 1Q10 2Q10 3Q10 4Q10 1Q11 Return on Avg Common Equity 0.105 0.134 0.128 0.137 0.145 Return on Avg Common Equity 0.105 0.118 0.128 0.137 0.145 Return on Avg Assets 0.0096 0.0109 0.0126 0.0131 0.0138 1Q10 2Q10 3Q10 4Q10 1Q11 Efficiency Ratio 0.49 0.524 0.519 0.525 0.511 Net Interest
Slide 5: Capital Position
Capital Position $ in billions
Slide 6: Capital Actions
Capital Actions Dividend and share repurchase authorization announced March 18th Annual dividend raised from $0.20 to $0.50, a 150% increase One year share repurchase authorization of 50 million shares - we do not expect to begin buying back a meaningful number of shares before final Basel III capit
Slide 7: Loan and Deposit Growth
1Q10 2Q10 3Q10 4Q10 1Q11 Loans 192.9 191.2 192.5 195.5 197.6 Deposits 182.5 183.3 182.7 190.3 204.3 Loan and Deposit Growth Average Balances Year-Over-Year Growth 1Q11 Acquisition Adjusted Loan Growth = 2.1% Deposit Growth = 7.3% 2.4% $197.6 3.9% $192.9 4.0% $191.2 5.8% $192.5 2.0% $195.5 11.9% $204
Slide 8: Revenue Growth
Taxable-equivalent basis Revenue Growth Year-Over-Year Growth 11.3% 8.7% 7.9% 7.9% 4.6% $ in millions 1Q10 2Q10 3Q10 4Q10 1Q11 Reported 4321 4519 4587 4721 4519
Slide 9: Credit Quality
Credit Quality 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 NPA $ Change 76 49 155 290 357 489 727 626 386 184 91 -261 -171 -212 -159 NPA % Change 0.13 0.08 0.22 0.34 0.31 0.33 0.37 0.23 0.12 0.05 0.02 -0.07 -0.05 -0.06 -0.05 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09
Slide 10: Credit Quality - Outlook
Credit Quality - Outlook The Company expects the level of Net Charge-offs and Nonperforming Assets, excluding covered assets, to trend lower during 2Q11 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 30 to 89 % 0.010601156 0.0103876 0.011833483 0.016222915 0.017008547 0.014526577 0
Slide 11: Credit Quality - Reserves
Credit Quality - Reserves 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 Allowance 2260 2435 2648 2898 3639 4105 4571 4986 5264 5439 5536 5540 5531 5498 Provision/NCO's 1 1.66 1.51 1.5 2 1.67 1.5 1.4 1.25 1.15 1.02 1 0.97 0.94 Allowance for Credit Losses Allowance for Credit L
Slide 12: Earnings Summary
Earnings Summary $ in millions, except per-share data Taxable-equivalent basis
Slide 13: 1Q11 Results - Key Drivers
1Q11 Results - Key Drivers vs. 1Q10 Net Revenue growth of 4.6% (2.8% excluding significant items) Net interest income growth of 4.3%; net interest margin of 3.69% vs. 3.90% Noninterest income growth of 4.9% (1.0% excluding significant items) Significant items: net change of $75 million Noninterest e
Slide 14: Significant Items
Significant Items $ in millions
Slide 15: Net Interest Income
Net Interest Income 1Q10 2Q10 3Q10 4Q10 1Q11 Net Interest Income 2403 2409 2477 2499 2507 Net Interest Margin 0.039 0.039 0.0391 0.0383 0.0369 Net Interest Income Key Points $ in millions Taxable-equivalent basis vs. 1Q10 Average earning assets grew by $25.1 billion, or 10.1% (9.7% excluding acquisi
Slide 16: Average Loans
Average Loans 1Q10 2Q10 3Q10 4Q10 1Q11 Covered 21.415 20.454 19.308 18.572 17.638 Commercial 47.282 46.34 46.784 47.712 48.713 CRE 34.151 34.164 34.19 34.577 35.179 Res Mtg 26.408 26.821 27.89 29.659 31.777 Retail 63.622 63.382 64.369 64.964 64.263 Average Loans Key Points $ in billions Year-Over-Ye
Slide 17: Average Deposits
Average Deposits 1Q10 2Q10 3Q10 4Q10 1Q11 Time 45.606 43.607 43.607 42.388 46.492 Money Market 40.902 40.256 38.005 39.585 45.649 Checking & Savings 58.023 59.538 61.316 65.39 67.975 Noninterest-bearing 38 39.917 39.732 42.95 44.189 Average Deposits Key Points $ in billions Year-Over-Year Growth 13.
Slide 18: Noninterest Income
All Other Mortgage Service Charges Trust & Inv Mgmt Payments Noninterest Income 1Q10 2Q10 3Q10 4Q10 1Q11 All Other 287 384 346 518 422 Mortgage 200 243 310 250 199 Service Charges 449 452 404 383 392 Trust & Inv Mgmt 264 267 267 282 256 Payment Services 718 764 783 789 743 Noninterest Income Key Poi
Slide 19: Noninterest Expense
Noninterest Expense 1Q10 2Q10 3Q10 4Q10 1Q11 All Other 491 613 566 610 482 Tech & Communications 185 186 186 187 185 Prof Svcs, Marketing and PPS 192 234 260 281 209 Occupancy & Equip 227 226 229 237 249 Compensation & Benefits 1041 1118 1144 1170 1189 Noninterest Expense Key Points $ in millions Ye
Slide 20: Mortgage Repurchase
Mortgage Repurchase Mortgages Repurchased and Make-whole Payments Mortgage Representation and Warranties Reserve $ in millions 1Q11 4Q10 3Q10 2Q10 1Q10 Beginning Reserve $180 $147 $101 $73 $72 Net Realized Losses (32) (27) (24) (20) (22) Additions to Reserve 33 60 70 48 23 Ending Reserve $181 $180 $
Slide 21: Positioned to Win
ong . 1Q11 Earnings Positioned to Win Conference Call LJ Proven performance Building momentum (Sbancorp.
Slide 22: Appendix
1Q11 Earnings Conference Call LI Appendix (Sbancorp.
Slide 23: Credit Quality - Commercial Loans
Credit Quality - Commercial Loans 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 40837 40095 40726 41700 42683 Net Charge-offs Ratio 0.0241 0.0223 0.0149 0.0111 0.0119 Average Loans and Net Charge-offs Ratios Key Statistics Comments Overall delinquencies remain stable Continued improvement in nonperforming
Slide 24: Credit Quality - Commercial Leases
EF ST Balance 2401 3629 Credit Quality - Commercial Leases 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 6445 6245 6058 6012 6030 Net Charge-offs Ratio 0.0214 0.0141 0.0118 0.0112 0.0094 Average Loans and Net Charge-offs Ratios Key Statistics Comments Net charge-offs declined and early stage delinquencies
Slide 25: Credit Quality - Commercial Real Estate
Multi-Family Retail Res Construction Condo Construction A&D Commercial Office Other balance 1897 1024 1282 454 993 803 1017 Inv Owner balance 16359 11350 Credit Quality - Commercial Real Estate 1Q10 2Q10 3Q10 4Q10 1Q11 Avg Loans 34151 34164 34190 34577 35179 NCO Ratio 0.0228 0.0267 0.024 0.0251 0.01
Slide 26: Credit Quality - Residential Mortgage
1Q10 2Q10 3Q10 4Q10 1Q11 Restructured 1560 1672 1747 1804 1890 Credit Quality - Residential Mortgage 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 26408 26821 27890 29659 31777 Net Charge-offs Ratio 0.0223 0.0206 0.0188 0.0175 0.0165 Average Loans and Net Charge-offs Ratios Key Statistics Comments Strong g
Slide 27: Credit Quality - Home Equity
Credit Quality - Home Equity 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 19402 19332 19289 19119 18801 Net Charge-offs Ratio 0.0188 0.0164 0.0162 0.0172 0.0175 Average Loans and Net Charge-offs Ratios Key Statistics Comments Strong credit quality portfolio (weighted average FICO 746, weighted average CLT
Slide 28: Credit Quality - Credit Card
Traditional Consumer Finance Balance 15542 582 1Q09 4Q10 1Q11 Average Loans 16,368 16,403 16,124 30-89 Delinquencies 2.35% 1.60% 1.44% 90+ Delinquencies 2.57% 1.86% 1.62% Nonperforming Loans 1.02% 1.36% 1.61% Credit Quality - Credit Card 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 16368 16329 16510 16403
Slide 29: Credit Quality - Retail Leasing
Credit Quality - Retail Leasing 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 4509 4364 4289 4459 4647 Net Charge-offs Ratio 0.0045 0.0037 0.0019 0.0009 0.0009 Average Loans and Net Charge-offs Ratios Key Statistics Comments Average loans increased during the quarter as demand for new auto leases increased
Slide 30: Credit Quality - Other Retail
Auto Install Student Revolving Balance 10879 5380 5011 3421 Credit Quality - Other Retail 1Q10 2Q10 3Q10 4Q10 1Q11 Average Loans 23343 23357 24281 24983 24691 Net Charge-offs Ratio 0.0193 0.017 0.0165 0.0145 0.0133 Average Loans and Net Charge-offs Ratios Key Statistics Comments Average balances inc
Slide 31: Non-Regulatory Capital Ratios
Non-Regulatory Capital Ratios
Slide 32: U.S. Bancorp 1Q11 Earnings Conference Call
U.S. Bancorp 1Q11 Earnings Conference Call April 19, 2011