U.s. Bancorp · NYSE:USB
U.s. Bancorp — BancAnalysts Association of Boston Conference 2015
39 slides from U.s. Bancorp's conference presentation, Nov 5, 2015
Slide 1: BancAnalysts Association of Boston Conference
Exhibit 99.1 BancAnalysts Association of Boston Conference Kathy Rogers Vice Chairman and CFO November 5, 2015
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: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP | 3
Slide 4: U.S. Bancorp 3Q15 Dimensions
U.S. Bancorp 3Q15 Dimensions NYSE Traded USB Branches 3,151 Assets $416B Founded 1863 ATMs 5,001 Deposits $295B Market Value $74B Customers 18.5M Loans $255B Market value as of 10/30/15 U.S. BANCORP | 4
Slide 5: Industry Position
Industry Position Assets Deposits Market Value U.S. U.S. U.S. Rank Company $ Billions Rank Company $ Billions Rank Company $ Billions 1 J.P. Morgan 2,417 1 J.P. Morgan 1,273 1 Wells Fargo 279 2 Bank of America 2,153 2 Wells Fargo 1,202 2 J.P. Morgan 239 3 Citigroup 1,808 3 Bank of America 1,162 3 Ba
Slide 6: Peer Banks
Peer Banks U.S. Bancorp J.P. Morgan KeyCorp PNC Wells Fargo Fifth Third BBT Bank of America SunTrust Regions Peer Bank Ticker Symbols BAC Bank of America PNC PNC BBT BB&T RF Regions FITB Fifth Third STI SunTrust JPM J.P. Morgan USB U.S. Bancorp KEY KeyCorp WFC Wells Fargo U.S. BANCORP | 6
Slide 7: Industry Leading Returns 3Q15
Industry Leading Returns 3Q15 Return on Average Assets Return on Average Common Equity 1.44% 14.1% 1.32% 12.7% 1.17% 1.13% 1.11% 11.5% 1.07% 1.03% 10.0% 9.6% 0.92% 9.3% 0.83% 0.82% 8.2% 8.1% 7.0% 6.0% USB Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9 USB Peer 1 Peer 2 Peer 3 Peer 4
Slide 8: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP | 8
Slide 9: Revenue Diversification
Revenue Diversification Revenue Mix Fee Income / Total Revenue By Business Line 55% 50% Payment Services 46% 45% 45% 45% 30% 45% 40% Wealth Mgmt and Securities Services 35% 11% 2012 2013 2014 3Q15 YTD Consumer and Wholesale Small Business Banking and Banking Commercial Real Estate 42% 17% 55% 45% 20
Slide 10: Best in Class Debt Rating
Best in Class Debt Rating USB is highest rated peer bank across all rating agencies • Funding advantage • Competitive advantages – Pricing Holding Moody's S&P Fitch DBRS Company Rating Outlook Rating Outlook Rating Outlook Rating Outlook – Flight-to-quality USB A1 s A+ s AA s AA s – Sales Force WFC
Slide 11: Credit Quality
Credit Quality Net Charge-offs Nonperforming Assets 520 3.00% 2,800 3.00% 390 2.25% 2,100 $1,923 2.25% $336 $1,808 $1,696 $308 $296 $292 $1,577 $1,567 $279 260 1.50% 1,400 1.50% 0.78% 0.73% 0.69% 0.63% 0.61% 130 0.55% 0.75% 700 0.75% 0.50% 0.46% 0.48% 0.46% 0 0.00% 0 0.00% 3Q14 4Q14 1Q15 2Q15 3Q15 3
Slide 12: Efficiency
Efficiency 3Q15 Efficiency Ratio Sources of Competitive Advantage 64.0% 66.5% 66.7% 67.3% 67.8% • Single processing platforms 61.3% 61.6% 56.4% 58.2% 53.9% • Full consolidation of acquisitions • Operating scale in all significant businesses • Business line monthly review USB Peer 1 Peer 2 Peer 3 Pee
Slide 13: Efficiency Effort
Efficiency Effort Goals • Return to positive operating leverage • Reinvest savings into growth initiatives as economy strengthens U.S. BANCORP 13 |
Slide 14: Loan Growth
Loan Growth Prior 5 Years Prior 5 Quarters Average Balances Average Balances Year-Over-Year Growth Linked Quarter Growth 1.1% 1.0% 0.8% 0.7% 1.3% *Core 260 6.3% 260 1.6% 5.6% $241.7 0.6% 1.0% (0.6%) $250.5 6.9% $227.5 1.4% $248.0 $246.4 $246.6 $215.4 $243.9 220 4.4% 245 3.9% $201.4 $193.0 180 230 14
Slide 15: Deposit Growth
Deposit Growth Prior 5 Years Prior 5 Quarters Average Balances Average Balances Year-Over-Year Growth Year-Over-Year Growth 5.5% 5.5% 6.4% 7.4% 6.9% *Core 300 320 6.5% 6.9% $266.6 8.9% 6.3% 8.1% $289.7 260 290 7.2% $285.7 10.6% $250.5 7.4% $278.5 $275.5 $235.7 $271.0 15.4% 220 $213.2 260 10.1% $184.
Slide 16: Revenue Growth
Revenue Growth Prior 5 Years Prior 5 Quarters Year-Over-Year Change Year-Over-Year Change 2.0% 3.2% 1.9% 1.4% 1.6% *Core 22,000 6.2% 2.9% 5,500 5.7% 3.1% (3.4%) $20,288 $20,161 (2.8%) 5.3% $5,169 $5,147 $19,602 2.0% 8.9% $19,108 1.9% $5,042 $4,990 19,000 5,000 $4,906 $18,148 16,000 4,500 13,000 4,00
Slide 17: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP 17 |
Slide 18: Capital Management
Capital Management Earnings Distribution Target Capital Actions Reinvest and Share Acquisitions Dividends Repurchases • Annual dividend increased from $0.98 to $1.02 per share in 2Q15, 20 - 40% 30 - 40% 30 - 40% a 4.1% increase • Five-quarter authorization to Payout Ratio repurchase up to $3.0 billi
Slide 19: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP 19 |
Slide 20: Business Mix
Business Mix Revenue Mix Payment Services By Business Line Consumer and Small • Retail Payment Solutions Business Banking • Corporate Payment Systems • Branch Banking • Global Merchant Acquiring • Small Business Banking Payment Services • Consumer Lending • Mortgage Banking • Omnichannel Wealth Mana
Slide 21: Payment Services
Payment Services Revenue Contribution Business Line Summary to USB • Provides a full suite of payment processing services Payment Services to consumers, small businesses, corporations and merchants – a unique position versus other banks 30% Wealth Mgmt and Securities Services • Expanding internation
Slide 22: Wealth Management and Securities Services
Wealth Management and Securities Services Revenue Contribution Business Line Summary to USB • Delivers a full array of wealth management services Payment Services through differentiated service delivery models to address the needs of a broad range of clients Wealth Mgmt and • Leading provider of cor
Slide 23: Wholesale Banking and Commercial Real Estate
Wholesale Banking and Commercial Real Estate Revenue Contribution Business Line Summary to USB • Provides products and services to 90% of the Fortune Payment Services 500 and 87% of the Fortune 1,000 • Expanded loan capital markets and derivatives, Wealth Mgmt and Securities Services enhanced foreig
Slide 24: Consumer and Small Business Banking
Consumer and Small Business Banking Revenue Contribution Business Line Summary to USB • Provides a full suite of banking products and services to Payment Services consumer and small business customers across 25-state branch footprint Wealth Mgmt and Securities Services • Differentiating U.S. Bank fr
Slide 25: Omnichannel Strategy
Omnichannel Strategy Omnichannel: How the customer interacts both seamlessly and holistically across the bank All channels comprise ‘Omnichannel’ Strategic Pillars Branch Mobile Telephone The customer Online ATM U.S. BANCORP 25 |
Slide 26: Success in Digital is Foundational for Omnichannel
Success in Digital is Foundational for Omnichannel Great progress has fueled great results with more to do… Achievements: 1. Money movement & payments • Live with real time P2P • Apple / Android pay • Mobile wizard for payments 2. Application & fulfilment • Enables digital application • Online fulfi
Slide 27: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP 27 |
Slide 28: Net Interest Margin – Where Are We Today?
Net Interest Margin – Where Are We Today? Net Interest Income Key Points 3,000 4.0% • The net interest margin was $2,748 $2,799 $2,752 $2,770 $2,821 stable in 3Q15 versus 2Q15 2,750 3.5% 3.16% 3.14% • Two major headwinds are behind us 3.08% 3.03% 3.04% 2,500 3.0% Securities build for Liquidity 2,250
Slide 29: Net Interest Income Simulation – as Rates Move
Net Interest Income Simulation – as Rates Move Sensitivity of Net Interest Income Key Points 4.00% • The Company uses net interest income simulation analysis for measuring and analyzing 3.00% consolidated interest rate risk, 2.37% 2.39% 2.19% running 28 interest rate risk 2.00% 1.75% 1.68% scenarios
Slide 30: Deposit Gathering Advantages: Branch Distribution
Deposit Gathering Advantages: Branch Distribution Branch network • #4 U.S. branch network with 25 contiguous state distribution footprint • #1 in-store and on-site branch network 3Q15 Branches Metro traditional offices Community traditional offices 3,151 U.S. Bank branch offices In-Store and On-Site
Slide 31: Deposit Gathering Advantages: Digital Distribution
Deposit Gathering Advantages: Digital Distribution • 3 million active mobile users and growing • Mobile is now the most frequently accessed channel at U.S. Bank U.S. Bank ties for top spot in Forrester U.S. Bank Innovation team named #2 Research, Inc.'s 2014 U.S. Mobile for groups “shaping the futur
Slide 32: Deposit Growth Success
Deposit Growth Success Change Key Points Average Balance ($B) 3Q10 3Q15 (Annualized) Noninterest-bearing $ 39.8 $ 80.9 15.2% • Increased market share Total Savings 99.3 174.7 12.0% Low Cost Deposits $ 139.1 $ 255.6 13.0% #1 in 4 states Time 43.6 34.1 -4.8% Total Deposits $ 182.7 $ 289.7 9.7% Top 3 i
Slide 33: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP 33 |
Slide 34: 4Q15 Linked Quarter Update
4Q15 Linked Quarter Update • Loan Growth: 1-1.5% growth • Credit Quality: Modest increase in NCOs • Net Interest Margin: Relatively stable • Mortgage Fees: Lower 5-15% due to seasonality • Noninterest Expense: Expenses increasing vs. 3Q15 - seasonality 4Q15 expense vs. 3Q15: • Seasonal increase in t
Slide 35: Agenda
Agenda • Company Overview • Financial Management • Capital Management • Growth Strategies • Interest Rates • 4Q Update • Long-term Goals U.S. BANCORP 35 |
Slide 36: Long-term Goals
Long-term Goals Long-term Goals Current Status • Optimal business line mix Four simple and stable business lines • Investments generating Mortgage, wealth management, corporate positive returns banking, international payments, branch technology, internet and mobile channels, and select acquisitions
Slide 37: Appendix
Appendix U.S. BANCORP 37 |
Slide 38: Non-GAAP Financial Measures
Non-GAAP Financial Measures Line of Business Financial Performance $ in millions Revenue Line of Business Financial Performance 3Q15 YTD Wholesale Banking and Commercial Real Estate $ 2,187 Consumer and Small Business Banking 5,334 Wealth Management and Securities Services 1,370 Payment Services 3,9
Slide 39: BancAnalysts Association of Boston Conference
BancAnalysts Association of Boston Conference
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