SECURITIES AND EXCHANGE COMMISSION
Washington,WASHINGTON, D.C. 20549
Form 10-K
| | | | | |
| ☑ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES |
For the fiscal year ended December 31, 20222023
| | | | | |
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES |
period from (not applicable)
sionCommission file number:1-6880
(Exact name of registrant as specified in its charter)
| | | | | | | | |
| Delaware | | 41-0255900 |
| | |
| | |
(State or other jurisdiction of incorporation or organization) | | |
800 Nicollet Mall, Minneapolis, Minnesota 55402
(Address of principal executive offices) (Zip Code)
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | | | | | | | |
| | Trading symbols | | | Name of each exchange
|
Common Stock, $.01 par value per share | | USB | | USB | New York Stock Exchange |
Depositary Shares (each representing 1/100th interest in a share of Series ANon-Cumulative Perpetual Preferred Stock, par value $1.00) | | USB PrA | | New York Stock Exchange |
Depositary Shares (each representing 1/1,000th interest in a share of Series BNon-Cumulative Perpetual Preferred Stock, par value $1.00) | | USB PrH | | New York Stock Exchange |
Depositary Shares (each representing 1/1,000th interest in a share of Series KNon-Cumulative Perpetual Preferred Stock, par value $1.00) | | USB PrP | | New York Stock Exchange |
Depositary Shares (each representing 1/1,000th interest in a share of Series LNon-Cumulative Perpetual Preferred Stock, par value $1.00) | | USB PrQ | | New York Stock Exchange |
Depositary Shares (each representing 1/1,000th interest in a share of Series MNon-Cumulative Perpetual Preferred Stock, par value $1.00) | | USB PrR | | New York Stock Exchange |
Depositary Shares (each representing 1/1,000th interest in a share of Series ONon-Cumulative Perpetual Preferred Stock, par value $1.00) | | USB PrS | | New York Stock Exchange |
0.850% Medium-Term Notes, Series X (Senior), due June 7, 2024 | | USB/24B | | USB/24B | New York Stock Exchange |
Securities registered pursuant to Section 12(g) of the Act:
eckcheck mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
No ☑
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T
during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule
12b-2
of the Exchange Act.
| | | | | | |
Large accelerated filer | | ☑ | | Accelerated filer | | Large accelerated filer ☑ Accelerated filer ☐ |
Non-accelerated
filer | | ☐ | | Smaller reporting company | | ☐ |
Emerging growth company ☐ |
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its aud
it
☑
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐☑
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to
§240.10D-1(b) §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2
No ☑
As of June 30,
2022,2023, the aggregate market value of the registrant’s common stock held by
non-affiliates
of the registrant was
$68.4$50.6 billion based on the closing sale price as reported on the New York Stock Exchange.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.
| | | | | |
| |
| | Outstanding at January 31, 2023 |
Common Stock, $.01 par value per share | 1,558,133,431 |
Auditor Firm Id: 42 Auditor Name: Ernst & Young LLP Auditor Location: Minneapolis, Minnesota
| | | | |
Auditor Firm Id: 42 | | Auditor Name: Ernst & Young LLP | | Auditor Location: Minneapolis, Minnesota |
DOCUMENTS INCORPORATED BY REFERENCE
| | | | | | | | |
| | Parts Into Which Incorporated |
1. | | Portions of the Annual Report to Shareholders for the Fiscal Year Ended December 31, 20222023 (the “2022“2023 Annual Report”) | | Parts I and II |
2. | | Portions of the Proxy Statement for the Annual Meeting of Shareholders to be held April 18, 202316, 2024 (the “Proxy Statement”) | | Part III |
Item 1. Business
Forward-Looking Statements
THE FOLLOWING INFORMATION APPEARS IN ACCORDANCE WITH THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This report contains forward-looking statements about U.S. Bancorp (“U.S. Bancorp” or the “Company”). Statements that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements and are based on the information available to, and assumptions and estimates made by, management as of the date hereof. These forward-looking statements cover, among other things, future economic conditions and the anticipated future revenue, expenses, financial condition, asset quality, capital and liquidity levels, plans, prospects and operations of U.S. Bancorp. Forward-looking statements often use words such as “anticipates,” “targets,” “expects,” “hopes,” “estimates,” “projects,” “forecasts,” “intends,” “plans,” “goals,” “believes,” “continue” and other similar expressions or future or conditional verbs such as “will,” “may,” “might,” “should,” “would” and “could.”
Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those set forth in forward-looking statements, including the following risks and uncertainties:
•Deterioration in general business and economic conditions or turbulence in domestic or global financial markets, which could adversely affect U.S. Bancorp’s revenues and the values of its assets and liabilities, reduce the availability of funding to certain financial institutions, lead to a tightening of credit, and increase stock price volatility;
•Turmoil and volatility in the financial services industry, including failures or rumors of failures of other depository institutions, which could affect the ability of depository institutions, including U.S. Bank National Association ("USBNA"), to attract and retain depositors, and could affect the ability of financial services providers, including U.S. Bancorp, to borrow or raise capital;
•Actions taken by governmental agencies to stabilize the financial system and the effectiveness of such actions;
•Changes to regulatory capital, liquidity and resolution-related requirements applicable to large banking organizations in response to recent developments affecting the banking sector;
•Changes to statutes, regulations, or regulatory policies or practices, including capital and liquidity requirements, and the enforcement and interpretation of such laws and regulations, and U.S. Bancorp’s ability to address or satisfy those requirements and other requirements or conditions imposed by regulatory entities;
•Changes in interest rates;
•Increases in unemployment rates;
•Deterioration in the credit quality of itsU.S. Bancorp's loan portfolios or in the value of the collateral securing those loans;
•Risks related to originating and selling mortgages, including repurchase and indemnity demands, and related to U.S. Bancorp’s role as a loan servicer;
•Impacts of current, pending or future litigation and governmental proceedings;
| • | | •Increased competition from both banks and non-banks; •non-banks; |
Effects of climate change and related physical and transition risks;
•Changes in customer behavior and preferences and the ability to implement technological changes to respond to customer needs and meet competitive demands;
•Breaches in data security;
•Failures or disruptions in or breaches of U.S. Bancorp’s operational, technology or security systems or infrastructure, or those of third parties;
•Failures to safeguard personal information;
| • | | Impacts of pandemics, including the
•Impacts of pandemics, natural disasters, terrorist activities, civil unrest, international hostilities and geopolitical events; •COVID-19 pandemic, natural disasters, terrorist activities, civil unrest, international hostilities and geopolitical events; |
Impacts of supply chain disruptions, rising inflation, slower growth or a recession;
•Failure to execute on strategic or operational plans;
•Effects of mergers and acquisitions and related integration;
•Effects of critical accounting policies and judgments;
•Effects of changes in or interpretations of tax laws and regulations;
•Management’s ability to effectively manage credit risk, market risk, operational risk, compliance risk, strategic risk, interest rate risk, liquidity risk and reputation risk; and
•The risks and uncertainties more fully discussed in the section entitled “Risk Factors” of the 20222023 Annual Report.
In addition, U.S. Bancorp’s acquisition of MUFG Union Bank, N.A. (“MUB”) presents risks and uncertainties, including, among others: the risk that
the cost savings, any revenue synergies and other anticipated benefits of the acquisition may not be realized or may take longer than anticipated to be
realized; and the possibility that the combination of MUB with U.S. Bancorp, including the integration of MUB, may be more costly or difficult to complete than anticipated or have unanticipated adverse results.realized.
In addition, factors other than these risks also could adversely affect U.S. Bancorp’s results, and the reader should not consider these risks to be a complete set of all potential risks or uncertainties. Readers are cautioned not to place undue reliance on any forward-looking statements. Forward-looking statements speak only as of the date hereof, and U.S. Bancorp undertakes no obligation to update them in light of new information or future events.
General Business Description
U.S. Bancorp is a financial services holding company headquartered in Minneapolis, Minnesota, serving millions of local, national and global customers. U.S. Bancorp is registered as a bank holding company under the Bank Holding Company Act of 1956 (the “BHC Act”), and has elected to be treated as a financial holding company under the BHC Act. The Company provides a full range of financial services, including lending and depository services, cash management, capital markets, and trust and investment management services. It also engages in credit card services, merchant and ATM processing, mortgage banking, insurance, brokerage and leasing.
U.S. Bancorp’s banking
subsidiaries, U.S. Bank National Association (“USBNA”) and MUB, aresubsidiary, USBNA, is engaged in the general banking business, principally in domestic markets, and
holdholds all of the Company’s consolidated deposits of
$525.0$512.3 billion at December 31,
2022.2023. USBNA
and MUB provideprovides a wide range of products and services to individuals, businesses, institutional organizations, governmental entities and other financial institutions. Commercial and consumer lending services are principally offered to customers within the Company’s domestic markets, to domestic customers with foreign operations and to large national customers operating in specific industries targeted by the Company, such as healthcare, utilities, oil and gas, and state and municipal government. Lending services include traditional credit products as well as credit card services, lease financing and import/export trade, asset-backed lending, agricultural finance and other products. Depository services include checking accounts, savings accounts and time certificate contracts. Ancillary services such as capital markets, treasury management and receivable
lock-box collection are provided to corporate and governmental entity customers. U.S. Bancorp’s bank and trust subsidiaries provide a full range of asset management and fiduciary services for individuals, estates, foundations, business corporations and charitable organizations.
Other U.S. Bancorp
non-banking subsidiaries offer investment and insurance products to the Company’s customers principally within its domestic markets, and fund administration services to a broad range of mutual and other funds.
Banking and investment services are provided through a network of
2,4942,274 banking offices
across 26 states as of December 31,
2022,2023, principally operating in the Midwest and West regions of the United
States, through on-line3
custody and fund servicing through four businesses: Wealth Management, Global Corporate Trust & Custody, U.S. Bancorp Asset Management, and Fund Services. Wealth Management and Investment Services contributed $1.3 billion, or 22.6 percent, of the Company’s net income in 2022, an increase of $471 million (55.9 percent) compared with 2021.
Payment Services Payment Services includes consumer and business credit cards, stored-value cards, debit cards, corporate, government and purchasing card services and merchant processing. Payment Services contributed $1.3$1.2 billion or 22.7 percent, of the Company’s net income in 2022,2023, a decrease of $380$150 million (22.3(11.2 percent) compared with 2021.
2022.
Treasury and Corporate SupportTreasury and Corporate Support includes the Company’s investment portfolios, funding, capital management, interest rate risk management, income taxes not allocated to the business lines, including most investments in
tax-advantaged projects, and the residual aggregate of those expenses associated with corporate activities that are managed on a consolidated basis. Treasury and Corporate Support recorded a net loss of
$459 million, or (7.9) percent,$1.5 billion of the Company’s net income in
2022,2023, a decrease of
$2.0 billion$826 million compared with
2021.2022.
Additional information regarding the Company’s business segments can be found on pages 56 to
5958 of the Company’s
20222023 Annual Report under the heading “Line of Business Financial Review,” which is incorporated herein by reference.
The Company’s success depends, in large part, on its ability to attract, develop and retain skilled employees. The Company recognizes that supporting, engaging and continuously upskilling its workforce is key to meeting evolving corporate and customer needs. To further those efforts, the Company is dedicated to fostering a diverse, equitable and inclusive work environment; providing pay that is competitive and fair, as well as other benefits and programs that promote wellness; and supporting employees’ professional development through programs that promote engagement, learning and productivity. As of December 31,
2022,2023, the Company employed a total of
78,19275,465 employees
globally, including employees from the acquisition of MUB on December 1, 2022.globally.
Diversity, Equity and Inclusion The Company continues to expand its talent pipeline to increase the representation of women at leadership levels and people of color at all levels, including at the executive and senior management level.levels. The Company’s hiring program includesstrives to include the inclusion of at least one woman or one person of color on interview slates for all roles at the Company. In addition, the Company’s High Impact Development Program focuses on growing itsCompany offers various mentorship, leadership pipeline ofand development opportunities that enable participants, including women and people of color. This program creates increased visibilitycolor, to enhance networks, key skills and connections with executive leadership, meaningful learning and development opportunities, robust action plans and cohort networking/peer support.work experiences. The Company also provides inclusive leadership learning journeys designed to coach and develop its leaders in driving employee and team performance through inclusive behaviors and best practices. To help create and sustain an inclusive workforce, the Company sponsors Business Resource Groups (“BRGs”), including Asian heritage, Black heritage, Nosotros Latinos, Indigenous Peoples, U.S. Bank women, Spectrum LGBTQ, Proud to Serve: Military and Veterans, European Inclusion, and Disability employee groups, with chapters across the Company.Company and membership available to all employees. These BRGs enable employees from a wide variety of backgrounds, identities and perspectives to connect in ways that empower them to contribute, innovate and grow. Through these BRGs, employees can come together to discuss topics of interest to them, develop professional skills and build overall employee engagement,
helping to create and sustain an inclusive workforce that drives business growth and propels accountability for diversity and inclusion within the Company.
These programs, practices and policies are part of the Company’s strategy to have an ethnically and gender diverse employee base. As of December 31,
2022,2023, of the Company’s employees in the United States,
5
and its implementing regulations (collectively, the “CCPA”). The CCPA gives consumers several rights with respect to their personal information, including the right to (i) know the information that has been collected about them and whether that information has been sold or shared with others; (ii) request deletion of their personal information (subject to certain exceptions); (iii) opt out of the sale of their personal information; and (iv) not be discriminated against for exercising these rights. The CCPA contains several exemptions to the CCPA’s requirements, including an exemption for personal information that is subject to the GLBA. The CCPA also provides residents of California (regardless of whether their information is covered under the GLBA exemption) with a limited private right of action, including the right to seek statutory damages, against businesses that fail to implement and maintain reasonable security procedures and practices and the failure results in the unauthorized access and exfiltration, theft, or disclosure of certain types of the California residents’ personal information. In November 2020, voters in the State of California approved the California Privacy Rights Act (“CPRA”), a ballot measure that amends and supplements the CCPA by, among other things, expanding certain rights relating to personal information and its use, collection, and disclosure by covered businesses. While the CPRA’s substantive amendments to the CCPA took effect on January 1, 2023, the process of providing implementing regulations for those amendments is ongoing, with finalized regulations not expected until months after the amendments’ effective date. In addition, similar laws have been adopted by other states where the Company does business, including the Colorado Privacy Act, the Connecticut Act Concerning Personal Data Privacy and Online Monitoring of 2022, the Utah Consumer Privacy Act and the Virginia Consumer Data Protection Act. Each of these state laws, however, includes an entity level exemption for “financial institutions” like the Company. The Company has made and will make operational adjustments in accordance with the requirements of applicable privacy and data protection laws. For example, the Company is subject to the California Consumer Protection Act of 2018 and its implementing regulations, as amended in 2020 by the California Privacy Rights Act (the "CCPA"), which provided residents of California with specific rights with respect to the collection of their personal information. The process of drafting and finalizing implementing regulations for the CCPA is ongoing. The Company continues to evaluate the new regulations, and the effects on the Company will depend on the form of any additional rulemakings.
Similar comprehensive consumer privacy laws have been adopted by other states where the Company does business. Each of these state laws, however, includes an entity level exemption for “financial institutions” that are subject to the GLBA like the Company. The United States Congress has also proposed legislation relating to data privacy and data protection, and the federal government may in the future pass such legislation.
In addition, in the European Union (“EU”), privacy law is governed by the General Data Protection Regulation (“GDPR”), which is directly binding and applicable in each EU member state. The GDPR contains enhanced compliance obligations and increased penalties for
non-compliance compared to the prior law governing data privacy in the EU and is regularly enforced by European regulators.
Canada is in the process of replacing its federal privacy law, the Personal Information Protection and Electronic Documents Act, with a new privacy framework that the Company expects will impose additional compliance obligations on the Company’s Canadian operations.
In October 2023, the CFPB issued a proposed rule regarding personal financial data rights that would apply to financial institutions that offer consumer deposit accounts and credit card issuers. Under the proposed rule, USBNA would be required to provide consumers and their authorized third parties electronic access to 24 months of transaction data, certain account information, account balance, upcoming bill information, information to initiate payment to and from accounts, and the terms and conditions under which an account or credit card was provided. USBNA would be prohibited from imposing any fees or charges for maintaining or providing access to such data. USBNA would also be obligated to comply with data accuracy, retention and other requirements contained in the proposed rule. The Company continues to evaluate the proposed rule, and the impact on USBNA and the Company will depend on the final form of any rulemaking.
Like other lenders, USBNA MUB and other subsidiaries of the Company use consumer reports in their underwriting activities. Use of such information is regulated under the Fair Credit Reporting Act (“FCRA”), and the FCRA also regulates
reporting information to consumer reporting agencies, prescreening individuals for credit offers, sharing of consumer reports between affiliates, and using affiliate credit data for marketing purposes. Similar state laws may impose additional requirements on the Company and its subsidiaries.
A significant overhaul of the FCRA is expected to be issued in the first half of 2024, which will impact USBNA and its subsidiaries.
The federal banking regulators, as well as the SEC, CFPB, CFTC, and related self-regulatory organizations, regularly issue guidance on cybersecurity that is intended to enhance cyber risk management among financial institutions. A financial institution’s management is required to maintain sufficient business continuity planning processes to ensure the rapid recovery, resumption and maintenance of the institution’s operations after a cybersecurity incident. A financial institution is also expected to develop appropriate processes to enable recovery of data and business operations if the institution or its critical service providers experience a cybersecurity incident.
In November 2021, the United States federal bank regulatory agencies adopted a rule regarding notification requirements for banking organizations related to significant
computer securitycomputer-security incidents. Under the final rule, which was effective April 1, 2022, a
BHC,banking organization, such as the Company and
a national bank, such as USBNA,
or MUB, is required to notify
the Federal Reserve or OCC, respectively,their primary federal regulator within 36 hours of a
computer securitycomputer-security incident that results in actual harm to the confidentiality, integrity, or availability of an information system or the information that the system processes, stores or transmits, which has materially disrupted or degraded, or is reasonably likely to materially disrupt or degrade, the banking organization’s ability to deliver services to a material portion of its customer base, jeopardize the viability of key operations of the banking organization, or impact the stability of the financial sector. Similarly, the Office of the Superintendent of Financial Institutions in Canada requires Federally Regulated Financial Institutions to report qualifying technology and cybersecurity incidents under the provisions of the August 13, 2021 Technology and Cyber Security Incident Reporting Advisory.
18
In October 2022, the SEC adopted a final rule directing national securities exchanges and associations, including the New York Stock Exchange (the “NYSE”), to implement listing standards that require all listed companies to adopt policies mandating the recovery or “clawback” of excess incentive-based compensation earned by a current or former executive
officer during the three fiscal years preceding a required accounting restatement, including to correct an error that would result in a material misstatement if the error were corrected in the current period. The excess compensation would be based on the amount the executive officer would have received had the incentive-based compensation been determined using the restated financial statements. The
NYSE and other exchanges issued proposed standards in February 2023, which were approved by the SEC in June 2023. The final
rule requires the exchanges to propose conforming listing standards
by February 26,became effective on October 2, 2023 and
requires the standards to become effective no later than November 23, 2023. Each listed issuer, including the Company
would then be required to adoptadopted a clawback policy within 60 days after
its exchange’sthe NYSE's listing standard
has become effective.became effective, in compliance with the NYSE's listing standard.
Climate-Related Financial Risk Management In October 2023, the United States federal banking agencies issued a set of principles relating to the management of climate-related financial risks. The principles apply to banking organizations with over $100 billion in total consolidated assets, including the Company and USBNA. The principles are intended to provide a framework for large banking organizations to guide their efforts to identify, measure, monitor, and mitigate physical and transition risks associated with climate change. Among other guidance, the principles describe how climate-related financial risks can be addressed in connection with specific risk categories, including credit risk, liquidity risk, operational risk, and legal and compliance risk.
Other Supervision and Regulation The As a public company, the Company is subject to the disclosure and regulatory requirements of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), bothand the rules and regulations promulgated by the SEC thereunder, as administered by the SEC, by virtue of the Company’s status as a public company.SEC. As a listed company on the NYSE, the Company is subject to the rules of the NYSE for listed companies. The Company has entered into several transactions involving the issuance of capital securities (“Capital Securities”) by certain Delaware statutory trusts formed by the Company (the “Trusts”), the issuance by the Company of preferred stock (“Preferred Stock”) or the issuance by a subsidiary of USBNA of preferred stock exchangeable for the Company’s Preferred Stock under certain circumstances (“Exchangeable Preferred Stock”). Simultaneously with the closing of certain of those transactions, the Company entered into a replacement capital covenant, as amended from time to time (as amended, each, a “Replacement Capital Covenant” and collectively, the “Replacement Capital Covenants”) for the benefit of persons that buy, hold or sell a specified series of long-term indebtedness of the Company or USBNA (the “Covered Debt”). Each of the Replacement Capital Covenants provides that neither the Company nor any of its subsidiaries (including any of the Trusts) will repay, redeem or purchase any of the Preferred Stock, Exchangeable Preferred Stock or the Capital Securities and the securities held by the Trust (the “Other Securities”), as applicable, on or before the date specified in the applicable Replacement Capital Covenant, unless the Company has received proceeds from the sale of qualifying securities that (a) have equity-like characteristics that are the same as, or more equity-like than, the applicable characteristics of the Preferred Stock, the Exchangeable Preferred Stock, the Capital Securities or Other Securities, as applicable, at the time of repayment, redemption or purchase, and (b) the Company has obtained the prior approval of the Federal Reserve, if such approval is then required by the Federal Reserve or, in the case of the Exchangeable Preferred Stock, the approval of the OCC.
The Company will provide a copy of any Replacement Capital Covenant to a holder of the relevant Covered
Debt.Debt upon request. For copies of any of these documents, holders should write to Investor Relations, U.S. Bancorp, 800 Nicollet Mall, Minneapolis, Minnesota 55402, or call
(866) 775-9668.20
The following table identifies the closing date for each transaction, issuer, series of Capital Securities, Preferred Stock or Exchangeable Preferred Stock issued in the relevant transaction, Other Securities, if any, and applicable Covered Debt as of February
27, 2023,20, 2024, for those securities that remain outstanding.
| | | | | | | | | | | | | | |
Closing Date | Issuer | Capital Securities, Preferred Stock
or Exchangeable Preferred Stock | Other Securities | | | | | Covered Debt |
Closing
Date
| | Issuer
| | Capital Securities or
Preferred Stock
| | Other Securities
| | Covered Debt
|
3/17/06 | | U.S. Bancorp | | USB Capital IX’s $675,378,000 of 6.189% Fixed-to-Floating Rate Normal Income Trust Securities | | U.S. Bancorp’s Series A Non-Cumulative Perpetual Preferred Stock | | U.S. Bancorp’s 7.50% Subordinated Debentures due 2026 (CUSIP No. 911596AL8) |
| | | | |
3/27/06 | | U.S. Bancorp | | U.S. Bancorp’s 40,000,000 Depositary Shares ($25 per Depositary Share) each representing a 1/1000th interest in a share of Series B Non-Cumulative Perpetual Preferred Stock | | Not Applicable | | U.S. Bancorp’s 7.50% Subordinated Debentures due 2026 (CUSIP No. 911596AL8) |
| | | | |
12/22/06 | | Corp.(a) and U.S. Bancorp | | USB Realty Corp.’s 4,500 shares of Fixed-to-Floating-Rate Exchangeable Non-Cumulative Perpetual Series A Preferred Stock exchangeable for shares of U.S. Bancorp’s Series C Non-Cumulative Perpetual Preferred Stock(b) | | Not Applicable | | U.S. Bancorp’s 7.50% Subordinated Debentures due 2026 (CUSIP No. 911596AL8) |
| (a) | USB Realty Corp. is a subsidiary of USBNA.
|
|
(b) | Under certain circumstances, upon the direction of the OCC, each share of USB Realty Corp.’s Series A Preferred Stock will be automatically exchanged for one share of U.S. Bancorp’s Series C Non-Cumulative Perpetual Preferred Stock.
|
21
(a) USB Realty Corp. is a subsidiary of USBNA.
(b) Under certain circumstances, upon the direction of the OCC, each share of USB Realty Corp.’s Series A Preferred Stock will be automatically exchanged for one share of U.S. Bancorp’s Series C Non-Cumulative Perpetual Preferred Stock.
U.S. Bancorp’s internet website can be found at www.usbank.com. U.S. Bancorp makes available free of charge on its website, by clicking on “About us” and then clicking on “Investor
relations,”relations” and then clicking on "SEC & Other Filings," its annual reports on Form
10-K, quarterly reports on Form
10-Q, current reports on
Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13 or 15(d) of the Exchange Act, as well as all other reports filed by U.S. Bancorp with the SEC as soon as reasonably practicable after electronically filed with, or furnished to, the SEC.
Additional information in response to this Item 1 can be found in the
20222023 Annual Report on pages 56 to
5958 under the heading “Line of Business Financial Review.” That information is incorporated into this report by reference.
Item 1A. Risk Factors
Information in response to this Item 1A can be found in the
20222023 Annual Report on pages 140 to 155 under the heading “Risk Factors.” That information is incorporated into this report by reference.
Item 1B. | Unresolved Staff Comments
|
Item 1B. Unresolved Staff Comments
Item 1C. Cybersecurity
The Company is committed to managing risks that may impact the Company and incorporating risk considerations into its business activities at all levels, including strategic planning, risk identification inventory and assessment, and day-to-day business decisions. The Company’s Board of Directors has approved a risk management framework that establishes governance and risk management requirements for all the Company’s key risk areas and risk-taking activities. The Board oversees management’s performance relative to the risk management framework and risk appetite. Management is responsible for defining the various risks facing the Company, formulating risk management policies and procedures, and managing risk exposures on a day-to-day basis. The Company’s Executive Risk Committee (ERC), which is chaired by the Chief Risk Officer, oversees execution of the risk management framework. The ERC is supported by management’s senior operating committees, each responsible for a specified risk category. The Company’s Information Security Risk Committee
(ISRC), which is co-chaired by the Chief Information Security Officer (CISO) and the Chief Technology Risk Officer, is a senior operating committee under this risk governance structure and is responsible for the management of information security risk at the Company. The ISRC provides direction and oversight of the information security risk management framework and corporate control programs of the Company, including significant information security risk events, and mitigation strategies. Further, the ISRC facilitates communication across business lines to provide for effective and consistent information security risk identification and control infrastructure to mitigate and manage material information security risks. The ISRC serves as an escalation, decision making, and approval body for information security risk items, including key policies and programs, issue resolution, emerging risks, and key program adherence. The ISRC escalates matters as appropriate to executive management, the ERC, which reports to the Board’s Risk Management Committee, or a relevant committee of the Board. Generally, each of the ERC and ISRC meet at least monthly.
As part of the Company’s risk management framework, risk management programs and processes are in place to incorporate risk considerations into day-to-day business activities across the Company’s risk categories, business lines, and functions. Risk programs may manage all or certain components of a particular risk type. The Company’s cybersecurity risk program provides centralized planning and management of related and interdependent work with a focus on risks from cybersecurity threats. The Company’s cybersecurity risk program is integrated into the Company’s overall business and operational strategies and requires that the Company allocate appropriate resources to maintain the program.
The Company’s processes for assessing, identifying, and managing material risks from cybersecurity threats is integrated into the Company’s overall risk governance and oversight structures through its “three lines of defense” model for establishing effective checks and balances within the risk management framework. In this model, specific to cybersecurity threats, the first line of defense is Information Security Services (ISS), which is responsible for identifying and implementing cybersecurity controls in accordance with policy requirements and industry best practices, to meet regulatory requirements and to safeguard the business. The second line of defense, Cybersecurity Risk Oversight within the Company's Operational Risk Management group, provides reporting and escalation of emerging risks related to cybersecurity and other concerns to senior management, the ERC, the ISRC, other designated senior operating committees, and the Risk Management Committee of the Board of Directors. The third line of defense, the Company’s internal audit function, provides independent assessment and assurance regarding the effectiveness of the Company’s governance, risk management, and control processes with respect to cybersecurity threats, and provides challenge and recommendations for improvement.
The Company uses reporting and metrics frameworks and regular internal and external oversight to assess the health of the cybersecurity risk program. At the first level, the ISS team identifies, assesses, and manages cybersecurity risk and threats. The Company manages cybersecurity issues and findings through remediation and/or closure, with escalation processes if an issue or finding cannot be remediated within required timeframes. The Company engages external assessors, consultants, and auditors to review the Company’s cybersecurity risk program against those of industry peers. The Company also uses consultants periodically to provide recommendations to improve and enhance the program. Additionally, the Company continually works to align its policies and practices with industry-accepted information security practices as provided by the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF), Payment Card Industry Data Security Standards (PCI DSS), and other applicable standards, laws, and regulations.
The Company also maintains a third-party risk management program responsible for the oversight of outsourced operations, which enables the Company to oversee and identify risks related to engaging third-party service providers, including risks from cybersecurity threats to third-party service providers. The Company conducts due diligence using a risk-based approach in selecting and monitoring third-party service providers. The Company also obtains contractual assurances from third-party service providers relating to their security responsibilities, controls, reporting, and roles and responsibilities as it pertains to cybersecurity incident response policies and notification requirements. As appropriate, the Company obtains independent reviews of the third parties’ security through audit reports and testing and conducts verification and validation with third parties to confirm cybersecurity and information security risks are appropriately identified, measured, mitigated, monitored, and reported by the third party to the Company.
As part of its responsibility to oversee the management, business, and strategy of the Company, the Company’s Board of Directors reviews and approves the Company’s risk management framework annually through its Risk Management Committee and oversees the Company’s risk management processes by informing itself about the Company’s key risks and evaluating whether management has reasonable risk management and control processes in place to address those risks. The Board carries out its risk management oversight responsibilities primarily through its committees. Each Board committee is responsible for overseeing certain risks under its charter. The Board’s Risk Management Committee, with support from its Cybersecurity and Technology Subcommittee, has primary oversight responsibility for cybersecurity risk, including risks from any cybersecurity threats. The Risk Management Committee monitors the Company’s compliance with the risk management framework and risk limits established under the Company’s risk appetite statement approved by the Board. The Risk Management Committee also oversees the Company’s independent risk management function. The Board’s Risk Management Committee has a Cybersecurity and Technology Subcommittee that provides dedicated oversight to
cybersecurity risk management and cyber resiliency and certain technology matters. The Risk Management Committee and its Cybersecurity and Technology Subcommittee receive quarterly reports from management on cybersecurity issues, including cybersecurity threats. The Board’s Risk Management Committee and Audit Committee also hold a joint meeting annually at which they receive a report from the Company’s CISO on cybersecurity threats facing the Company and its preparedness to meet and respond to those threats. In addition, the full Board typically holds an annual cybersecurity education session, which features the perspective of an outside expert on current cybersecurity topics. The Company also typically conducts an annual executive-level cybersecurity exercise to test its cyber incident response, completeness of playbooks, and communication protocols. This exercise involves Board members, managing committee members, third-party companies, and regulators as appropriate.
The Company’s risk management framework includes its risk appetite statement, which is approved annually by the Board’s Risk Management Committee and defines acceptable levels of risk-taking and risk limits and establishes the governance and oversight activities over risk management and reporting. Management monitors and measures the Company’s risk appetite using a quantitative risk scorecard, which consists of risk appetite metrics and associated limits reported to the Board’s Risk Management Committee on a quarterly basis. The Company’s risk appetite statement includes specific information security metrics and associated limits. These limits also inform how matters, including cybersecurity incidents or threats, are escalated to specific members of management, appropriate senior operating committee (including the ISRC and/or ERC), and/or the Board of Directors or appropriate Board committee. The Board’s Risk Management Committee oversees the Company’s risk profile relative to its risk appetite and compliance with risk limits.
The members of the Company’s management that are primarily responsible for assessing and managing risks from cybersecurity threats, including monitoring risk appetite metrics and limits related to cybersecurity, include the Company’s CISO, Chief Risk Officer, and Chief Information and Technology Officer.
The Company’s CISO is primarily responsible for the implementation of defense capabilities and risk mitigation strategies. The Company’s CISO, Timothy J. Held, has over 26 years of information technology and cybersecurity experience. He holds the title of Executive Vice President and Chief Information Security Officer and has been in his role since 2018, having served as the Company’s Deputy CISO from 2015 to 2018 and Head of Cyber Defense, Threat Intelligence, and Incident Response from 2012 to 2018. The CISO is supported by his direct reports and their teams, many of whom hold cybersecurity-related certifications.
The Company’s CISO reports to the Vice Chair and Chief Risk Officer, Jodi L. Richard, who has served in that position since October 2018. She served as Executive Vice President and Chief Operational Risk Officer of the Company from January 2018 until October 2018, having served as Senior Vice President and Chief Operational Risk Officer from 2014 until January 2018. Prior to that time, Ms. Richard held various senior leadership roles at HSBC from 2003 until 2014, including Executive Vice President and Head of Operational Risk and Internal Control at HSBC North America from 2008 to 2014.
Venkatachari Dilip, the Company’s Senior Executive Vice President and Chief Information and Technology Officer, has oversight of technology-related risk management issues and controls that align to the NIST CSF. Mr. Dilip previously was an Executive Vice President from September 2018 to April 2023 and has served as Chief Information and Technology Officer since joining the Company in September 2018. From May 2014 until July 2017, he served as Vice President at McKinsey Digital where he helped banks accelerate their digital transformation. From April 2009 to September 2013, he served as CEO at Compass Labs leading an innovative marketing analytics company. From March 2006 until April 2008, he served as Director of Products at Google where he led product teams for mobile ads and Google Checkout. From March 2004 until March 2006, he served as Vice President of PayPal/eBay and on the Board of PayPal Europe, where he was responsible for Payments Services, Risk and Fraud Management. Previously, Mr. Dilip co-founded and led startup companies CashEdge and CommerceSoft from 1996 until 2003.
The CISO and his leadership team generally meet each business day to discuss security item triage and emerging threats and trends identified by the Threat Intelligence Team. The CISO shares pertinent information from those meetings with the Chief Risk Officer. During a cyber incident, which could involve the Company or a third-party service provider to the Company, the Company’s Cyber Security Incident Response Team (CSIRT) leads the response and internal communication. CSIRT manages low and moderate severity incidents, and Enterprise Crisis Management manages high and very high severity incidents. The risk rating of an incident may change throughout the incident investigation period as new information is learned or the environment changes. Depending on severity level, CSIRT or Enterprise Crisis Management distributes incident communications to senior management, including the Chief Executive Officer, Chief Risk Officer, Board of Directors or appropriate Board committee, and if applicable, the Company’s regulators.
ISS leadership reports prevention, detection, mitigation, and remediation activities through various working groups and committees. Certain working groups meet with the CISO monthly to review completed risk assessments, and items that require escalation are reported up using the internal committee structure and ad hoc communications if time sensitive.
Additionally, working group and committee meetings report up issues to Operational Risk Management, which may decide to open a formal Risk Management Issue (RMI) based on the severity of the issue or other factors and which are subject to specific governance processes. All security-related RMI remediation activities are reviewed with the Chief Risk Officer and Chief Information and Technology Officer on a bi-weekly basis.
During the fiscal year ended December 31, 2023, the Company has not identified any specific risks from cybersecurity threats that have materially affected, or are reasonably likely to affect, the Company’s business strategy, results of operations, or financial condition, other than the risks described under “Risk Factors – Operations and Business Risk” in the 2023 Annual Report.
Item 2. Properties
U.S. Bancorp and its significant subsidiaries occupy headquarter offices under a long-term lease in Minneapolis, Minnesota. The Company also leases
75 freestanding operations centers in
Cincinnati, Denver, Milwaukee,Kansas City, Little Rock, Atlanta, Minneapolis
Chicago, Portland and
St. Paul.Chicago. The Company owns 8 principal operations centers in Cincinnati, Fargo,
Milwaukee,Knoxville, Oshkosh, Olathe, Owensboro, Portland
St. Louis and St. Paul. At December 31,
2022,2023, the Company’s subsidiaries owned and operated a total of
1,2741,219 facilities and leased an additional
1,7171,576 facilities. The Company believes its current facilities are adequate to meet its needs. Additional information with respect to the Company’s premises and equipment is presented in Note 9 of the Notes to Consolidated Financial Statements included in the
20222023 Annual Report. That information is incorporated into this report by reference.
Item 3. Legal Proceedings
Information in response to this Item 3 can be found in Note 23 of the Notes to Consolidated Financial Statements included in the
20222023 Annual Report under the heading, “Litigation and Regulatory Matters.” That information is incorporated into this report by reference.
Item 4. | Mine Safety Disclosures
|
Item 4. Mine Safety Disclosures
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Item 5.
| Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
The Company announced on December 22, 2020 that its Board of Directors had approved an authorization to repurchase $3.0 billion of its common stock beginning January 1, 2021, and repurchased $1.5 billion of its common stock during the first six months of 2021 under this program.2021. The Company suspended all common stock repurchases at the beginning of the third quarter of 2021, except for those done exclusively in connection with its stock-based compensation programs, due to its acquisition of MUB. The Company does not expect to commence repurchasingwill evaluate its common stock until after its common equity tier 1share repurchases in connection with the potential capital ratio approximates 9.0 percent, at which timerequirements given the Company will assess its capital position relative to existing and proposed regulatory capital rules and related landscape. Capital distributions, including dividends and stock repurchases, are subject to the approval of the Company’s Board of Directors and compliance with regulatory requirements.The following table provides a detailed analysis of all shares repurchasedof common stock of the Company purchased by the Company or any affiliated purchaser during the fourth quarter of 2022:
| | | | | | | | | | | | | | | | |
Period | | Total Number
of Shares
Purchased | | | Average
Price Paid
per Share | | | Total Number of
Shares Purchased as
Part of Publicly
Announced Program | | | Approximate Dollar Value
of Shares that May
Yet Be Purchased
Under the Program
(In Millions) | |
October 1-31 | | | 130,208 | (a) | | $ | 42.71 | | | | 10,208 | | | $ | 1,389 | |
November 1-30 | | | 37,105 | (b) | | | 43.00 | | | | 7,105 | | | | 1,388 | |
December 1-31 | | | 294,684 | | | | 43.30 | | | | 294,684 | | | | 1,376 | |
| | | | | | | | | | | | | | | | |
Total | | | 461,997 | (c) | | $ | 43.10 | | | | 311,997 | | | $ | 1,376 | |
| | | | | | | | | | | | | | | | |
(a) | Includes 120,000 shares of common stock purchased, at an average price per share of $42.84, in open-market transactions by USBNA, the Company’s primary banking subsidiary, in its capacity as trustee of the U.S. Bank 401(k) Savings Plan, which is the Company’s employee retirement savings plan.
|
(b) | Includes 30,000 shares of common stock purchased, at an average price per share of $42.98, in open-market transactions by USBNA in its capacity as trustee of the U.S. Bank 401(k) Savings Plan.
|
(c) | Includes 150,000 shares of common stock purchased, at an average price per share of $42.87, in open-market transactions by USBNA in its capacity as trustee of the U.S. Bank 401(k) Savings Plan.
|
2023:
| | | | | | | | | | | | | | | | | |
| Period | Total Number of Shares Purchased | | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Program | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (In Millions) |
| October 1-31 | 273,451 | (a) | $36.08 | | 13,451 | $1,330 | |
| November 1-30 | 4,183 | | 37.20 | | 4,183 | 1,330 | |
| December 1-31 | 359,226 | | 45.31 | | 359,226 | 1,314 | |
| Total | 636,860 | (a) | $41.29 | | 376,860 | $1,314 | |
(a)Includes 260,000 shares of common stock purchased, at an average price per share of $36.34, in open-market transactions by USBNA, the Company’s banking subsidiary, in its capacity as trustee of the U.S. Bank 401(k) Savings Plan, which is the Company’s employee retirement savings plan.
Additional information in response to this Item 5 can be found in the
20222023 Annual Report on page 139 under the heading “U.S. Bancorp Supplemental Financial Data (Unaudited)
” and in Item 12 of this report, under the heading “Equity Compensation Plan Information..” That information is incorporated into this report
and this Item by reference.
Item 6. [Reserved]
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Information in response to this Item 7 can be found in the
20222023 Annual Report on pages 22 to
5958 under the heading “Management’s Discussion and Analysis.” That information is incorporated into this report by reference.
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk
|
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Information in response to this Item 7A can be found in the
20222023 Annual Report on pages 35 to
5655 under the heading “Corporate Risk Profile.” That information is incorporated into this report by reference.
23
Item 8. | Financial Statements and Supplementary Data
|
Item 8. Financial Statements and Supplementary Data
Information in response to this Item 8 can be found in the
20222023 Annual Report on pages
6564 to 139 under the headings “Report of Management,” “Report of Independent Registered Public Accounting Firm,” “Report of Independent Registered Public Accounting Firm,” “U.S. Bancorp Consolidated Balance Sheet,” “U.S. Bancorp Consolidated Statement of Income,” “U.S. Bancorp Consolidated Statement of Comprehensive Income,” “U.S. Bancorp Consolidated Statement of Shareholders’ Equity,” “U.S. Bancorp Consolidated Statement of Cash Flows,” “Notes to Consolidated Financial Statements,” “U.S. Bancorp Consolidated Daily Average Balance Sheet and Related Yields and Rates (Unaudited)” and “U.S. Bancorp Supplemental Financial Data (Unaudited)
.”
. That information is incorporated into this report by reference.
The consolidated financial statements included in the 2023 Annual Report reflect a correction of a transposition error of the previously reported December 31, 2022 carrying amount of loans in Note 22. The correct amount was reflected in the Consolidated Balance Sheet and other disclosures of the carrying amount of loans in the Company's previously reported consolidated financial statements as of and for the year ended December 31, 2022. The correction in Note 22 had no other impact on the consolidated financial statements.
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9A. | Controls and Procedures
|
Item 9A. Controls and Procedures
Information in response to this Item 9A can be found in the
20222023 Annual Report on page
6463 under the heading “Controls and Procedures” and on pages
6564 and
6965 under the headings “Report of Management” and “Report of Independent Registered Public Accounting Firm.” That information is incorporated into this report by reference.
Item 9B. | Other Information
|
Item 9B. Other Information
None.
Item 9C. | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
|
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Item 10. | Directors, Executive Officers and Corporate Governance
|
Item 10. Directors, Executive Officers and Corporate Governance
Code of Ethics and Business Conduct
The Company has adopted a Code of Ethics and Business Conduct that applies to its principal executive officer, principal financial officer and principal accounting officer. The Company’s Code of Ethics and Business Conduct can be found at www.usbank.com by clicking on “About us” and then clicking on “Investor relations” and then clicking on “Corporate Governance” and then clicking on “Governance documents” and then clicking on “Code of Ethics” and then clicking on “Code of Ethics and Business Conduct.” The Company intends to satisfy the disclosure requirements under Item 5.05 of Form
8-K regarding amendments to, or waivers from, certain provisions of the Code of Ethics and Business Conduct that apply to its principal executive officer, principal financial officer and principal accounting officer by posting such information on its website, at the address and location specified above.
Information About the Company’s Managing Committee(1)1
Mr. Cecere is Chairman, President and Chief Executive Officer of U.S. Bancorp. Mr. Cecere,
62,63, has served as President of U.S. Bancorp since January 2016, Chief Executive Officer since April 2017 and Chairman since April 2018. He also served as Vice Chairman and Chief Operating Officer from January 2015 to January 2016 and was U.S. Bancorp’s Vice Chairman and Chief Financial Officer from February 2007 until January 2015. Until that time, he served as Vice Chairman, Wealth Management and Investment Services, of U.S. Bancorp since the merger of Firstar Corporation and U.S. Bancorp in February 2001. Previously, he had served as an executive officer of the former U.S. Bancorp, including as Chief Financial Officer from 2000 through 2001.
Mr. Badran is Senior Executive Vice President and Chief Operations Officer of U.S. Bancorp. Mr. Badran,
58,59, has served in this position since joining U.S. Bancorp in December 2022. From January 2019 until November 2022, he served as Executive Vice President and Chief Operating Officer at Northwestern Mutual, having also served as Chief Innovation Officer from January 2019 until September 2019. Previously Mr. Badran served as President of Alibaba’s Alipay business in the Americas from August 2016 until August 2018. From 2015 to 2016, Mr. Badran served as CEO at Edo Interactive, and from 2011 to 2015, he served as Senior Vice President and General Manager at Digital River.
Mr. Barcelos is Senior Executive Vice President and Chief Human Resources Officer of U.S. Bancorp. Mr. Barcelos,
52,53, has served in this position since joining U.S. Bancorp in September 2020. From April 2018 until August 2020, he served as Senior Vice President and Chief People and Places Officer of the Federal National Mortgage Association (Fannie Mae), having served as Senior Vice President, Human Resources of the DXC Technology Company from April 2017 to March 2018. Previously, Mr. Barcelos served as Senior Vice President and Head of Human Resources for the Enterprise Services business of Hewlett Packard Enterprise Company from June 2015 to April 2017, and in other human resources senior leadership positions at Hewlett-Packard Company and Hewlett Packard Enterprise Company from July 2009 to June 2015. He previously served in various leadership roles at Wells Fargo and Bank of America.
(1) | This section includes the biographies of the members of the Managing Committee of U.S. Bancorp. Each member of the Managing Committee, except for Gregory G. Cunningham, Venkatachari Dilip and Dominic V. Venturo, is deemed to be an executive officer of U.S. Bancorp.
|
25
Mr. Chosy is Senior Executive Vice President and General Counsel of U.S. Bancorp. Mr. Chosy,
59,60, has served in this position since March 2013. He also served as Corporate Secretary of U.S. Bancorp
from June 2022 until December 2023 and from March 2013 until April 2016. From 2001 to 2013, he served as the General Counsel and Secretary of Piper Jaffray Companies. From 1995 to 2001, Mr. Chosy was Vice President and Associate General Counsel of U.S. Bancorp, having also served as Assistant Secretary of U.S. Bancorp from 1995 through 2000 and as Secretary from 2000 until 2001.
Mr. Cunningham is Senior Executive Vice President and Chief Diversity Officer of U.S. Bancorp. Mr. Cunningham, 59,60, has served in this position since July 2020. From July 2019 until July 2020, he served as Senior Vice President and Chief Diversity Officer of U.S. Bancorp, having served as Vice President of Customer Engagement of U.S. Bancorp from October
1 This section includes the biographies of the members of the Managing Committee of U.S. Bancorp. Each member of the Managing Committee, except for Gregory G. Cunningham, Revathi N. Dominski, Stephen L. Philipson and Dominic V. Venturo, is deemed to be an executive officer of U.S. Bancorp.
2015, when he joined U.S. Bancorp, until July 2019. Previously, Mr. Cunningham served in various roles in the marketing department of Target Corporation from January 1998 until March 2015.
Vankatachari
Mr. Dilip is
Senior Executive Vice President and
Global Chief Information and Technology Officer of U.S. Bancorp. Mr. Dilip,
63,64, previously was an Executive Vice President from September 2018 to April 2023 and has served
in this positionas Chief Information and Technology Officer since September 2018, when he joined U.S. Bancorp. From May 2014 until July 2017, he served as Vice President at McKinsey Digital where he helped banks accelerate their digital transformation. From April 2009 to September 2013, he served as CEO at Compass Labs leading an innovative marketing analytics company. From March 2006 until April 2008, he served as Director of Products at Google where he led product teams for mobile ads and Google Checkout. From March 2004 until March 2006, he served as Vice President of PayPal/eBay and on the Board of PayPal Europe, where he was responsible for Payments Services, Risk and Fraud Management. Previously, Mr. Dilip
co-founded and led startup companies CashEdge and CommerceSoft from 1996 until 2003.
Mr. Dolan is
Vice Chair and Chief Administration Officer of U.S. Bancorp. Mr. Dolan, 62, has served in this position since September 2023. From August 2016 to August 2023, he served as Vice Chair and Chief Financial Officer of U.S. Bancorp.
Mr. Dolan, 61, has served in this position since August 2016. From July 2010 to July 2016, he served as Vice Chair, Wealth Management and Investment Services, of U.S. Bancorp. From September 1998 to July 2010, Mr. Dolan served as U.S. Bancorp’s Controller. He additionally held the title of Executive Vice President from January 2002 until June 2010 and Senior Vice President from September 1998 until January 2002.
Revathi N. Dominski
Ms. Dominski is Senior Executive Vice President and Chief Social Responsibility Officer of U.S. Bancorp and President of the U.S. Bank Foundation. Ms. Dominski, 53, has served as Senior Executive Vice President and Chief Social Responsibility Officer since April 2023. She joined U.S. Bancorp in June 2015 as President of the U.S. Bank Foundation and Senior Vice President of Corporate Social Responsibility. Before joining U.S. Bancorp, Ms. Dominski spent 21 years with Target Corporation in leadership positions including sourcing, merchandising, merchandise planning and operations before moving to Target's Corporate Social Responsibility team, where she served as Senior Director of Education and Community Relations.
Ms. Kedia is Vice Chair, Wealth, Corporate, Commercial and Institutional Banking, of U.S. Bancorp. Ms. Kedia, 53, has served in this position since June 2023. From December 2016 to June 2023, she served as Vice Chair, Wealth Management and Investment Services, of U.S. Bancorp. Ms. Kedia, 52, has served in this position since joining U.S. Bancorp in December 2016. From October 2008 until May 2016,2016, she served as Executive Vice President of State Street Corporation where she led the core investment servicing business in North and South America and served as a member of State Street’s management committee, its senior most strategy and policy committee. Previously, Ms. Kedia was an Executive Vice President of global product management at Bank of New York Mellon from 2004 to 2008 and a Partner and associate at McKinsey from 1996 to 2004.James B. Kelligrew
Mr. Kelligrew is Vice Chair, Corporate and Commercial Banking, of U.S. Bancorp. Mr. Kelligrew, 57, has served in this position since January 2016. From March 2014 until December 2015, he served as Executive Vice
26
President, Fixed Income and Capital Markets, of U.S. Bancorp, having served as Executive Vice President, Credit Fixed Income, of U.S. Bancorp from May 2009 to March 2014. Prior to that time, he held various leadership positions with Wells Fargo Securities from 2003 to 2009.
Shailesh M. Kotwal
Mr. Kotwal is Vice Chair, Payment Services, of U.S. Bancorp. Mr. Kotwal,
58,59, has served in this position since joining U.S. Bancorp in March 2015. From July 2008 until May 2014, he served as Executive Vice President of TD Bank Group with responsibility for retail banking products and services and as Chair of its enterprise payments council. From 2006 until 2008, he served as President, International, of eFunds Corporation. Previously, Mr. Kotwal served in various leadership roles at American Express Company from 1989 until 2006, including responsibility for operations in North and South America, Europe and the Asia-Pacific regions.
Stephen L. Philipson
Katherine B. QuinnMs. QuinnMr. Philipson is Senior Executive Vice ChairPresident and Chief Administrative OfficerHead of Global Markets and Specialized Finance of U.S. Bancorp. Ms. Quinn, 58,Bancorp. Mr. Philipson, 45, has served in this position since April 2017.2023. From September 2013October 2017 to April 2017, she2023, he served as Executive Vice Presidenthead of Fixed Income and Chief StrategyCapital Markets. Previously, he led Credit & Municipal Fixed Income at U.S. Bank and, Reputation Officer of U.S. Bancorpprior to that, held roles in fixed income and has served on U.S. Bancorp’s Managing Committee since January 2015. From September 2010 until January 2013, she served as Chief Marketing Officer of WellPoint, Inc. (now known as Anthem, Inc.), having served as Head of Corporate Marketing of WellPoint from July 2005 until September 2010.
capital markets at Wachovia/Wells Fargo Securities and Morgan Stanley.
Ms. Richard is Vice Chair and Chief Risk Officer of U.S. Bancorp. Ms. Richard, 54,55, has served in this position since October 2018. She served as Executive Vice President and Chief Operational Risk Officer of U.S. Bancorp from January
2018 until October 2018, having served as Senior Vice President and Chief Operational Risk Officer from 2014 until January 2018. Prior to that time, Ms. Richard held various senior leadership roles at HSBC from 2003 until 2014, including Executive Vice President and Head of Operational Risk and Internal Control at HSBC North America from 2008 to 2014. Ms. Richard started her career at the Office of the Comptroller of the Currency in 1990 as a national bank examiner.
Mr. Runkel is Senior Executive Vice President and Chief Transformation Officer of U.S. Bancorp. Mr. Runkel,
46,47, has served in this position since August 2021. From December 2013 to August 2021, he served as Senior Executive Vice President and Chief Credit Officer. From February 2011 until December 2013, he served as Senior Vice President and Credit Risk Group Manager of U.S. Bancorp Retail and Payment Services Credit Risk Management, having served as Senior Vice President and Risk Manager of U.S. Bancorp Retail and Small Business Credit Risk Management from June 2009 until February 2011. From March 2005 until May 2009, he served as Vice President and Risk Manager of U.S. Bancorp.
John C. Stern
Mr. Stern is Senior Executive Vice President and Chief Financial Officer of U.S. Bancorp. Mr. Stern, 46, has served as Senior Executive Vice President since April 2023 and Chief Financial Officer since September 2023. He also served as Head of Finance from May 2023 to August 2023. He served as Executive Vice President from July 2013 through April 2023. From May 2021 until May 2023, he served as President of the Global Corporate Trust and Custody business of U.S. Bancorp. Previously, he served as Treasurer from July 2013 to May 2021 and has held various other leadership positions in his nearly 25 years at U.S. Bancorp.
Mr. Venturo is Senior Executive Vice President and Chief Digital Officer of U.S. Bancorp. Mr. Venturo,
56,57, has served in this position since July 2020. From January 2015 until July 2020, he served as Executive Vice President and Chief Innovation Officer of U.S. Bancorp, having served as Senior Vice President and Chief Innovation Officer of U.S. Bancorp Payment Services from January 2010 until January 2015. From January 2007 to December 2009, Mr. Venturo served as Senior Vice President and Chief Innovation Officer of U.S. Bancorp Retail Payment Solutions. Prior to that time, he served as Senior Vice President and held product management positions in various U.S. Bancorp Payment Services business lines from December 1998 to December 2006.
27
Jeffry H. von Gillern
Mr. von Gillern is Vice Chair, Technology and Operations Services, of U.S. Bancorp. Mr. von Gillern, 57, has served in this position since July 2010. From April 2001, when he joined U.S. Bancorp, until July 2010, Mr. von Gillern served as Executive Vice President of U.S. Bancorp, additionally serving as Chief Information Officer from July 2007 until July 2010.
Timothy A. Welsh
Mr. Welsh is Vice Chair, Consumer and Business Banking, of U.S. Bancorp. Mr. Welsh,
57,58, has served in this position since March 2019. Prior to that, he served as Vice Chair, Consumer Banking Sales and Support since joining U.S. Bancorp in July 2017. From July 2006 until June 2017, he served as a Senior Partner at McKinsey & Company where he specialized in financial services and the consumer experience. Previously, Mr. Welsh served as a Partner at McKinsey from 1999 to 2006.
Additional information in response to this Item 10 can be found in the Proxy Statement under the headings
“Proposal.“Proposal 1 — Election of
Directors,directors,” “Other matters — Delinquent Section 16(a) reports,” “Corporate
Governancegovernance — Committee
Responsibilities”responsibilities” and “Corporate
Governancegovernance — Committee
Member Qualifications.member qualifications.” That information is incorporated into this report by reference.
Item 11. | Executive Compensation
|
Item 11. Executive Compensation
Information required to be furnished in response to this Item 11 can be found in the Proxy Statement under the headings “Compensation
Discussiondiscussion and
Analysis,analysis,” “Compensation Committee
Report,report,” “Corporate
Governancegovernance – Compensation Committee Interlocks and Insider Participation,” “Executive
Compensation”compensation” and “Director
Compensation.compensation.” That information is incorporated into this report by reference.
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Equity Compensation Plan Information
The following table summarizes information regarding the Company’s equity compensation plans in effect as of December 31, 2022:
| | | | | | | | | | | | |
Plan Category | | Number of Securities
to be Issued upon
Exercise of
Outstanding Options,
Warrants and Rights | | | Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights | | | Number of Securities
Remaining Available for
Future Issuance under
Equity Compensation
Plans (Excluding
Securities Reflected in
the First Column) | |
Equity Compensation Plans Approved by Security Holders | | | | | | | | | | | 20,299,639 | (3) |
Stock Options | | | 3,253,090 | (1) | | $ | 44.42 | | | | | |
Restricted Stock Units and Performance-Based Restricted Stock Units | | | 6,952,232 | (2) | | | - | | | | | |
Equity Compensation Plans Not Approved by Security Holders | | | 372,941 | (4) | | | - | | | | - | |
| | | | | | | | | | | | |
Total | | | 10,578,263 | | | | | | | | 20,299,639 | |
(1) | Includes shares of the Company’s common stock underlying stock options granted under the U.S. Bancorp 2015 Stock Incentive Plan (the “2015 Plan”) and the U.S. Bancorp Amended and Restated 2007 Stock Incentive Plan (the “2007 Plan”).
|
28
(2) | Includes shares of the Company’s common stock underlying performance-based restricted stock units (awarded to the members of the Company’s Managing Committee and settled in shares of the Company’s common stock on a one-for-one basis) and restricted stock units (settled in shares of the Company’s common stock on a one-for-one basis) under the 2015 Plan, the 2007 Plan and the U.S. Bancorp 2001 Stock Incentive Plan. No exercise price is paid upon vesting, and thus, no exercise price is included in the table.
|
(3) | The 20,299,639 shares of the Company’s common stock available for future issuance are reserved under the 2015 Plan. Future awards under the 2015 Plan may be made in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalents, stock awards, or other stock-based awards.
|
(4) | These shares of the Company’s common stock are issuable pursuant to various current and former deferred compensation plans of U.S. Bancorp and its predecessor entities. No exercise price is paid when shares are issued pursuant to the deferred compensation plans.
|
The deferred compensation plans allow non-employee directorsCertain Beneficial Owners and members of senior management to defer all or part of their compensation until the earlier of retirement or termination of employment. The deferred compensation is deemed to be invested in one of several investment alternatives at the option of the participant, including shares of U.S. Bancorp common stock. Deferred compensation deemed to be invested in U.S. Bancorp stock will be received in the form of shares of U.S. Bancorp common stock at the time of distribution, unless the Company chooses cash payment.
The 372,941 shares included in the table assume that participants in the plans whose deferred compensation had been deemed to be invested in the Company’s common stock had elected to receive all of that deferred compensation in shares of the Company’s common stock on December 31, 2022. The U.S. Bank Executive Employees Deferred Compensation Plan (2005 Statement)Management and the U.S. Bank Outside Directors Deferred Compensation Plan (2005 Statement) are the Company’s only deferred compensation plans under which compensation may currently be deferred.Related Stockholder Matters
Additional
Information
Additional information in response to this Item 12 can be found in the Proxy Statement under the headingheadings "Equity compensation plan information" and “Security Ownershipownership of Certain Beneficial Ownerscertain beneficial owners and Management.management.” That information is incorporated into this report by reference.
Item 13. | Certain Relationships and Related Transactions, and Director Independence
|
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information in response to this Item 13 can be found in the Proxy Statement under the headings “Corporate
Governancegovernance — Director
Independence,independence,” “Corporate Governance — Committee
Member Qualifications”member qualifications” and “Certain
Relationshipsrelationships and
Related Transactions.related transactions.” That information is incorporated into this report by reference.
Item 14. | Principal Accounting Fees and Services
|
Item 14. Principal Accountant Fees and Services
Information in response to this Item 14 can be found in the Proxy Statement under the headings “Audit Committee
Reportreport and
Paymentpayment of
Feesfees to
Auditorauditor — Fees to
Independent Auditor”independent auditor” and “Audit Committee
Reportreport and
Paymentpayment of
Feesfees to
Auditorauditor — Administration of
Engagementengagement of
Independent Auditor.independent auditor.” That information is incorporated into this report by reference.
29
Item 15. | Exhibits and Financial Statement Schedules
|
Item 15. Exhibits and Financial Statement Schedules
List of documents filed as part of this
reportreport:
Report of Independent Registered Public Accounting Firm on the Financial Statements
•Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting
•Report of Independent Registered Public Accounting Firm on the Financial Statements
•U.S. Bancorp Consolidated Balance Sheet as of December 31, 20222023 and 20212022
•U.S. Bancorp Consolidated Statement of Income for each of the three years in the period ended December 31, 2022
2023•U.S. Bancorp Consolidated Statement of Comprehensive Income for each of the three years in the period ended December 31, 2022
2023•U.S. Bancorp Consolidated Statement of Shareholders’ Equity for each of the three years in the period ended December 31, 2022
2023•U.S. Bancorp Consolidated Statement of Cash Flows for each of the three years in the period ended December 31, 2022
2023•Notes to Consolidated Financial Statements
•U.S. Bancorp Consolidated Daily Average Balance Sheet and Related Yields and Rates (Unaudited)
•U.S. Bancorp Supplemental Financial Data (Unaudited)
2. Financial Statement Schedules
All financial statement schedules for the Company have been included in the consolidated financial statements or the related footnotes, or are either inapplicable or not required.
Shareholders may obtain a copy of any of the exhibits to this report upon payment of a fee covering the Company’s reasonable expenses in furnishing the exhibits. You can request exhibits by writing to Investor Relations, U.S. Bancorp, 800 Nicollet Mall, Minneapolis, Minnesota 55402.
| | |
| |
(1)10.0 | | |
| |
(1)(2)10.1(a)
| | |
| |
(1)(2)10.1(b)
| | |
| |
(1)(2)10.2
| | |
| |
(1)(2)10.3
| | |
| |
(1)(2)(3)10.4
| | |
| |
(1)(2)10.5(a)
| | |
| |
(1)(2)10.5(b)
| | |
| |
(1)(2)10.6
| | |
| |
(1)(2)10.7(a)
| | |
| |
(1)(2)10.7(b)
| | |
| |
(1)(2)10.8(a)
| | |
| |
(1)(2)10.8(b)
| | |
| |
(1)(2)10.8(c)
| | |
| |
(1)(2)10.9(a)
| | |
| |
(1)(2)10.9(b)
| | |
| |
(1)(2)10.10
| | |
| |
(1)(2)10.11
| | |
| |
(1)(2)10.12
| | |
31
| | | | | |
(1)(2)10.15
| | |
| |
(1)(2)10.16
| | |
| |
(1)(2)10.17
| | |
| |
(1)(2)10.18
| | |
| |
(1)(2)10.19
| | |
| |
(1)(2)10.20
| | |
| |
(1)(2)10.21
| | |
| |
(1)(2)10.22
| | |
| |
(1)(2)10.23
| | |
| |
(1)(2)10.24
| | |
| |
(1)(2)10.25
| | |
| |
(1)(2)10.26
| | |
| |
(1)(2)10.27
| | |
32
| | |
| |
(1)(2)10.28 | | |
| |
(1)(2)10.29
| | |
| |
(2)10.30 | |
| 13
|
(2)10.31 | |
| |
| 13 | |
| |
21 | | |
| |
23 | | |
| |
| | | | | |
24 | | |
| |
31.1 | | |
| |
31.2 | | |
| |
32 | | |
| |
| 97 | |
| |
| 101 | | The following financial statements from the Company’s Annual Report for the year ended December 31, 2022,2023, formatted in Inline XBRL: (i) Consolidated Balance Sheet, (ii) Consolidated Statement of Income, (iii) Consolidated Statement of Comprehensive Income, (iv) Consolidated Statement of Shareholders’ Equity, (v) Consolidated Statement of Cash Flows and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags. |
| |
104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101). |
| (1) | Exhibit has been previously filed with the SEC and is incorporated herein as an exhibit by reference to the prior filing.
|
|
(1)Exhibit has been previously filed with the SEC and is incorporated herein as an exhibit by reference to the prior filing. (2)Management contracts or compensatory plans or arrangements. (3)Certain appendices have been omitted. The Company will furnish copies of any such appendix to the U.S. Securities and Exchange Commission upon its request. Item 16. Form 10-K Summary (2)
| Management contracts or compensatory plans or arrangements.
|
(3) | Certain appendices have been omitted. The Company will furnish copies of any such appendix to the U.S. Securities and Exchange Commission upon its request.
|
* | The schedules and similar attachments to this exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to provide a copy of the omitted schedules and similar attachments on a supplemental basis to the U.S. Securities and Exchange Commission or its staff, if requested.
|
Item 16. | Form 10-K Summary
|
Not applicable.
33
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on February
27, 2023,20, 2024, on its behalf by the undersigned, thereunto duly authorized.
| | | | | | | | |
| U.S. BANCORP |
| | |
| By | /s/ ANDREW CECERE |
| By | /s/ ANDREW CECERE
Andrew Cecere |
| | Andrew Cecere |
| | Chairman, President and Chief Executive Officer |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on February
27, 2023,20, 2024, by the following persons on behalf of the registrant and in the capacities indicated.
| | |
Signature and Title |
|
/s/ ANDREW CECERE |
/s/ ANDREW CECERE
Andrew Cecere, |
Andrew Cecere,
|
Chairman, President and Chief Executive Officer, Director (principal executive officer) |
|
/s/ JOHN C. STERN |
/s/ TERRANCE R. DOLAN
John C. Stern, |
Terrance R. Dolan,
|
Senior Executive Vice ChairPresident and Chief Financial Officer (principal financial officer) |
|
/s/ LISA R. STARK |
/s/ LISA R. STARK
|
Lisa R. Stark, |
Executive Vice President and Controller (principal accounting officer) |
|
WARNER L. BAXTER* |
WARNER L. BAXTER*
|
Warner L. Baxter, Director |
|
DOROTHY J. BRIDGES* |
DOROTHY J. BRIDGES*
|
Dorothy J. Bridges, Director |
|
ELIZABETH L. BUSE* |
ELIZABETH L. BUSE*
|
Elizabeth L. Buse, Director |
|
ALAN B. COLBERG* |
ALAN B. COLBERG*
|
Alan B. Colberg, Director |
|
KIMBERLY N. ELLISON-TAYLOR* |
KIMBERLY N. ELLISON-TAYLOR*
|
Kimberly N. Ellison-Taylor, Director |
|
KIMBERLY J. HARRIS* |
KIMBERLY J. HARRIS*
|
Kimberly J. Harris, Director |
|
ROLAND A. HERNANDEZ* |
ROLAND A. HERNANDEZ*
|
Roland A. Hernandez, Director |
|
RICHARD P. MCKENNEY* |
OLIVIA F. KIRTLEY*
|
Olivia F. Kirtley, Director
|
34
|
Signature and Title
|
|
RICHARD P. MCKENNEY*
|
Richard P. McKenney, Director |
|
| | |
YUSUF I. MEHDI* |
YUSUF I. MEHDI*
|
Yusuf I. Mehdi, Director |
|
LORETTA E. REYNOLDS* |
LORETTA E. REYNOLDS*
|
Loretta E. Reynolds, Director |
|
JOHN P. WIEHOFF* |
JOHN P. WIEHOFF*
|
John P. Wiehoff, Director |
|
SCOTT W. WINE* |
SCOTT W. WINE*
|
Scott W. Wine, Director |
*Andrew Cecere, by signing his name hereto, does hereby sign this document on behalf of each of the above named directors of the registrant pursuant to powers of attorney duly executed by such persons.
Dated: February 20, 2024
| | | | | | | | |
| By: | /s/ ANDREW CECERE |
| | Andrew Cecere by signing his name hereto, does hereby sign this document on behalf of each of the above named directors of the registrant pursuant to powers of attorney duly executed by such persons. |
Dated: February 27, 2023
| | |
| By: | /s/ ANDREW CECERE
|
| | Andrew Cecere |
| | Attorney-In-Fact |
35