U.S. Bancorp 1Q13 Earnings Conference Call U.S. Bancorp 1Q13 Earnings Conference Call April 16, 2013 Richard K. Davis Chairman, President and CEO Andy Cecere Vice Chairman and CFO Exhibit 99.2 |
2 Forward-looking Statements and Additional Information The following information appears in accordance with the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements about U.S. Bancorp. Statements that are not historical or current facts, including 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 made. These forward-looking statements cover, among other things, anticipated future revenue and expenses and the future plans and prospects of U.S. Bancorp. Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. Global and domestic economies could fail to recover from the recent economic downturn or could experience another severe contraction, which could adversely affect U.S. Bancorp’s revenues and the values of its assets and liabilities. Global financial markets could experience a recurrence of significant turbulence, which could reduce the availability of funding to certain financial institutions and lead to a tightening of credit, a reduction of business activity, and increased market volatility. Continued stress in the commercial real estate markets, as well as a delay or failure of recovery in the residential real estate markets, could cause additional credit losses and deterioration in asset values. In addition, U.S. Bancorp’s business and financial performance is likely to be negatively impacted by recently enacted and future legislation and regulation. U.S. Bancorp’s results could also be adversely affected by deterioration in general business and economic conditions; changes in interest rates; deterioration in the credit quality of its loan portfolios or in the value of the collateral securing those loans; deterioration in the value of securities held in its investment securities portfolio; legal and regulatory developments; increased competition from both banks and non-banks; changes in customer behavior and preferences; effects of mergers and acquisitions and related integration; effects of critical accounting policies and judgments; and management’s ability to effectively manage credit risk, residual value risk, market risk, operational risk, interest rate risk and liquidity risk. For discussion of these and other risks that may cause actual results to differ from expectations, refer to U.S. Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2012, on file with the Securities and Exchange Commission, including the sections entitled “Risk Factors” and “Corporate Risk Profile” contained in Exhibit 13, and all subsequent filings with the Securities and Exchange Commission under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934. Forward-looking statements speak only as of the date they are made, and U.S. Bancorp undertakes no obligation to update them in light of new information or future events. This presentation includes non-GAAP financial measures to describe U.S. Bancorp’s performance. The reconciliations of those measures to GAAP measures are provided within or in the appendix of the presentation. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. |
3 1Q13 Earnings Conference Call 1Q13 Highlights Net income of $1.4 billion; $0.73 per diluted common share Positive operating leverage on a linked quarter and year-over-year basis Average loan growth of 5.8% vs. 1Q12 and average loan growth of 1.0% vs. 4Q12 Strong average deposit growth of 7.3% vs. 1Q12 and 0.5% vs. 4Q12 Net charge-offs declined 7.5% vs. 4Q12 Nonperforming assets declined 9.9% vs. 4Q12 (2.8% excluding covered assets) Capital generation continues to reinforce capital position Tier 1 common equity ratio of approximately 8.2% using proposed rules for Basel III standardized approach released June 2012 Tier 1 common equity ratio of 9.1%; Tier 1 capital ratio of 11.0% Repurchased 17 million shares of common stock during 1Q13 |
4 1Q13 Earnings Conference Call Performance Ratios ROCE and ROA Efficiency Ratio and Net Interest Margin Return on Avg Common Equity Return on Avg Assets Efficiency Ratio Net Interest Margin Efficiency ratio computed as noninterest expense divided by the sum of net interest income on a taxable-equivalent basis and noninterest income excluding securities gains (losses) net |
Taxable-equivalent basis Revenue Growth Year-Over-Year Growth 9.1% 8.1% 8.0% 0.2% (1.1%) $ in millions $4,929 $5,068 $5,179 $5,112 $4,874 3,500 4,000 4,500 5,000 5,500 1Q12 2Q12 3Q12 4Q12 1Q13 5 1Q13 Earnings Conference Call |
Loan and Deposit Growth Average Balances Year-Over-Year Growth $ in billions 7.7% $214.1 7.3% $216.9 6.4% $220.3 5.8% $222.4 6.4% $210.2 10.5% $231.3 11.1% $239.3 9.2% $243.8 7.3% $245.0 11.7% $228.3 170.0 190.0 210.0 230.0 250.0 1Q12 2Q12 3Q12 4Q12 1Q13 1Q13 Earnings Conference Call 6 Loans Deposits |
7 Credit Quality * Excluding Covered Assets (assets subject to loss sharing agreements with FDIC) ** Related to a regulatory clarification in the treatment of residential mortgage and other consumer loans to borrowers who have exited bankruptcy but continue to make payments on their loans *** Excluding $54 million of incremental charge-offs Net Charge-offs Nonperforming Assets* $ in millions Net Charge-offs (Left Scale) NCOs to Avg Loans (Right Scale) Nonperforming Assets (Left Scale) NPAs to Loans plus ORE (Right Scale) $433 $571 $520 $538 $468 $2,029 $2,423 $2,256 $2,188 $2,088 1Q13 Earnings Conference Call 1.09% 0.98% 0.99% 0.85% 0.79% 0.89%*** 0.00% 0.75% 1.50% 2.25% 3.00% 0 200 400 600 800 1Q12 2Q12 3Q12 4Q12 1Q13 1.22% 1.11% 1.06% 0.98% 0.95% 0.00% 0.75% 1.50% 2.25% 3.00% 0 800 1,600 2,400 3,200 1Q12 2Q12 3Q12 4Q12 1Q13 |
8 1Q13 Earnings Conference Call Earnings Summary $ in millions, except per-share data Taxable-equivalent basis 1Q13 4Q12 1Q12 vs 4Q12 vs 1Q12 Net Interest Income 2,709 $ 2,783 $ 2,690 $ (2.7) 0.7 Noninterest Income 2,165 2,329 2,239 (7.0) (3.3) Total Revenue 4,874 5,112 4,929 (4.7) (1.1) Noninterest Expense 2,470 2,686 2,560 8.0 3.5 Operating Income 2,404 2,426 2,369 (0.9) 1.5 Net Charge-offs 433 468 571 7.5 24.2 Excess Provision (30) (25) (90) -- -- Income before Taxes 2,001 1,983 1,888 0.9 6.0 Applicable Income Taxes 614 608 583 (1.0) (5.3) Noncontrolling Interests 41 45 33 (8.9) 24.2 Net Income 1,428 1,420 1,338 0.6 6.7 Preferred Dividends/Other 70 71 53 1.4 (32.1) NI to Common 1,358 $ 1,349 $ 1,285 $ 0.7 5.7 Diluted EPS 0.73 $ 0.72 $ 0.67 $ 1.4 9.0 Average Diluted Shares 1,867 1,880 1,910 0.7 2.3 % B/(W) |
9 1Q13 Earnings Conference Call 1Q13 Results - Key Drivers vs. 1Q12 Net Revenue decline of 1.1% • Net interest income growth of 0.7%; net interest margin of 3.48% vs. 3.60% in 1Q12 • Noninterest income decline of 3.3% Noninterest expense decline of 3.5% Provision for credit losses lower by $78 million • Net charge-offs lower by $138 million • Provision lower than NCOs by $30 million vs. $90 million in 1Q12 vs. 4Q12 Net Revenue decline of 4.7% • Net interest income decline of 2.7%; net interest margin of 3.48% vs. 3.55% in 4Q12 • Noninterest income decline of 7.0% Noninterest expense decline of 8.0% (5.2% decline excluding notable items) Provision for credit losses lower by $40 million • Net charge-offs lower by $35 million • Provision lower than NCOs by $30 million vs. $25 million in 4Q12 |
10 1Q13 Earnings Conference Call Capital Position $ in billions RWA = risk-weighted assets 1Q13 4Q12 3Q12 2Q12 1Q12 Shareholders' equity 39.5 $ 39.0 $ 38.7 $ 37.8 $ 35.9 $ Tier 1 capital 31.8 31.2 30.8 30.0 30.0 Total risk-based capital 38.1 37.8 37.6 36.4 36.4 Tier 1 common equity ratio 9.1% 9.0% 9.0% 8.8% 8.7% Tier 1 capital ratio 11.0% 10.8% 10.9% 10.7% 10.9% Total risk-based capital ratio 13.2% 13.1% 13.3% 13.0% 13.3% Leverage ratio 9.3% 9.2% 9.2% 9.1% 9.2% Tangible common equity ratio 7.4% 7.2% 7.2% 6.9% 6.9% Tangible common equity as a % of RWA 8.8% 8.6% 8.8% 8.5% 8.3% Basel III Tier 1 common equity ratio using Basel III proposals published prior to June 2012 - - - - 8.4% Tier 1 common equity ratio approximated using proposed rules for the Basel III standardized approach released June 2012 8.2% 8.1% 8.2% 7.9% - |
Capital Actions Share repurchase authorization and expected dividend increase announced March 14 th Expect to increase annual dividend from $0.78 to $0.92, an 18% increase, effective 2Q13 One year authorization to repurchase up to $2.25 billion of outstanding stock effective 4/1/13 Returned 69% of earnings to shareholders during 1Q13 Reinvest and Acquisitions Dividends Share Repurchases 20 - 40% Targets: 30 - 40% 30 - 40% 31% 1Q13 Actual: 42% 27% Earnings Distribution 1Q13 Earnings Conference Call 11 |
12 1Q13 Earnings Conference Call Mortgage Repurchase Mortgages Repurchased and Make-whole Payments Mortgage Representation and Warranties Reserve $ in millions 1Q13 4Q12 3Q12 2Q12 1Q12 Beginning Reserve $240 $220 $216 $202 $160 Net Realized Losses (23) (32) (32) (31) (25) Additions to Reserve 16 52 36 45 67 Ending Reserve $233 $240 $220 $216 $202 Mortgages repurchased and make-whole payments $79 $57 $58 $58 $55 Repurchase activity lower than peers due to: • Conservative credit and underwriting culture • Disciplined origination process - primarily conforming loans ( 95% sold to GSEs) Do not participate in private placement securitization market Outstanding repurchase and make-whole requests balance = $66 million |
13 A Rich Heritage A Strong Future A Rich Heritage A Strong Future 1863 - 2013 |
14 1Q13 Earnings Conference Call Appendix |
15 1Q13 Earnings Conference Call Commercial CRE Res Mtg Credit Card Retail Average Loans Average Loans Key Points $ in billions vs. 1Q12 Average total loans grew over $12 billion, or 5.8% Average total loans, excluding covered loans, were higher by 8.0% Average total commercial loans increased $8.2 billion, or 14.3%; average residential mortgage loans increased $7.3 billion, or 19.2% vs. 4Q12 Average total loans grew over $2 billion, or 1.0% Average total loans, excluding covered loans, were higher by 1.4% Average total commercial loans increased $1.4 billion, or 2.1%; average residential mortgage loans increased $2.0 billion, or 4.5% Year-Over-Year Growth 6.4% 7.7% 7.3% 6.4% 5.8% $220.3 $222.4 $210.2 $214.1 $216.9 Covered Covered Commercial CRE Res Mtg Retail Credit Card |
16 1Q13 Earnings Conference Call Time Money Market Checking & Savings Noninterest -bearing Average Deposits Average Deposits Key Points $ in billions vs. 1Q12 Average total deposits increased by $16.7 billion, or 7.3% Average low cost deposits (NIB, interest checking, money market and savings) increased by $13.5 billion, or 7.3% vs. 4Q12 Average total deposits increased by $1.2 billion, or 0.5% Average low cost deposits increased by $1.7 billion, or 0.9% Year-Over-Year Growth 11.7% 10.5% 11.1% 9.2% 7.3% $243.8 $245.0 $228.3 $231.3 $239.3 Time Money Market Checking and Savings Noninterest-bearing |
17 1Q13 Earnings Conference Call Net Interest Income Net Interest Income Key Points $ in millions Taxable-equivalent basis vs. 1Q12 Average earning assets grew by $13.9 billion, or 4.6% Net interest margin lower by 12 bps (3.48% vs. 3.60%) driven by: • Higher balances in lower yielding investment securities and lower loan yields • Partially offset by lower rates on deposits and long- term debt and a reduction in cash balances held at the Federal Reserve vs. 4Q12 Average earning assets grew by $1.8 billion, or 0.6% Net interest margin lower by 7 bps (3.48% vs. 3.55%) driven by: • Lower loan yields • Seasonally lower loan fees Year-Over-Year Growth 7.3% 6.6% 6.1% 4.1% 0.7% $2,690 $2,713 $2,783 $2,709 3.60% 3.58% 3.59% 3.55% 3.48% 8.0% 6.0% 4.0% 2.0% 0.0% 1Q12 2Q12 3Q12 4Q12 1Q13 Net Interest Income Net Interest Margin 0 1,000 2,000 3,000 4,000 $2,783 |
18 1Q13 Earnings Conference Call Noninterest Income Noninterest Income Key Points $ in millions Payments = credit and debit card revenue, corporate payment products revenue and merchant processing; Service charges = deposit service charges, treasury management fees and ATM processing services vs. 1Q12 Noninterest income declined by $74 million, or 3.3%, driven by: • Lower other income, mainly due to lower equity investment and retail leasing revenue • Mortgage banking revenue decline of $51 million • Lower commercial products revenue (5.2% decline) due to lower syndication and standby letters of credit fees, partially offset by higher bond underwriting fees • Higher trust and investment management fees (10.3% increase) due to improved market conditions and business expansion • Higher credit and debit card revenue (5.9% increase) and higher merchant processing (3.0% increase) vs. 4Q12 Noninterest income declined by $164 million, or 7.0%, driven by: • Mortgage banking revenue decrease of $75 million • Lower commercial products revenue (11.5% decline) due to lower commercial leasing revenue and lower syndication and standby letter of credit fees • Lower deposit service charges (10.0% decline), principally due to seasonally lower transaction volumes • Lower credit and debit card revenue (11.6% decline) due to seasonally lower volumes, partially offset by business expansion, lower merchant processing revenue (2.0% decline) due to seasonally lower product fees, and lower corporate payment revenue (3.4% decline), primarily due to lower government-related transaction volumes Year-Over-Year Growth 11.3% 9.7% 10.4% (4.2%) (3.3%) $2,329 $2,165 $2,239 $2,355 $2,396 Trust and Inv Mgmt Service Charges All Other Mortgage Payments All Other Mortgage Service Charges Trust and Inv Mgmt Payments 1Q12 2Q12 3Q12 4Q12 1Q13 Non-operating gains - $ - $ - $ - $ - $ Total - $ - $ - $ - $ - $ Notable Noninterest Income Items $2,165 $2,329 $2,396 $2,355 $2,239 2.7% 10.3% (1.3%) (11.3%) 2,800 2,100 1,400 700 0 1Q12 2Q12 3Q12 4Q12 1Q13 (14.1%) |
19 1Q13 Earnings Conference Call Noninterest Expense Noninterest Expense Key Points $ in millions vs. 1Q12 Noninterest expense was lower by $90 million, or 3.5%, driven by: • Lower other expense, mainly due to favorable variances in litigation, regulatory and insurance-related expense • Lower marketing and business development expense (33.0% decline), primarily reflecting the timing of charitable contributions in 2012 • Lower professional services expense (7.1% decline) due to reduction in mortgage servicing review-related costs • Higher compensation (2.9% increase), primarily the result of growth in staffing and employee benefits (19.2% increase), mainly due to higher pension costs vs. 4Q12 Noninterest expense was lower by $216 million, or 8.0%, driven by: • Lower other expense due to the $80 million mortgage foreclosure-related regulatory settlement accrual in 4Q12, lower litigation and insurance-related expense and lower costs related to investments in affordable housing and other tax- advantaged projects • Lower professional services expense (53.0% decrease) due to lower mortgage servicing review-related projects and lower marketing and business development expense (29.1% decline) due to timing of marketing activities • Higher benefits expense (34.2% increase) due mainly to higher pension costs and seasonally higher payroll taxes Year-Over-Year Growth 10.6% 7.3% 5.4% (0.4%) (3.5%) $2,686 $2,470 $2,560 $2,601 $2,609 Occupancy and Equipment Prof Services, Marketing and PPS All Other Tech and Comm Compensation and Benefits All Other Tech and Communications Prof Svcs, Marketing and PPS Occupancy and Equipment Compensation and Benefits 1Q12 2Q12 3Q12 4Q12 1Q13 Mortgage servicing matters - $ - $ - $ 80 $ - $ Total - $ - $ - $ 80 $ - $ Notable Noninterest Expense Items 2,800 2,100 1,400 700 0 1Q12 2Q12 3Q12 4Q12 1Q13 6.1% 6.8% (15.0%) (27.7%) 5.0% |
20 1Q13 Earnings Conference Call Credit Quality - Commercial Loans Average Loans and Net Charge-offs Ratios Key Statistics Comments Strong new lending activity resulted in 2.3% linked quarter loan growth and 16.8% year-over-year growth even though utilization rates remained at historically low levels Nonperforming loans and net charge-offs continued to improve year-over-year and on a linked quarter basis Early stage delinquencies improved year-over-year and on a linked quarter basis 1Q12 4Q12 1Q13 Average Loans $51,309 $58,552 $59,921 30-89 Delinquencies 0.30% 0.48% 0.20% 90+ Delinquencies 0.08% 0.10% 0.10% Nonperforming Loans 0.53% 0.18% 0.14% $ in millions $51,309 $54,362 $56,655 $58,552 $59,921 80,000 60,000 40,000 20,000 0 1Q12 2Q12 3Q12 4Q12 1Q13 0.0% 1.0% 2.0% 3.0% 4.0% Net Charge-offs Ratio Average Loans 0.61% 0.41% 0.41% 0.32% 0.22% 20% 25% 30% 35% 40% Revolving Line Utilization Trend |
21 1Q13 Earnings Conference Call Credit Quality - Commercial Leases Average Loans and Net Charge-offs Ratios Key Statistics Comments Net charge-offs continue to improve both on a year-over-year and a linked quarter basis Nonperforming loans improved year-over-year, and are relatively stable on a linked quarter basis Early stage delinquencies improved year-over-year and on a linked quarter basis 1Q12 4Q12 1Q13 Average Loans $5,822 $5,377 $5,378 30-89 Delinquencies 0.89% 0.89% 0.82% 90+ Delinquencies 0.00% 0.00% 0.00% Nonperforming Loans 0.54% 0.29% 0.30% $ in millions $5,822 $5,658 $5,537 $5,377 $5,378 0.55% 1.07% 0.50% 0.37% 0.23% 0.0% 1.0% 2.0% 3.0% 4.0% 0 2,000 4,000 6,000 8,000 1Q12 2Q12 3Q12 4Q12 1Q13 Average Loans Net Charge -offs Ratio Small Ticket $3,359 Equipment Finance $2,019 Commercial Leases |
22 Credit Quality - Commercial Real Estate Average Loans and Net Charge-offs Ratios Key Statistics Comments Average loans increased 1% on a linked quarter basis Early stage delinquencies improved year-over-year and on a linked quarter basis Nonperforming loans continued to decline, down from the peak of 5.36% in 1Q10 1Q12 4Q12 1Q13 Average Loans $35,985 $36,851 $37,218 30-89 Delinquencies 0.45% 0.43% 0.22% 90+ Delinquencies 0.04% 0.02% 0.02% Nonperforming Loans 2.10% 1.48% 1.36% Performing TDRs* 630 531 526 $ in millions Investor $19,877 Owner Occupied $11,134 Multi-family $2,046 Retail $479 Residential Construction $985 Condo Construction $146 A&D Construction $717 Office $775 Other $1,059 * TDR = troubled debt restructuring $35,985 $36,549 $36,630 $36,851 $37,218 0.79% 0.58% 0.27% 0.18% 0.21% 0.0% 1.0% 2.0% 3.0% 4.0% 1Q12 2Q12 3Q12 4Q12 1Q13 Net Charge-offs Ratio 0 15,000 30,000 45,000 60,000 CRE Mortgage CRE Construction 1Q13 Earnings Conference Call Average Loans |
23 Credit Quality - Residential Mortgage Average Loans and Net Charge-offs Ratios Key Statistics Comments Strong growth in high quality originations (weighted average FICO 765, weighted average LTV 64%) as average loans increased 4.5% over 4Q12, driven by demand for refinancing Over 72% of the balances have been originated since the beginning of 2009, the origination quality metrics and performance to date have significantly outperformed prior vintages with similar seasoning Delinquencies and nonperforming loans continue to decline as housing values improve 1Q12 4Q12 1Q13 Average Loans $37,831 $43,156 $45,109 30-89 Delinquencies 0.95% 0.79% 0.71% 90+ Delinquencies 0.79% 0.64% 0.54% Nonperforming Loans 1.78% 1.50% 1.46% $ in millions ** Excludes GNMA loans, whose repayments are insured by the FHA or guaranteed by the Department of VA ($1,909 million 1Q13) $37,831 $39,166 $40,969 $43,156 $45,109 1.19% 1.12% 1.17% 0.88% 0.83% 0.96%* 0.0% 1.0% 2.0% 3.0% 4.0% 0 15,000 30,000 45,000 60,000 1Q12 2Q12 3Q12 4Q12 1Q13 Average Loans Net Charge-offs Ratio Adjusted NCO Ratio $2,017 $2,011 $2,076 $2,087 $2,035 0 1,000 2,000 3,000 4,000 1Q12 2Q12 3Q12 4Q12 1Q13 Residential Mortgage Performing TDRs** 1Q13 Earnings Conference Call * Excluding $22 million related to a regulatory clarification in the treatment of loans to borrowers who have exited bankruptcy but continue to make payments on their loans |
24 1Q13 Earnings Conference Call 1Q12 4Q12 1Q13 Average Loans $16,778 $16,588 $16,528 30-89 Delinquencies 1.26% 1.33% 1.24% 90+ Delinquencies 1.33% 1.27% 1.26% Nonperforming Loans 1.25% 0.85% 0.78% Credit Quality - Credit Card Average Loans and Net Charge-offs Ratios Key Statistics Comments Net charge-offs continue to remain low Delinquencies remain at historically low levels Nonperforming loans have decreased for seven consecutive quarters $ in millions * Excluding portfolio purchases where the acquired loans were recorded at fair value at the purchase date Average Loans Net Charge-offs Ratio Net Charge-offs Ratio Excluding Acquired Portfolios* |
25 1Q13 Earnings Conference Call Credit Quality - Home Equity Average Loans and Net Charge-offs Ratios Key Statistics Comments High-quality originations (weighted average FICO 760, weighted average CLTV 72%) originated primarily through the retail branch network to existing bank customers on their primary residence Early and late stage delinquencies have improved year-over-year and on a linked quarter basis 1Q12 4Q12 1Q13 Average Loans $17,933 $16,950 $16,434 30-89 Delinquencies 0.82% 0.76% 0.70% 90+ Delinquencies 0.68% 0.30% 0.27% Nonperforming Loans 0.23% 1.13% 1.25% Subprime: 2% Wtd Avg LTV**: 91% NCO: 8.02% $ in millions Prime: 95% Wtd Avg LTV**: 72% NCO: 1.61% ** LTV at origination Other: 3% Wtd Avg LTV**: 73% NCO: 3.77% * Excluding $26 million related to a regulatory clarification in the treatment of loans to borrowers who have exited bankruptcy but continue to make payments on their loans |
26 1Q13 Earnings Conference Call Credit Quality - Retail Leasing Average Loans and Net Charge-offs Ratios Key Statistics Comments High-quality originations (weighted average FICO 771) Retail leasing delinquencies remain relatively stable at very low levels Strong used auto values continued to contribute to historically low net charge-offs 1Q12 4Q12 1Q13 Average Loans $5,095 $5,384 $5,448 30-89 Delinquencies 0.12% 0.22% 0.12% 90+ Delinquencies 0.02% 0.02% 0.02% Nonperforming Loans 0.00% 0.02% 0.02% $ in millions * Manheim Used Vehicle Value Index source: www.manheimconsulting.com, January 1995 = 100, quarter value = average monthly ending value |
27 1Q13 Earnings Conference Call Credit Quality - Other Retail Average Loans and Net Charge-offs Ratios Key Statistics Comments Year-over-year growth in Auto Loans (7.4%) more than offset declines in Student Lending loan balances (see slide 28 for auto loan detail) Delinquencies and nonperforming loans remain stable and at very low levels 1Q12 4Q12 1Q13 Average Loans $24,902 $25,595 $25,364 30-89 Delinquencies 0.51% 0.59% 0.48% 90+ Delinquencies 0.17% 0.17% 0.16% Nonperforming Loans 0.10% 0.11% 0.10% Installment $5,456 Auto Loans $12,519 Revolving Credit $3,276 Student Lending $4,113 $ in millions * Excluding $5 million related to a regulatory clarification in the treatment of loans to borrowers who have exited bankruptcy but continue to make payments on their loans Other Retail |
28 1Q13 Earnings Conference Call Credit Quality - Auto Loans Average Loans and Net Charge-offs Ratios Key Statistics Comments High-quality originations (Indirect channel weighted average FICO 772, Direct channel weighted average FICO 749) and strong used vehicle values have led to a low loss portfolio Overall year-over-year loan growth driven by Indirect channel 1Q12 4Q12 1Q13 Average Loans $11,657 $12,540 $12,519 30-89 Delinquencies 0.43% 0.41% 0.30% 90+ Delinquencies 0.06% 0.06% 0.03% Nonperforming Loans 0.00% 0.02% 0.02% $ in millions Auto Loans are included in Other Retail category Direct: 9% Wtd Avg FICO: 748 NCO: 0.04% Indirect: 91% Wtd Avg FICO: 770 NCO: 0.17% |
29 1Q13 Earnings Conference Call Non-GAAP Financial Measures $ in millions 1Q13 4Q12 3Q12 2Q12 1Q12 Total equity 40,847 $ 40,267 $ 39,825 $ 38,874 $ 36,914 $ Preferred stock (4,769) (4,769) (4,769) (4,769) (3,694) Noncontrolling interests (1,316) (1,269) (1,164) (1,082) (1,014) Goodwill (net of deferred tax liability) (8,333) (8,351) (8,194) (8,205) (8,233) Intangible assets (exclude mortgage servicing rights) (963) (1,006) (980) (1,118) (1,182) Tangible common equity (a) 25,466 24,872 24,718 23,700 22,791 Tier 1 capital, determined in accordance with prescribed regulatory requirements using Basel I definition 31,774 31,203 30,766 30,044 29,976 Trust preferred securities - - - - (1,800) Preferred stock (4,769) (4,769) (4,769) (4,769) (3,694) Noncontrolling interests, less preferred stock not eligible for Tier I capital (684) (685) (685) (685) (686) Tier 1 common equity using Basel I definition (b) 26,321 25,749 25,312 24,590 23,796 Tangible common equity (as calculated above) 22,791 Adjustments¹ 434 Tier 1 common equity using Basel III proposals published prior to June 2012 (c) 23,225 Tangible common equity (as calculated above) 25,466 24,872 24,718 23,700 81 126 157 153 Tier 1 common equity approximated using proposed rules for the Basel III standardized approach released June 2012 (d) 25,547 24,998 24,875 23,853 Total assets 355,447 353,855 352,253 353,136 340,762 Goodwill (net of deferred tax liability) (8,333) (8,351) (8,194) (8,205) (8,233) Intangible assets (exclude mortgage servicing rights) (963) (1,006) (980) (1,118) (1,182) Tangible assets (e) 346,151 344,498 343,079 343,813 331,347 Risk-weighted assets, determined in accordance with prescribed regulatory requirements using Basel I definition (f) 289,672 287,611 282,033 279,972 274,847 Risk-weighted assets using Basel III proposals published prior to June 2012 (g) - - - - 277,856 Risk-weighted assets, determined in accordance with prescribed regulatory requirements using Basel I definition 289,672 287,611 282,033 279,972 21,021 21,233 22,167 23,240 Risk-weighted assets approximated using proposed rules for the Basel III standardized approach released June 2012 (h) 310,693 308,844 304,200 303,212 Ratios Tangible common equity to tangible assets (a)/(e) 7.4% 7.2% 7.2% 6.9% 6.9% Tangible common equity to risk-weighted assets using Basel I definition (a)/(f) 8.8% 8.6% 8.8% 8.5% 8.3% Tier 1 common equity to risk-weighted assets using Basel I definition (b)/(f) 9.1% 9.0% 9.0% 8.8% 8.7% Tier 1 common equity to risk-weighted assets using Basel III proposals published prior to June 2012 (c)/(g) - - - - 8.4% Tier 1 common equity to risk-weighted assets approximated using proposed rules for the 8.2% 8.1% 8.2% 7.9% - 1Q13 risk-weighted assets are preliminary data, subject to change prior to filings with applicable regulatory agencies 1 Principally net losses on cash flow hedges included in accumulated other comprehensive income 2 Includes net losses on cash flow hedges included in accumulated other comprehensive income, unrealized losses on securities transferred from available-for-sale to held-to-maturity included in accumulated other comprehensive income and disallowed mortgage servicing rights 3 Includes higher risk-weighting for residential mortgages, unfunded loan commitments, investment securities and purchased mortgage servicing rights, and other adjustments Basel III standardized approach released June 2012 (d)/(h) Adjustments² Adjustments³ |
U.S. Bancorp 1Q13 Earnings Conference Call U.S. Bancorp 1Q13 Earnings Conference Call April 16, 2013 |