Exhibit 99.1
News Release
U.S. Bancorp announces $3 billion common stock repurchase program
MINNEAPOLIS (December 22, 2020) — U.S. Bancorp (NYSE: USB) announced that it has received its results of the December 2020 Stress Test from the Federal Reserve. Based on the results, the company’s common equity tier 1 (CET1) capital requirement remains at 7.0 percent which includes the Stress Capital Buffer requirement of 2.5 percent. Under the Supervisory Severely Adverse and Supervisory Alternative Severe scenarios the company’s minimum CET1 ratio was 7.6 and 7.8 percent, respectively, above the regulatory requirement.
The Federal Reserve extended, with modifications, the capital restrictions through the first quarter of 2021 due to “ongoing economic uncertainty and to preserve the strength of the banking sector.” These restrictions include capping common stock dividends at existing rates and limiting the aggregate amount of common stock dividends and share repurchases to an amount that does not exceed the average net income of the four preceding calendar quarters.
The U.S. Bancorp board of directors currently intends to maintain the quarterly common stock dividend of $0.42 per common share. The company’s quarterly common stock dividends are subject to approval of the board of directors.
The U.S. Bancorp board of directors has approved an authorization to repurchase up to $3 billion of the company’s outstanding common stock beginning January 1, 2021 and the company intends to begin repurchasing shares in the first quarter of 2021. The stock may be repurchased in the open market or in privately negotiated transactions. U.S. Bancorp will utilize the share repurchase program at its discretion as it continues to monitor the economic environment, manage to its long-term earnings distribution targets while maintaining strong capital levels and remain in compliance with regulatory requirements. The company will adjust its capital distributions as conditions warrant. Additional capital distributions, including share repurchases, are subject to the approval of the company’s board of directors.
“The results of this stress test reflect again, the strength of our balance sheet, our diverse businesses and our strong financial discipline,” said Andy Cecere, chairman, president and CEO of U.S. Bancorp. “Our capital position remained strong through these challenging times and we believe the reinstatement of the share repurchase program will allow us to continue to deliver on our commitment of creating long-term value for our shareholders, customers and employees through continued investment in our business, support to our customers and prudent deployment of capital to our shareholders.”
About U.S. Bancorp
U.S. Bancorp, with more than 70,000 employees and $540 billion in assets as of September 30, 2020, is the parent company of U.S. Bank National Association, the fifth-largest commercial bank in the United States. The Minneapolis-based bank blends its relationship teams, branches and ATM network with mobile and online tools that allow customers to bank how, when and where they prefer. U.S. Bank is committed to serving its millions of retail, business, wealth management, payment, commercial and corporate, and investment services customers across the country and around the world as a trusted financial partner, a commitment recognized by the Ethisphere Institute naming the bank one of the 2020 World’s Most Ethical Companies. Visit U.S. Bank at www.usbank.com or follow on social media to stay up to date with company news.
Forward-looking statements
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995:
This news release 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 hereof. The forward-looking statements contained in this press release include, among other things, anticipated U.S. Bancorp capital distributions by dividends and share repurchases. There can be no assurance that U.S. Bancorp will return this or any amount of capital to its shareholders in the form of dividends or share repurchases in the future.
