US Bank 2001 Annual Report Download - page 55

Notes to Consolidated Financial Statements
Institutional Trust and Custody and Fund Services. The
SigniÑcant Accounting Policies
business segment also oÅers investment management
U.S. Bancorp and its subsidiaries (the ""Company'') services to several client segments including mutual funds,
compose the organization created by the acquisition by institutional customers, and private asset management.
Firstar Corporation (""Firstar'') of the former U.S. Bancorp Payment Services includes consumer and business credit
(""USBM''). The new Company retained the U.S. Bancorp cards, corporate and purchasing card services, consumer
name. The Company is a multi-state Ñnancial services lines of credit, ATM processing and merchant processing.
holding company headquartered in Minneapolis, Minnesota. Capital Markets engages in equity and Ñxed income
The Company provides a full range of Ñnancial services trading activities, oÅers investment banking and
including lending and depository services through banking underwriting services for corporate and public sector
oÇces principally in 24 states. The Company also engages in customers and provides Ñnancial advisory services and
credit card, merchant, and ATM processing, mortgage securities, mutual funds, annuities and insurance products to
banking, insurance, trust and investment management, consumers and regionally based businesses through a
brokerage, leasing and investment banking activities network of brokerage oÇces.
principally in domestic markets. Treasury and Corporate Support includes the
Company's investment and residential mortgage portfolios,
Basis of Presentation The consolidated Ñnancial
funding, capital management and asset securitization
statements include the accounts of the Company and its
activities, interest rate risk management, the net eÅect of
subsidiaries. The consolidation eliminates all signiÑcant
transfer pricing related to loan and deposit balances, and
intercompany accounts and transactions. Certain items in
the change in residual allocations associated with the
prior periods have been reclassiÑed to conform to the
provision for loan losses. It also includes business activities
current presentation.
managed on a corporate basis, including income and
Uses of Estimates The preparation of Ñnancial statements expense of enterprise-wide operations and administrative
in conformity with generally accepted accounting principles support functions.
requires management to make estimates and assumptions
Segment Results Accounting policies for the lines of
that aÅect the amounts reported in the Ñnancial statements
business are the same as those used in preparation of the
and accompanying notes. Actual experience could diÅer
consolidated Ñnancial statements with respect to activities
from those estimates.
speciÑcally attributable to each business line. However, the
BUSINESS SEGMENTS preparation of business line results requires management to
establish methodologies to allocate funding costs and
Within the Company, Ñnancial performance is measured by beneÑts, expenses and other Ñnancial elements to each line
major lines of business based on the products and services of business. For details of these methodologies and segment
provided to customers through its distribution channels. results, see ""Basis for Financial Presentation'' on page 43
The Company has six reportable operating segments: and Table 21 ""Line of Business Financial Performance''
Wholesale Banking oÅers lending, depository, treasury included in Management's Discussion and Analysis which is
management and other Ñnancial services to middle market, incorporated by reference into these Notes to Consolidated
large corporate and public sector clients. Financial Statements.
Consumer Banking delivers products and services to the
broad consumer market and small businesses through SECURITIES
banking oÇces, telemarketing, on-line services, direct mail
Trading Account Securities Debt and equity securities
and automated teller machines (""ATMs''). It encompasses
held for resale are classiÑed as trading account securities
community banking, metropolitan banking, small business
and reported at fair value. Realized and unrealized gains or
banking, consumer lending, mortgage banking, and
losses are determined on a trade date basis and reported in
investment product sales.
noninterest income.
Private Client, Trust and Asset Management provides
mutual fund processing services, trust, private banking and Available-for-sale Securities These securities are not
Ñnancial advisory services through four businesses including: trading account securities but may be sold before maturity
the Private Client Group, Corporate Trust Services, in response to changes in the Company's interest rate risk
U.S. Bancorp
Note 1
53