US Bank 2002 Annual Report Download - page 33

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workout activities, and reclassifications to other loan (5.9 percent). Included in the change in commercial real
categories. Included in the change for commercial loans was estate loans at year-end was a net reclassification of
a reclassification of approximately $1.2 billion from approximately $.5 billion to the commercial real estate loan
commercial loans predominately to the commercial real category predominately from the commercial loan category.
estate ($.5 billion) and residential mortgages ($.7 billion) Commercial mortgages outstanding increased by
loan categories in 2002. Average commercial loans in 2002 $1.6 billion (8.3 percent), driven by loan reclassifications
decreased by $6.3 billion (12.5 percent). Approximately and growth in small business administration lending, while
$721 million of the change in average commercial loans real estate construction and development loans remained
year-over-year for 2002 was due to the transfer of high essentially flat compared with a year ago. Average
credit quality commercial loans to the loan conduit. Also commercial real estate loans were essentially flat at
impacting the decline in average commercial loans was the $25.7 billion in 2002, compared with $26.1 billion in 2001.
transfer of $680 million in unsecured small business Table 9 provides a summary of commercial real estate
product to loans held for sale in 2001. On a core basis, exposures by property type and geographic location.
average commercial loans decreased by $5.3 billion The Company maintains the real estate construction
(9.9 percent) relative to the prior year. designation until the project is producing sufficient cash
Table 8 provides a summary of commercial loans by flow to service traditional mortgage financing, at which
industry and geographic locations. time, if retained, the loan is transferred to the commercial
mortgage portfolio. Approximately $1.4 billion of
Commercial Real Estate The Company’s portfolio of construction loans were permanently financed and
commercial real estate loans, which includes commercial transferred to the commercial mortgage loan category in
mortgages and construction loans, was $26.9 billion at 2002. At year-end 2002, $182 million of tax-exempt
December 31, 2002, compared with $25.4 billion at industrial development loans were secured by real estate.
December 31, 2001, an increase of $1.5 billion
Commercial Real Estate Exposure by Property Type and Geography
December 31, 2002 December 31, 2001
Property Type (Dollars in Millions) Loans Percent Loans Percent
Business owner occupied******************************************** $ 6,513 24.2% $ 5,159 20.3%
Multi-family********************************************************* 3,258 12.1 2,842 11.2
Commercial property
Industrial ******************************************************* 1,227 4.6 1,995 7.9
Office ********************************************************** 3,564 13.3 2,948 11.6
Retail ********************************************************** 3,832 14.3 2,704 10.7
Other ********************************************************** 1,447 5.4 1,949 7.7
Homebuilders ****************************************************** 2,142 8.0 1,417 5.6
Hotel/motel********************************************************* 2,585 9.6 1,985 7.8
Health care facilities************************************************* 1,290 4.8 1,183 4.7
Other************************************************************** 1,009 3.7 3,191 12.5
Total *********************************************************** $26,867 100.0% $25,373 100.0%
Geography
California ********************************************************** $ 4,277 15.9% $ 3,399 13.4%
Colorado*********************************************************** 1,190 4.4 840 3.3
Illinois ************************************************************* 1,140 4.2 1,581 6.2
Minnesota ********************************************************* 1,508 5.6 1,401 5.5
Missouri *********************************************************** 2,297 8.6 2,439 9.6
Ohio ************************************************************** 2,264 8.4 2,274 9.0
Oregon ************************************************************ 1,614 6.0 1,427 5.6
Washington ******************************************************** 3,242 12.1 2,671 10.5
Wisconsin********************************************************** 2,040 7.6 2,128 8.4
Iowa, Kansas, Nebraska, North Dakota, South Dakota ****************** 1,895 7.1 2,016 8.0
Arkansas, Indiana, Kentucky, Tennessee ****************************** 1,679 6.2 2,055 8.1
Idaho, Montana, Wyoming ******************************************* 682 2.5 690 2.7
Arizona, Nevada, Utah ********************************************** 1,439 5.4 1,182 4.7
Total banking region ********************************************* 25,267 94.0 24,103 95.0
Outside the Company’s banking region******************************** 1,600 6.0 1,270 5.0
Total *********************************************************** $26,867 100.0% $25,373 100.0%
U.S. Bancorp 31
Table 9