US Bank 2005 Annual Report Download - page 41

Download and view the complete annual report

Please find page 41 of the 2005 US Bank annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 130

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130

bankruptcy filings that occurred in late 2005 will result in The following table provides an analysis of net charge-
lower bankruptcy filings through the first half of 2006 before offs as a percentage of average loans outstanding managed
returning to more normalized levels. Lower levels of retail by the consumer finance division, compared with traditional
loan net charge-offs in 2004, compared with 2003, branch related loans:
principally reflected changes by the Company in Average Loan Percent of
Amount Average Loans
underwriting, ongoing collection efforts and other risk Year Ended December 31
(Dollars in Millions) 2005 2004 2005 2004
management activities. The decline also reflected lower
delinquency ratios from 2003 as the economy continued to Consumer Finance (a)
Residential mortgages ***** $ 5,947 $ 4,531 .52% .44%
improve.
Home equity and second
The Company’s retail lending business utilizes several mortgages ************ 2,431 2,412 1.81 2.07
distinct business processes and channels to originate retail Other retail *************** 393 414 5.09 5.07
credit including traditional branch credit, indirect lending
Traditional Branch
and a consumer finance division. Each distinct underwriting Residential mortgages ***** $12,089 $ 9,791 .04% .09%
and origination activity manages unique credit risk Home equity and second
characteristics and prices its loan production commensurate mortgages ************ 12,514 11,628 .19 .22
with the differing risk profiles. Within Consumer Banking, Other retail *************** 15,165 14,007 1.10 1.10
U.S. Bank Consumer Finance (‘‘USBCF’’) participates in all Total Company
facets of the Company’s consumer lending activities. USBCF Residential mortgages ***** $18,036 $14,322 .20% .20%
specializes in serving channel-specific and alternative lending Home equity and second
mortgages ************ 14,945 14,040 .46 .54
markets in residential mortgages, home equity and
Other retail *************** 15,558 14,421 1.20 1.21
installment loan financing. USBCF manages loans originated
(a) Consumer finance category included credit originated and managed by USBCF, as well
through a broker network, correspondent relationships and
as home equity and second mortgages with a loan-to-value greater than 100 percent
U.S. Bank branch offices. Generally, loans managed by the that were originated in the branches.
Company’s consumer finance division exhibit higher credit
risk characteristics, but are priced commensurate with the
differing risk profile.
U.S. BANCORP 39