US Bank 2011 Annual Report Download - page 103

The following table provides the components of the
Company's regulatory capital at December 31:
(Dollars in Millions) 2011 2010
Tier 1 Capital
Common shareholders' equity ............ $ 31,372 $ 27,589
Qualifying preferred stock ................. 2,606 1,930
Qualifying trust preferred securities ....... 2,675 3,949
Noncontrolling interests, less preferred
stock not eligible for Tier 1 capital ...... 687 692
Less intangible assets
Goodwill (net of deferred tax liability) . . . (8,239) (8,337)
Other disallowed intangible assets ..... (905) (1,097)
Other (a) ................................... 977 1,221
Total Tier 1 Capital ................... 29,173 25,947
Tier 2 Capital
Eligible portion of allowance for credit
losses .................................. 3,412 3,125
Eligible subordinated debt ................ 3,469 3,943
Other ...................................... 13 18
Total Tier 2 Capital ..................... 6,894 7,086
Total Risk Based Capital ............... $ 36,067 $ 33,033
Risk-Weighted Assets .................... $271,333 $247,619
(a) Includes the impact of items included in other comprehensive income (loss), such as
unrealized gains (losses) on available-for-sale securities, accumulated net gains on cash
flow hedges, pension liability adjustments, etc.
Noncontrolling interests principally represent preferred
stock of consolidated subsidiaries. During 2006, the
Company’s primary banking subsidiary formed USB Realty
Corp., a real estate investment trust, for the purpose of issuing
5,000 shares of Fixed-to-Floating Rate Exchangeable
Non-cumulative Perpetual Series A Preferred Stock with a
liquidation preference of $100,000 per share (“Series A
Preferred Securities”) to third party investors, and investing
the proceeds in certain assets, consisting predominately of
mortgage-backed securities from the Company. Dividends on
the Series A Preferred Securities, if declared, will accrue and
be payable quarterly, in arrears, at a rate per annum of 6.091
percent from December 22, 2006 to, but excluding,
January 15, 2012. After January 15, 2012, the rate will be
equal to three-month LIBOR plus 1.147 percent. If USB
Realty Corp. has not declared a dividend on the Series A
Preferred Securities before the dividend payment date for any
dividend period, such dividend shall not be cumulative and
shall cease to accrue and be payable, and USB Realty Corp.
will have no obligation to pay dividends accrued for such
dividend period, whether or not dividends on the Series A
Preferred Securities are declared for any future dividend
period.
The Series A Preferred Securities will be redeemable, in
whole or in part, at the option of USB Realty Corp. on the
dividend payment date occurring in January 2012 and each
fifth anniversary thereafter, or in whole but not in part, at the
option of USB Realty Corp. on any dividend date before or
after January 2012 that is not a five-year date. Any
redemption will be subject to the approval of the Office of the
Comptroller of the Currency.
NOTE 16 Earnings Per Share
The components of earnings per share were:
Year Ended December 31
(Dollars and Shares in Millions, Except Per Share Data) 2011 2010 2009
Net income attributable to U.S. Bancorp ................................................................... $4,872 $3,317 $2,205
Preferred dividends......................................................................................... (129) (89) (228)
Equity portion of gain on ITS exchange transaction, net of tax (a) .......................................... — 118 —
Accretion of preferred stock discount ...................................................................... — — (14)
Deemed dividend on preferred stock redemption (b) ....................................................... — — (154)
Earnings allocated to participating stock awards ........................................................... (22) (14) (6)
Net income applicable to U.S. Bancorp common shareholders ....................................... $4,721 $3,332 $1,803
Average common shares outstanding ...................................................................... 1,914 1,912 1,851
Net effect of the exercise and assumed purchase of stock awards and conversion of outstanding
convertible notes ........................................................................................ 9 9 8
Average diluted common shares outstanding .............................................................. 1,923 1,921 1,859
Earnings per common share ............................................................................... $ 2.47 $ 1.74 $ .97
Diluted earnings per common share ........................................................................ $ 2.46 $ 1.73 $ .97
(a) During 2010, the Company exchanged depositary shares representing an ownership interest in 5,746 shares of Series A Preferred Stock for approximately 46 percent of the outstanding ITS
issued by USB Capital IX to third party investors, retired a pro-rata portion of the related junior subordinated debentures and cancelled a pro-rata portion of the related stock purchase
contracts.
(b) Represents the unaccreted discount remaining on the Company's Series E Fixed Rate Cumulative Perpetual Preferred Stock at the redemption date.
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