US Bank 2004 Annual Report Download - page 33
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Please find page 33 of the 2004 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.2003. The increase in residential mortgages was primarily primarily reflected the sale of $8.2 billion of fixed-rate
the result of asset/liability risk management decisions to investment securities, along with maturities and
retain a greater portion of the Company’s adjustable-rate prepayments of $12.3 billion, partially offset by purchases
loan production. This growth was partially offset by of $19.6 billion of securities. Investment securities purchases
approximately $.5 billion in residential loan sales during were principally adjustable and shorter-term fixed-rate
2004 primarily representing fixed-rate mortgage loans. mortgage-backed securities, giving consideration to the
Average residential mortgages increased $2.6 billion Company’s overall asset/liability position, actual and
(22.5 percent) to $14.3 billion in 2004, primarily due to projected changes in the mix and characteristics of the
retaining adjustable-rate residential mortgages throughout balance sheet and in interest rates. At December 31, 2004,
2004 and growth in first-lien home equity loans of approximately 38.9 percent of the investment securities
20.0 percent. portfolio represented adjustable-rate financial instruments,
compared with 22.2 percent as of December 31, 2003.
Retail Total retail loans outstanding, which include credit Adjustable-rate financial instruments include variable-rate
card, retail leasing, home equity and second mortgages and collateralized mortgage obligations, mortgage-backed
other retail loans, were $43.2 billion at December 31, 2004, securities, agency securities, adjustable-rate money market
compared with $39.0 billion at December 31, 2003. The accounts and asset-backed securities. Average investment
increase of $4.2 billion (10.7 percent) was driven by an securities were $43.0 billion in 2004, compared with
increase in home equity lines of credit, credit cards, retail $37.2 billion in 2003. The increase principally reflects the
leasing, automobile loans and installment loans, which timing of securities transactions in early 2004 as proceeds
increased $2,275 million, $670 million, $1,137 million, from loan repayments and deposit growth were reinvested
$254 million and $387 million, respectively, during 2004. in this asset category.
The increases in these loan categories were offset somewhat The weighted-average yield of the available-for-sale
by a reduction in home equity loans of $634 million during portfolio was 4.43 percent at December 31, 2004,
the year. Average retail loans increased $3.0 billion compared with 4.27 percent at December 31, 2003. The
(7.9 percent) to $41.2 billion in 2004, reflecting growth in average maturity of the available-for-sale portfolio declined
home equity lines, retail leasing, installment loans and credit to 4.5 years at December 31, 2004, down from 5.1 years at
card. Of the total retail loans and residential mortgages December 31, 2003. The relative mix of the type of
outstanding, approximately 87.4 percent are to customers investment securities maintained in the portfolio is provided
located in the Company’s primary banking regions. in Table 10. At December 31, 2004, the available-for-sale
Loans Held for Sale At December 31, 2004, loans held for portfolio included a $271 million net unrealized loss,
sale, consisting of residential mortgages to be sold in the compared with a net unrealized loss of $259 million at
secondary market, were $1.4 billion. This asset category December 31, 2003.
was essentially unchanged relative to loans held for sale at Deposits Total deposits were $120.7 billion at
December 31, 2003, despite $4.4 billion of mortgage loan December 31, 2004, an increase of $1.7 billion
production during the fourth quarter of 2004, compared (1.4 percent) from December 31, 2003. The increase in total
with $3.9 billion in fourth quarter 2003. Average loans held deposits was primarily the result of an increase in time
for sale declined to $1.6 billion in 2004, compared with deposits greater than $100,000, partially offset by decreases
$3.6 billion in 2003, due to the impact of rising interest in noninterest-bearing deposits, savings deposits and time
rates on mortgage loan production. certificates of deposit less than $100,000. Average total
Investment Securities The Company uses its investment deposits were $116.2 billion in 2004, declining
securities portfolio for several purposes. It serves as a $331 million from $116.6 billion in 2003. The decline in
vehicle to manage interest rate and prepayment risk, average total deposits was primarily due to lower average
generates interest and dividend income from the investment noninterest-bearing deposits and time certificates of deposit
of excess funds depending on loan demand, provides less than $100,000. The reductions in these categories were
liquidity and is used as collateral for public deposits and offset somewhat by growth in average savings deposits and
wholesale funding sources. While it is the Company’s intent time deposits greater than $100,000.
to hold its investment securities indefinitely, the Company Noninterest-bearing deposits were $30.8 billion at
may take actions in response to structural changes in December 31, 2004, compared with $32.5 billion at
interest rate risks and to meet liquidity requirements. December 31, 2003, a decrease of $1.7 billion (5.3 percent).
At December 31, 2004, investment securities, both The decrease in noninterest-bearing deposits was primarily
available-for-sale and held-to-maturity, totaled attributable to declining deposits related to corporate
$41.5 billion, compared with $43.3 billion at December 31, business deposits, mortgage banking businesses and
2003. The $1.9 billion (4.3 percent) year-over-year decrease
U.S. BANCORP 31