US Bank 2005 Annual Report Download - page 52

REGULATORY CAPITAL RATIOS
At December 31 (Dollars in Millions) 2005 2004
U.S. Bancorp
Tangible common equity ************************************************************************************** $11,873 $11,950
As a percent of tangible assets ***************************************************************************** 5.9% 6.4%
Tier 1 capital ************************************************************************************************ $15,145 $14,720
As a percent of risk-weighted assets ************************************************************************ 8.2% 8.6%
As a percent of adjusted quarterly average assets (leverage ratio) *********************************************** 7.6% 7.9%
Total risk-based capital *************************************************************************************** $23,056 $22,352
As a percent of risk-weighted assets ************************************************************************ 12.5% 13.1%
Bank Subsidiaries
U.S. Bank National Association
Tier 1 capital ****************************************************************************************** 6.5% 6.5%
Total risk-based capital ********************************************************************************* 10.7 10.9
Leverage ********************************************************************************************* 5.9 5.9
U.S. Bank National Association ND
Tier 1 capital ****************************************************************************************** 12.9% 12.7%
Total risk-based capital ********************************************************************************* 17.0 17.2
Leverage ********************************************************************************************* 11.2 10.8
Well-
Bank Regulatory Capital Requirements Minimum Capitalized
Tier 1 capital ****************************************************************************************** 4.0% 6.0%
Total risk-based capital ********************************************************************************* 8.0 10.0
Leverage ********************************************************************************************* 4.0 5.0
next 24 months. This new authorization replaced the exceed the ‘‘well-capitalized’’ threshold for these ratios of
December 16, 2003, authorization. During 2004, the 6.0 percent, 10.0 percent, and 5.0 percent, respectively. All
Company purchased 5 million shares of common stock regulatory ratios, at both the bank and bank holding
under the plan. The average price paid for the 94 million company level, continue to be in excess of stated
shares repurchased during 2004 was $28.34 per share. In ‘‘well-capitalized’’ requirements.
2005, the Company purchased 62 million shares under the Table 21 provides a summary of capital ratios as of
2004 plan. The average price paid for the shares December 31, 2005 and 2004, including Tier 1 and total
repurchased in 2005 was $29.37 per share. For a complete risk-based capital ratios, as defined by the regulatory
analysis of activities impacting shareholders’ equity and agencies. During 2006, the Company expects to target
capital management programs, refer to Note 16 of the capital level ratios of 8.5 percent Tier 1 capital and
Notes to Consolidated Financial Statements. 12.0 percent total risk-based capital on a consolidated basis.
The following table provides a detailed analysis of all
FOURTH QUARTER SUMMARY
shares repurchased under this authorization during the
The Company reported net income of $1,143 million for
fourth quarter of 2005:
the fourth quarter of 2005, or $.62 per diluted share,
Number of Average Remaining Shares
Shares Price Paid Available to be compared with $1,056 million, or $.56 per diluted share,
Time Period Purchased (a) Per Share Purchased for the fourth quarter of 2004. Return on average assets
October ******** 2,188,324 $28.16 89,927,218 and return on average equity were 2.18 percent and
November ****** 1,581,814 29.93 88,345,404
22.6 percent, respectively, for the fourth quarter of 2005,
December ****** 4,860,184 30.65 83,485,220
compared with returns of 2.16 percent and 21.2 percent,
Total ******** 8,630,322 $29.89 83,485,220
respectively, for the fourth quarter of 2004. The Company’s
(a) All shares purchased during the fourth quarter of 2005 were purchased under the results for the fourth quarter of 2005 improved over the
publicly announced December 21, 2004, repurchase authorization.
same period of 2004, as net income rose by $87 million
Banking regulators define minimum capital (8.2 percent), primarily due to growth in fee-based products
requirements for banks and financial services holding and services and a debt restructuring charge taken in the
companies. These requirements are expressed in the form of fourth quarter of 2004, partially offset by a release of the
a minimum Tier 1 capital ratio, total risk-based capital loan loss allowance in the fourth quarter of 2004. In
ratio, and Tier 1 leverage ratio. The minimum required level addition, income tax expense was lower in the fourth
for these ratios is 4.0 percent, 8.0 percent, and 4.0 percent, quarter of 2005, driven by the timing of investments that
respectively. The Company targets its regulatory capital generate incremental tax credits. In addition, the Company’s
levels, at both the bank and bank holding company level, to
50 U.S. BANCORP
Table 21