US Bank 2007 Annual Report Download - page 21

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share, in 2006. Return on average assets and return on
average common equity were 1.93 percent and 21.3 percent,
respectively, in 2007, compared with returns of 2.23 percent
and 23.6 percent, respectively, in 2006. The decline in the
Company’s net income was driven by several significant
items discussed below and management’s decision to further
invest in payment services businesses, geographical presence,
technology, relationship management and other customer
service initiatives and product innovations. Also, credit
losses increased in 2007 due to loan portfolio growth,
somewhat higher levels of nonperforming assets from stress
in the mortgage lending and homebuilding industries and
deterioration in consumer credit quality experienced
throughout the banking industry.
U.S. BANCORP 19
Table 1 SELECTED FINANCIAL DATA
Year Ended December 31
(Dollars and Shares in Millions, Except Per Share Data) 2007 2006 2005 2004 2003
Condensed Income Statement
Net interest income (taxable-equivalent basis) (a) . . . . . . . . $ 6,764 $ 6,790 $ 7,088 $ 7,140 $ 7,217
Noninterest income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,157 6,832 6,151 5,624 5,068
Securities gains (losses), net . . . . . . . . . . . . . . . . . . . . . . 15 14 (106) (105) 245
Total net revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,936 13,636 13,133 12,659 12,530
Noninterest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,862 6,180 5,863 5,785 5,597
Provision for credit losses . . . . . . . . . . . . . . . . . . . . . . . . 792 544 666 669 1,254
Income from continuing operations before taxes . . . . . . . 6,282 6,912 6,604 6,205 5,679
Taxable-equivalent adjustment . . . . . . . . . . . . . . . . . . . . . 75 49 33 29 28
Applicable income taxes . . . . . . . . . . . . . . . . . . . . . . . . . 1,883 2,112 2,082 2,009 1,941
Income from continuing operations . . . . . . . . . . . . . . . . 4,324 4,751 4,489 4,167 3,710
Discontinued operations (after-tax) . . . . . . . . . . . . . . . . . . – – – – 23
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,324 $ 4,751 $ 4,489 $ 4,167 $ 3,733
Net income applicable to common equity . . . . . . . . . . . . $ 4,264 $ 4,703 $ 4,489 $ 4,167 $ 3,733
Per Common Share
Earnings per share from continuing operations . . . . . . . . . . $ 2.46 $ 2.64 $ 2.45 $ 2.21 $ 1.93
Diluted earnings per share from continuing operations . . . . . 2.43 2.61 2.42 2.18 1.92
Earnings per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.46 2.64 2.45 2.21 1.94
Diluted earnings per share . . . . . . . . . . . . . . . . . . . . . . . . 2.43 2.61 2.42 2.18 1.93
Dividends declared per share . . . . . . . . . . . . . . . . . . . . . . 1.625 1.390 1.230 1.020 .855
Book value per share . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.60 11.44 11.07 10.52 10.01
Market value per share . . . . . . . . . . . . . . . . . . . . . . . . . . 31.74 36.19 29.89 31.32 29.78
Average common shares outstanding . . . . . . . . . . . . . . . . 1,735 1,778 1,831 1,887 1,924
Average diluted common shares outstanding . . . . . . . . . . . 1,758 1,804 1,857 1,913 1,936
Financial Ratios
Return on average assets . . . . . . . . . . . . . . . . . . . . . . . . 1.93% 2.23% 2.21% 2.17% 1.99%
Return on average common equity . . . . . . . . . . . . . . . . . . 21.3 23.6 22.5 21.4 19.2
Net interest margin (taxable-equivalent basis) (a). . . . . . . . . 3.47 3.65 3.97 4.25 4.49
Efficiency ratio (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.3 45.4 44.3 45.3 45.6
Average Balances
Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $147,348 $140,601 $131,610 $120,670 $116,937
Loans held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,298 3,663 3,290 3,079 5,041
Investment securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,313 39,961 42,103 43,009 37,248
Earning assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 194,683 186,231 178,425 168,123 160,808
Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223,621 213,512 203,198 191,593 187,630
Noninterest-bearing deposits . . . . . . . . . . . . . . . . . . . . . . 27,364 28,755 29,229 29,816 31,715
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121,075 120,589 121,001 116,222 116,553
Short-term borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . 28,925 24,422 19,382 14,534 10,503
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,560 40,357 36,141 35,115 33,663
Shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,997 20,710 19,953 19,459 19,393
Period End Balances
Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $153,827 $143,597 $136,462 $124,941 $116,811
Allowance for credit losses. . . . . . . . . . . . . . . . . . . . . . . . 2,260 2,256 2,251 2,269 2,369
Investment securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,116 40,117 39,768 41,481 43,334
Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237,615 219,232 209,465 195,104 189,471
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131,445 124,882 124,709 120,741 119,052
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,440 37,602 37,069 34,739 33,816
Shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,046 21,197 20,086 19,539 19,242
Regulatory capital ratios
Tier 1 capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.3% 8.8% 8.2% 8.6% 9.1%
Total risk-based capital. . . . . . . . . . . . . . . . . . . . . . . . . 12.2 12.6 12.5 13.1 13.6
Leverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.9 8.2 7.6 7.9 8.0
Tangible common equity . . . . . . . . . . . . . . . . . . . . . . . . 5.1 5.5 5.9 6.4 6.5
(a) Presented on a fully taxable-equivalent basis utilizing a tax rate of 35 percent.
(b) Computed as noninterest expense divided by the sum of net interest income on a taxable-equivalent basis and noninterest income excluding securities gains (losses), net.