US Bank 2011 Annual Report Download - page 58

TABLE 23 Fourth Quarter Results
Three Months Ended
December 31,
(Dollars and Shares in Millions, Except Per Share Data) 2011 2010
Condensed Income Statement
Net interest income (taxable-equivalent basis) (a) ................................................................. $2,673 $2,499
Noninterest income ................................................................................................ 2,440 2,236
Securities gains (losses), net....................................................................................... (9) (14)
Total net revenue ............................................................................................... 5,104 4,721
Noninterest expense ............................................................................................... 2,696 2,485
Provision for credit losses ......................................................................................... 497 912
Income before taxes ............................................................................................ 1,911 1,324
Taxable-equivalent adjustment .................................................................................... 56 53
Applicable income taxes ........................................................................................ 527 315
Net income ...................................................................................................... 1,328 956
Net (income) loss attributable to noncontrolling interests ....................................................... 22 18
Net income attributable to U.S. Bancorp ....................................................................... $1,350 $ 974
Net income applicable to U.S. Bancorp common shareholders ................................................ $1,314 $ 951
Per Common Share
Earnings per share ................................................................................................. $ .69 $ .50
Diluted earnings per share ......................................................................................... $ .69 $ .49
Dividends declared per share...................................................................................... $ .125 $ .050
Average common shares outstanding ............................................................................. 1,904 1,914
Average diluted common shares outstanding ..................................................................... 1,911 1,922
Financial Ratios
Return on average assets.......................................................................................... 1.62% 1.31%
Return on average common equity ................................................................................ 16.8 13.7
Net interest margin (taxable-equivalent basis) (a) .................................................................. 3.60 3.83
Efficiency ratio ..................................................................................................... 52.7 52.5
(a) Interest and rates are presented on a fully taxable-equivalent basis utilizing a tax rate of 35 percent.
Government National Mortgage Association, Federal Home
Loan Mortgage Corporation and the Federal National
Mortgage Association. At December 31, 2011, U.S. Bank
National Association met these requirements.
Table 22 provides a summary of capital ratios as of
December 31, 2011 and 2010, including Tier 1 and total risk-
based capital ratios, as defined by the regulatory agencies.
The Company believes certain capital ratios in addition
to regulatory capital ratios are useful in evaluating its capital
adequacy. The Company’s Tier 1 common equity (using Basel
I definition) and tangible common equity, as a percent of risk-
weighted assets, were 8.6 percent and 8.1 percent,
respectively, at December 31, 2011, compared with 7.8
percent and 7.2 percent, respectively, at December 31, 2010.
The Company’s tangible common equity divided by tangible
assets was 6.6 percent at December 31, 2011, compared with
6.0 percent at December 31, 2010. Additionally, the
Company’s Tier 1 common as a percent of risk-weighted
assets, under the anticipated Basel III definition as if fully
implemented, was 8.2 percent at December 31, 2011,
compared with 7.3 percent at December 31, 2010. Refer to
“Non-GAAP Financial Measures” for further information
regarding the calculation of these ratios.
Fourth Quarter Summary
The Company reported net income attributable to
U.S. Bancorp of $1.4 billion for the fourth quarter of 2011, or
$.69 per diluted common share, compared with $974 million,
or $.49 per diluted common share, for the fourth quarter of
2010. Return on average assets and return on average
common equity were 1.62 percent and 16.8 percent,
respectively, for the fourth quarter of 2011, compared with
returns of 1.31 percent and 13.7 percent, respectively, for the
fourth quarter of 2010. Significant items in the fourth quarter
2011 that impact the comparison of results included the $263
million merchant settlement gain, the $130 million expense
accrual related to mortgage servicing matters, a provision for
credit losses less than net charge-offs by $125 million and net
securities losses of $9 million. Included in the fourth quarter
2010 results were the $103 million ($41 million after tax)
Nuveen gain, a provision for credit losses less than net charge-
offs by $25 million and net securities losses of $14 million.
Total net revenue, on a taxable-equivalent basis for the
fourth quarter of 2011, was $383 million (8.1 percent) higher
than the fourth quarter of 2010, reflecting a 7.0 percent
increase in net interest income and a 9.4 percent increase in
56 U.S. BANCORP