US Bank 2012 Annual Report Download - page 114

The following table provides the components of the Company’s regulatory capital at December 31:
(Dollars in Millions) 2012 2011
Tier 1 Capital
Common shareholders’ equity .................................................................................... $ 34,229 $ 31,372
Qualifying preferred stock ........................................................................................ 4,769 2,606
Qualifying trust preferred securities ............................................................................... – 2,675
Noncontrolling interests, less preferred stock not eligible for Tier 1 capital ....................................... 685 687
Less intangible assets
Goodwill (net of deferred tax liability)........................................................................... (8,351) (8,239)
Other disallowed intangible assets ............................................................................. (829) (905)
Other (a) .......................................................................................................... 700 977
Total Tier 1 Capital .......................................................................................... 31,203 29,173
Tier 2 Capital
Eligible portion of allowance for credit losses .................................................................... 3,609 3,412
Eligible subordinated debt ........................................................................................ 2,953 3,469
Other .............................................................................................................. 15 13
Total Tier 2 Capital .......................................................................................... 6,577 6,894
Total Risk Based Capital .................................................................................... $ 37,780 $ 36,067
Risk-Weighted Assets ......................................................................................... $287,611 $271,333
(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 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 each
fifth anniversary after the dividend payment date occurring in
January 2012, and in whole but not in part, at the option of
USB Realty Corp. on any dividend date 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 15 Earnings Per Share
The components of earnings per share were:
Year Ended December 31
(Dollars and Shares in Millions, Except Per Share Data) 2012 2011 2010
Net income attributable to U.S. Bancorp ................................................................... $5,647 $4,872 $3,317
Preferred dividends......................................................................................... (238) (129) (89)
Equity portion of gain on ITS exchange transaction, net of tax (a) .......................................... – – 118
Earnings allocated to participating stock awards ........................................................... (26) (22) (14)
Net income applicable to U.S. Bancorp common shareholders ......................................... $5,383 $4,721 $3,332
Average common shares outstanding ...................................................................... 1,887 1,914 1,912
Net effect of the exercise and assumed purchase of stock awards and conversion of outstanding
convertible notes ........................................................................................ 9 9 9
Average diluted common shares outstanding .............................................................. 1,896 1,923 1,921
Earnings per common share ............................................................................... $ 2.85 $ 2.47 $ 1.74
Diluted earnings per common share ........................................................................ $ 2.84 $ 2.46 $ 1.73
(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.
110 U.S. BANCORP