US Bank 2012 Annual Report Download - page 49

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continued to reduce exposure to these problem assets, as well
as improvement in commercial mortgages and other
commercial loan portfolios. These decreases were partially
offset by increases in nonperforming residential mortgages
and other retail loans. These increases were principally the
result of a regulatory clarification in the treatment of
residential mortgage and other consumer loans to borrowers
who have had debt discharged through bankruptcy, and the
inclusion, beginning in the second quarter of 2012, of junior
lien loans and lines greater than 120 days past due, as well as
junior lien loans behind a first lien greater than 180 days past
due or on nonaccrual status, as nonperforming loans. These
changes did not have a material impact on the Company’s
allowance for credit losses. Nonperforming covered assets at
December 31, 2012 were $583 million, compared with
$1.2 billion at December 31, 2011 and $1.7 billion at
December 31, 2010. These assets are covered by loss sharing
agreements with the FDIC that substantially reduce the risk of
credit losses to the Company. The ratio of total
nonperforming assets to total loans and other real estate was
1.19 percent (.98 percent excluding covered assets) at
December 31, 2012, compared with 1.79 percent
(1.32 percent excluding covered assets) at December 31, 2011
and 2.55 percent (1.87 percent excluding covered assets) at
December 31, 2010.
Other real estate owned, excluding covered assets, was
$381 million at December 31, 2012, compared with
$404 million at December 31, 2011 and $511 million at
December 31, 2010, and was related to foreclosed properties
that previously secured loan balances. Other real estate owned
includes properties vacated by the borrower and maintained
by Company, regardless of whether title in the property has
transferred to the Company.
The following table provides an analysis of other real estate
owned, excluding covered assets, as a percent of their related
loan balances, including geographical location detail for
residential (residential mortgage, home equity and second
mortgage) and commercial (commercial and commercial real
estate) loan balances:
At December 31,
(Dollars in Millions)
Amount
As a Percent of Ending
Loan Balances
2012 2011 2012 2011
Residential
Minnesota ................ $ 20 $ 22 .34% .39%
Illinois .................... 19 10 .55 .31
California ................. 16 16 .18 .22
Washington .............. 14 6 .38 .18
Florida .................... 14 5 1.55 .60
All other states ........... 185 92 .49 .26
Total residential ........ 268 151 .44 .27
Commercial
Missouri .................. 17 5 .37 .12
Nevada ................... 11 44 .87 3.13
Arizona ................... 10 16 .83 1.41
California ................. 8 26 .05 .18
Washington .............. 7 9 .11 .15
All other states ........... 60 153 .08 .23
Total commercial ...... 113 253 .11 .27
Total ................... $381 $404 .18% .21%
U.S. BANCORP 45