US Bank 2014 Annual Report Download - page 68

Noninterest expense in the fourth quarter of 2014 was
$122 million (4.5 percent) higher than the fourth quarter of
2013, primarily due to accruals related to certain legal
matters, charitable contributions and higher compensation
expense, reflecting the impact of merit increases,
acquisitions and higher staffing for risk, compliance and
internal audit activities.
Fourth quarter 2014 net interest income, on a taxable-
equivalent basis, was $2.8 billion, compared with $2.7 billion
in the fourth quarter of 2013. The $66 million (2.4 percent)
increase was principally the result of growth in average
earning assets and lower cost core deposit funding, partially
offset by lower rates on new loans and investment securities
and lower loan fees. Average earning assets were
$35.4 billion (11.1 percent) higher in the fourth quarter of
2014 compared with the same period of 2013, driven by
increases in loans and investment securities. The net
interest margin, on a taxable-equivalent basis, in the fourth
quarter of 2014 was 3.14 percent, compared with 3.40
percent in the fourth quarter of 2013, reflecting lower
reinvestment rates on investment securities, as well as
growth in the investment portfolio at lower average rates,
lower loan fees due to the wind down of the CAA product, and
strong growth in lower rate commercial loans, partially offset
by lower funding costs.
TABLE 23 FOURTH QUARTER RESULTS
Three Months Ended
December 31,
(Dollars and Shares in Millions, Except Per Share Data) 2014 2013
Condensed Income Statement
Net interest income (taxable-equivalent basis)(a) ........................................................................... $2,799 $2,733
Noninterest income ........................................................................................................ 2,369 2,155
Securities gains (losses), net ............................................................................................... 11
Total net revenue ........................................................................................................ 5,169 4,889
Noninterest expense ....................................................................................................... 2,804 2,682
Provision for credit losses .................................................................................................. 288 277
Income before taxes ..................................................................................................... 2,077 1,930
Taxable-equivalent adjustment............................................................................................. 55 56
Applicable income taxes ................................................................................................... 521 403
Net income .............................................................................................................. 1,501 1,471
Net (income) loss attributable to noncontrolling interests ............................................................... (13) (15)
Net income attributable to U.S. Bancorp ................................................................................ $1,488 $1,456
Net income applicable to U.S. Bancorp common shareholders .......................................................... $1,420 $1,389
Per Common Share
Earnings per share ......................................................................................................... $ .79 $ .76
Diluted earnings per share ................................................................................................. $ .79 $ .76
Dividends declared per share .............................................................................................. $ .245 $ .230
Average common shares outstanding ...................................................................................... 1,787 1,821
Average diluted common shares outstanding .............................................................................. 1,796 1,832
Financial Ratios
Return on average assets .................................................................................................. 1.50% 1.62%
Return on average common equity ......................................................................................... 14.4 15.4
Net interest margin (taxable-equivalent basis)(a) ........................................................................... 3.14 3.40
Efficiency ratio ............................................................................................................. 54.3 54.9
(a) Interest and rates are presented on a fully taxable-equivalent basis utilizing a tax rate of 35 percent.
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