US Bank 2015 Annual Report Download - page 68
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tier 1 capital ratio, tier 1 capital ratio, total risk-based capital
ratio, and tier 1 leverage ratio was 6.5 percent, 8.0 percent,
10.0 percent and 5.0 percent, respectively. The most recent
notification from the Office of the Comptroller of the Currency
categorized the Company’s bank subsidiary as “well-
capitalized” under the FDIC Improvement Act prompt
corrective action provisions that are applicable to all banks.
There are no conditions or events since that notification that
management believes have changed the risk-based category
of its covered subsidiary bank.
As an approved mortgage seller and servicer, U.S. Bank
National Association, through its mortgage banking division, is
required to maintain various levels of shareholder’s equity, as
specified by various agencies, including the United States
Department of Housing and Urban Development, Government
National Mortgage Association, Federal Home Loan Mortgage
Corporation and the Federal National Mortgage Association.
At December 31, 2015, U.S. Bank National Association met
these requirements.
Table 23 provides a summary of statutory regulatory
capital ratios in effect for the Company at December 31, 2015
and 2014.
During 2014, U.S. banking regulators approved a final
regulatory Supplementary Leverage Ratio (“SLR”) requirement
for banks calculating capital adequacy using advanced
approaches under Basel III. The SLR is defined as tier 1
capital divided by total leverage exposure, which includes
both on- and off-balance sheet exposures. At December 31,
2015, the Company’s SLR exceeds the applicable minimum
SLR requirement effective January 1, 2018.
The Company believes certain capital ratios in addition to
statutory regulatory capital ratios are useful in evaluating its
capital adequacy. The Company’s tangible common equity,
as a percent of tangible assets and as a percent of risk-
weighted assets calculated under the transitional
standardized approach, was 7.6 percent and 9.2 percent,
respectively, at December 31, 2015, compared with
7.5 percent and 9.3 percent, respectively, at December 31,
2014. The Company’s common equity tier 1 to risk-weighted
assets ratio using the Basel III standardized approach as if
fully implemented was 9.1 percent at December 31, 2015,
compared with 9.0 percent at December 31, 2014. The
Company’s common equity tier 1 to risk-weighted assets
ratio using the Basel III advanced approaches as if fully
implemented was 11.9 percent at December 31, 2015,
compared with 11.8 percent at December 31, 2014. Refer to
“Non-GAAP Financial Measures” for further information
regarding the calculation of these ratios.
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