8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 22, 2014

U.S. BANCORP

(Exact name of registrant as specified in its charter)

1-6880

(Commission File Number)


DELAWARE		41-0255900
(State or other jurisdiction		(I.R.S. Employer Identification
of incorporation)		Number)

800 Nicollet Mall

Minneapolis, Minnesota 55402

(Address of principal executive offices and zip code)

(651) 466-3000

(Registrant’s telephone number, including area code)

(not applicable)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 Under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On October 22, 2014 , U.S. Bancorp (the “Company”) issued a press release reporting quarter ended September 30, 2014 results, and posted on its website its 3Q14 Earnings Conference Call Presentation, which contains certain additional historical and forward-looking information relating to the Company. The press release is included as Exhibit 99.1 hereto and is incorporated herein by reference. The information included in the press release is considered to be “filed” under the Securities Exchange Act of 1934. The 3Q14 Earnings Conference Call Presentation is included as Exhibit 99.2 hereto and is incorporated herein by reference. The information included in the 3Q14 Earnings Conference Call Presentation is considered to be “furnished” under the Securities Exchange Act of 1934. The press release and 3Q14 Earnings Conference Call Presentation contain forward-looking statements regarding the Company and each includes a cautionary statement identifying important factors that could cause actual results to differ materially from those anticipated.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

99.1

Press Release issued by U.S. Bancorp on October 22, 2014 , deemed “filed” under the Securities Exchange Act of 1934.

99.2

3Q14 Earnings Conference Call Presentation, deemed “furnished” under the Securities Exchange Act of 1934.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

U.S. BANCORP

By /s/ Craig E. Gifford

Craig E. Gifford

Executive Vice President and
Controller

DATE: October 22, 2014

EX-99.1

Exhibit 99.1


		News Release
		Contacts:
		Dana Ripley		Sean O’Connor
		Media		Investors/Analysts
		(612) 303-3167		(612) 303-0778

U.S. BANCORP REPORTS $1.5 BILLION OF NET INCOME FOR THE THIRD QUARTER 2014

Return on Average Assets of 1.51 percent and Return on Average Common Equity of 14.5 percent

Year-over-Year Positive Operating Leverage

Returned 78 percent of Third Quarter Earnings to Shareholders

MINNEAPOLIS, October 22, 2014 — U.S. Bancorp (NYSE: USB) today reported net income of $1,471 million for the third quarter of 2014, or $.78 per diluted common share, compared with $1,468 million, or $.76 per diluted common share, in the third quarter of 2013. Highlights for the third quarter of 2014 included:

•

Growth in average total loans of 6.3 percent over the third quarter of 2013 (5.9 percent excluding the Charter One franchise acquisition in late June 2014 and 7.7 percent excluding covered loans) and 1.4 percent on a linked quarter basis (1.1 percent excluding the Charter One acquisition and 1.7 percent excluding covered loans)

•

Growth in average total commercial loans of 13.6 percent over the third quarter of 2013 and 3.1 percent over the second quarter of 2014

•

Growth in average total commercial real estate loans of 6.1 percent over the third quarter of 2013 and .8 percent over the second quarter of 2014

•

Growth in average commercial and commercial real estate commitments of 12.9 percent year-over-year and 3.2 percent over the prior quarter

•

Strong new lending activity of $56.0 billion during the third quarter, including:

•

$36.1 billion of new and renewed commercial and commercial real estate commitments

•

$2.9 billion of lines related to new credit card accounts

•

$17.0 billion of mortgage and other retail loan originations

•

Net interest income growth over the third quarter of 2013 and second quarter 2014

•

Average earning assets growth of 10.0 percent year-over-year and 3.1 percent linked quarter

•

Continued strong growth in lower cost core deposit funding on a year-over-year and linked quarter basis

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 2

•

Net interest margin of 3.16 percent for the third quarter of 2014, compared with 3.27 percent for the second quarter of 2014, and 3.43 for the third quarter of 2013

•

Decline in net charge-offs of 3.7 percent on a linked quarter basis. Provision for credit losses was $25 million less than net charge-offs

•

Allowance for credit losses to period-end loans was 1.80 percent at September 30, 2014

•

Annualized net charge-offs to average total loans ratio was .55 percent

•

Decrease in nonperforming assets on both a linked quarter and year-over-year basis

•

Nonperforming assets (excluding covered assets) declined 6.2 percent from the third quarter of 2013

•

Growth in average total deposits of 7.4 percent over the third quarter of 2013 (5.5 percent excluding the Charter One acquisition) and 3.3 percent on a linked quarter basis (1.7 percent excluding the Charter One acquisition)

•

Average low cost deposits, including noninterest-bearing and total savings deposits, grew by 12.2 percent year-over-year and 4.2 percent on a linked quarter basis

•

Industry-leading performance ratios, including:

•

Return on average assets of 1.51 percent

•

Return on average common equity of 14.5 percent

•

Efficiency ratio of 52.4 percent

•

Capital generation continued to reinforce capital position and returns. Ratios at September 30, 2014, were:

•

Basel III transitional standardized approach:

•

Common equity tier 1 capital ratio of 9.7 percent

•

Tier 1 capital ratio of 11.3 percent

•

Total risk-based capital ratio of 13.6 percent

•

Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented standardized approach of 9.0 percent and for the Basel III fully implemented advanced approaches of 11.8 percent

•

Returned 78 percent of third quarter earnings to shareholders through dividends and the buyback of 16 million common shares

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 3


EARNINGS SUMMARY			Table 1
($ in millions, except per-share data)


	3Q 2014		2Q 2014		3Q 2013		Percent Change 3Q14 vs 2Q14			Percent Change 3Q14 vs 3Q13		YTD 2014		YTD 2013		Percent Change
Net income attributable to U.S. Bancorp	$	1,471	$	1,495	$	1,468		(1.6	)		.2	$	4,363	$	4,380		(.4	)
Diluted earnings per common share	$	.78	$	.78	$	.76		—			2.6	$	2.29	$	2.25		1.8
Return on average assets (%)		1.51		1.60		1.65							1.56		1.67
Return on average common equity (%)		14.5		15.1		15.8							14.7		16.0
Net interest margin (%)		3.16		3.27		3.43							3.26		3.45
Efficiency ratio (%) (a)		52.4		53.1		52.4							52.8		51.6
Tangible efficiency ratio (%) (b)		51.3		52.1		51.3							51.8		50.5
Dividends declared per common share	$	.245	$	.245	$	.230		—			6.5	$	.720	$	.655		9.9
Book value per common share (period-end)	$	21.38	$	20.98	$	19.31		1.9			10.7

(a)	Efficiency ratio excluding notable items of 51.3% for 2Q 2014 is computed as noninterest expense of $2,753 million less FHA DOJ settlement of $200 million divided by total net revenue of $5,188 million less Visa, Inc. Class B common stock sale of $214 million.

(b)	Computed as noninterest expense divided by the sum of net interest income on a taxable-equivalent basis and noninterest income excluding net securities gains (losses) and intangible amortization.

Net income attributable to U.S. Bancorp was $1,471 million for the third quarter of 2014, .2 percent higher than the $1,468 million for the third quarter of 2013, and 1.6 percent lower than the $1,495 million for the second quarter of 2014. Diluted earnings per common share of $.78 in the third quarter of 2014 were $.02 higher than the third quarter of 2013 and equal to the previous quarter. Return on average assets and return on average common equity were 1.51 percent and 14.5 percent, respectively, for the third quarter of 2014, compared with 1.65 percent and 15.8 percent, respectively, for the third quarter of 2013. The provision for credit losses was lower than net charge-offs by $25 million in the third quarter of 2014 and in the second quarter of 2014, and $30 million lower than net charge-offs in the third quarter of 2013.

U.S. Bancorp Chairman, President and Chief Executive Officer Richard K. Davis said, “U.S. Bank delivered another solid performance in the third quarter with $1.5 billion of net income, or $.78 per diluted common share. Our ability to provide customers and clients with a diverse array of banking products and services while addressing their distinct financial objectives, in any economic environment, allows us to continue generating an industry-leading financial performance. Our return on average common equity, return on average assets, and efficiency ratio metrics remain among the strongest in the industry. Our consistently solid financial performance is a result of our adhering closely to the core fundamentals of

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 4

controlling expenses, managing capital prudently, selectively investing in initiatives that generate steady long-term growth, and expanding existing customer relationships. That was certainly the case in the third quarter as our disciplined approach returned positive operating leverage and the diversification of our business profile allowed us to maintain our momentum as the economy slowly rebounds.

“Value creation for our customers and shareholders is our highest priority. One way we create value for our customers is by preserving and leveraging our industry-leading financial strength to help them more efficiently reach their financial goals and objectives. For example, our average deposits grew 7.4 percent over the prior year to $271 billion. In a challenging macro-economic environment, retail and institutional customers gravitate toward the strength and security of U.S. Bank. Likewise, we returned 78 percent of third quarter earnings to shareholders through dividends and share buybacks. Both examples demonstrate our commitment to value creation. The better we are at addressing and meeting our customers’ financial goals and objectives, the stronger our financial performance will be.

“As we head into the final quarter of the year, we remain diligently focused on executing our plan, even with the ongoing economic headwinds, with an emphasis on providing our customers with the trusted products and services to help them build more secure financial futures, backed by the financial strength of U.S. Bank.”


INCOME STATEMENT HIGHLIGHTS			Table 2
(Taxable-equivalent basis, $ in millions, except per-share data)


	3Q 2014			2Q 2014			3Q 2013		Percent Change 3Q14 vs 2Q14			Percent Change 3Q14 vs 3Q13			YTD 2014			YTD 2013		Percent Change
Net interest income	$	2,748		$	2,744		$	2,714		.1			1.3		$	8,198		$	8,095		1.3
Noninterest income		2,242			2,444			2,177		(8.3	)		3.0			6,794			6,618		2.7

Total net revenue		4,990			5,188			4,891		(3.8	)		2.0			14,992			14,713		1.9
Noninterest expense		2,614			2,753			2,565		(5.0	)		1.9			7,911			7,592		4.2

Income before provision and taxes		2,376			2,435			2,326		(2.4	)		2.1			7,081			7,121		(.6	)
Provision for credit losses		311			324			298		(4.0	)		4.4			941			1,063		(11.5	)

Income before taxes		2,065			2,111			2,028		(2.2	)		1.8			6,140			6,058		1.4
Taxable-equivalent adjustment		56			55			56		1.8			—			167			168		(.6	)
Applicable income taxes		523			547			542		(4.4	)		(3.5	)		1,566			1,629		(3.9	)

Net income		1,486			1,509			1,430		(1.5	)		3.9			4,407			4,261		3.4
Net (income) loss attributable to noncontrolling interests		(15	)		(14	)		38		(7.1	)		nm			(44	)		119		nm

Net income attributable to U.S. Bancorp	$	1,471		$	1,495		$	1,468		(1.6	)		.2		$	4,363		$	4,380		(.4	)

Net income applicable to U.S. Bancorp common shareholders	$	1,405		$	1,427		$	1,400		(1.5	)		.4		$	4,163		$	4,163		—

Diluted earnings per common share	$	.78		$	.78		$	.76		—			2.6		$	2.29		$	2.25		1.8

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 5

Net income attributable to U.S. Bancorp for the third quarter of 2014 was $3 million (.2 percent) higher than the third quarter of 2013, and $24 million (1.6 percent) lower than the second quarter of 2014. The increase in net income year-over-year was principally due to an increase in total net revenue, driven by increases in both net interest income and fee-based revenue. The decrease in net income on a linked quarter basis was principally due to increased noninterest expense driven by merger integration, mortgage servicing- related expenses, and seasonal tax-advantaged projects costs, partially offset by a decrease in the provision for credit losses. The second quarter of 2014 included two previously disclosed notable items impacting other noninterest income and other noninterest expense that, together, had no impact to diluted earnings per common share.

Total net revenue on a taxable-equivalent basis for the third quarter of 2014 was $4,990 million which was $99 million (2.0 percent) higher than the third quarter of 2013, reflecting a 3.0 percent increase in noninterest income and a 1.3 percent increase in net interest income. Noninterest income increased year-over-year due to higher revenue in most fee businesses, partially offset by lower mortgage banking revenue. The increase in net interest income year-over-year was the result of an increase in average earning assets and continued growth in lower cost core deposit funding, offset by lower loan fees. Total net revenue on a taxable-equivalent basis was $198 million (3.8 percent) lower on a linked quarter basis due to an 8.3 percent decrease in noninterest income as a result of the sale of Visa, Inc. Class B common stock in the second quarter of 2014 and lower mortgage banking revenue, partially offset by a $4 million increase in net interest income, the result of an increase in average earning assets and growth in lower cost deposits, offset by lower loan fees.

Total noninterest expense in the third quarter of 2014 was $2,614 million which was $49 million (1.9 percent) higher than the third quarter of 2013 and $139 million (5.0 percent) lower than the second quarter of 2014. The increase in total noninterest expense year-over-year was primarily due to an increase in compensation expense, reflecting the impact of merit increases, acquisitions, and higher staffing for risk and compliance activities. The decrease in total noninterest expense on a linked quarter basis was due to the second quarter settlement with the U.S. Department of Justice to resolve an investigation relating to the endorsement of mortgage loans under the Federal Housing Administration’s insurance program (“FHA DOJ settlement”), partially offset by Charter One merger integration costs and higher mortgage servicing-related costs.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 6

The Company’s provision for credit losses for the third quarter of 2014 was $311 million, $13 million (4.0 percent) lower than the prior quarter and $13 million (4.4 percent) higher than the third quarter of 2013. The provision for credit losses was lower than net charge-offs by $25 million in the third quarter of 2014 and in the second quarter of 2014, and $30 million lower than net charge-offs in the third quarter of 2013. Net charge-offs in the third quarter of 2014 were $336 million, compared with $349 million in the second quarter of 2014, and $328 million in the third quarter of 2013. Given current economic conditions, the Company expects the level of net charge-offs to remain relatively stable in the fourth quarter of 2014.

Nonperforming assets include assets originated or acquired by the Company, as well as loans and other real estate acquired under FDIC loss sharing agreements that substantially reduce the risk of credit losses to the Company (“covered assets”). Excluding covered assets, nonperforming assets were $1,763 million at September 30, 2014, compared with $1,766 million at June 30, 2014, and $1,880 million at September 30, 2013. The decrease in nonperforming assets, excluding covered assets, compared with a year ago was driven primarily by reductions in the commercial mortgage portfolio, as well as by improvement in construction and development and credit card loans. Covered nonperforming assets were $160 million at September 30, 2014, compared with $177 million at June 30, 2014, and $332 million at September 30, 2013. The loss sharing agreement for the majority of the nonperforming covered assets expires in the fourth quarter of 2014. The ratio of the allowance for credit losses to period-end loans was 1.80 percent at September 30, 2014, compared with 1.82 percent at June 30, 2014, and 1.98 percent at September 30, 2013. The Company expects total nonperforming assets to remain relatively stable in the fourth quarter of 2014.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 7

NET INTEREST INCOME

Table 3

(Taxable-equivalent basis; $ in millions)


	3Q 2014			2Q 2014			3Q 2013			Change 3Q14 vs 2Q14			Change 3Q14 vs 3Q13			YTD 2014			YTD 2013			Change
Components of net interest income
Income on earning assets	$	3,114		$	3,104		$	3,125		$	10		$	(11	)	$	9,296		$	9,388		$	(92	)
Expense on interest-bearing liabilities		366			360			411			6			(45	)		1,098			1,293			(195	)

Net interest income	$	2,748		$	2,744		$	2,714		$	4		$	34		$	8,198		$	8,095		$	103

Average yields and rates paid
Earning assets yield		3.58	%		3.70	%		3.95	%		(.12	)%		(.37	)%		3.69	%		4.00	%		(.31	)%
Rate paid on interest-bearing liabilities		.57			.58			.71			(.01	)		(.14	)		.60			.75			(.15	)

Gross interest margin		3.01	%		3.12	%		3.24	%		(.11	)%		(.23	)%		3.09	%		3.25	%		(.16	)%

Net interest margin		3.16	%		3.27	%		3.43	%		(.11	)%		(.27	)%		3.26	%		3.45	%		(.19	)%

Average balances
Investment securities (a)	$	93,141		$	87,583		$	74,988		$	5,558		$	18,153		$	87,687		$	74,303		$	13,384
Loans		243,867			240,480			229,362			3,387			14,505			240,098			225,682			14,416
Earning assets		346,422			335,992			315,060			10,430			31,362			336,287			313,663			22,624
Interest-bearing liabilities		254,501			246,886			230,825			7,615			23,676			246,614			230,805			15,809

(a)	Excludes unrealized gain (loss)

Net Interest Income

Net interest income on a taxable-equivalent basis in the third quarter of 2014 was $2,748 million, an increase of $34 million (1.3 percent) from the third quarter of 2013. The increase was the result of growth in average earning assets and growth in lower cost core deposit funding, partially offset by lower rates on new loans and securities and lower loan fees. Average earning assets were $31.4 billion (10.0 percent) higher than the third quarter of 2013, driven by increases of $14.5 billion (6.3 percent) in average total loans and $18.2 billion (24.2 percent) in average investment securities, partially offset by a decrease of $1.4 billion (28.5 percent) in average loans held for sale. Net interest income increased $4 million on a linked quarter basis, due to higher average earning assets, partially offset by lower loan fees and lower loan and investment securities rates. The net interest margin in the third quarter of 2014 was 3.16 percent, compared with 3.43 percent in the third quarter of 2013, and 3.27 percent in the second quarter of 2014. The decline in the net interest margin on a year-over-year basis primarily reflected lower reinvestment rates on investment securities, as well as growth in the investment portfolio at lower average rates, lower loan fees due to the previously communicated wind down of the short-term, small-dollar deposit advance product, Checking

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 8

Account Advance (“CAA”), and lower rates on new loans, partially offset by lower funding costs. On a linked quarter basis, the reduction in net interest margin was principally due to growth in lower rate investment securities and lower loan fees due to the CAA product wind down.

AVERAGE LOANS

Table 4

($ in millions)


	3Q 2014		2Q 2014		3Q 2013		Percent Change 3Q14 vs 2Q14			Percent Change 3Q14 vs 3Q13			YTD 2014		YTD 2013		Percent Change
Commercial	$	72,190	$	69,920	$	62,856		3.2			14.8		$	69,276	$	61,439		12.8
Lease financing		5,155		5,100		5,208		1.1			(1.0	)		5,148		5,280		(2.5	)

Total commercial		77,345		75,020		68,064		3.1			13.6			74,424		66,719		11.5
Commercial mortgages		31,965		32,001		31,546		(.1	)		1.3			32,005		31,311		2.2
Construction and development		8,874		8,496		6,955		4.4			27.6			8,460		6,561		28.9

Total commercial real estate		40,839		40,497		38,501		.8			6.1			40,465		37,872		6.8
Residential mortgages		51,994		51,815		49,139		.3			5.8			51,799		47,055		10.1
Credit card		17,753		17,384		16,931		2.1			4.9			17,516		16,627		5.3
Retail leasing		5,991		6,014		5,664		(.4	)		5.8			5,995		5,589		7.3
Home equity and second mortgages		15,704		15,327		15,648		2.5			.4			15,467		16,021		(3.5	)
Other		27,003		26,587		25,682		1.6			5.1			26,636		25,424		4.8

Total other retail		48,698		47,928		46,994		1.6			3.6			48,098		47,034		2.3

Total loans, excluding covered loans		236,629		232,644		219,629		1.7			7.7			232,302		215,307		7.9

Covered loans		7,238		7,836		9,733		(7.6	)		(25.6	)		7,796		10,375		(24.9	)

Total loans	$	243,867	$	240,480	$	229,362		1.4			6.3		$	240,098	$	225,682		6.4

Average total loans were $14.5 billion (6.3 percent) higher in the third quarter of 2014 than the third quarter of 2013, driven by growth in total commercial loans (13.6 percent), total commercial real estate (6.1 percent), residential mortgages (5.8 percent), credit card (4.9 percent), and total other retail loans (3.6 percent). These increases were partially offset by a decline in covered loans (25.6 percent). Average total loans, excluding covered loans, were higher by 7.7 percent year-over-year. Average total loans were $3.4 billion (1.4 percent) higher in the third quarter of 2014 than the second quarter of 2014, driven by growth in total commercial loans (3.1 percent), credit card (2.1 percent), total other retail loans (1.6 percent), total commercial real estate (.8 percent), and residential mortgages (.3 percent). These increases were partially offset by a decline in covered loans (7.6 percent). Average total loans, excluding covered loans, were higher by 1.7 percent on a linked quarter basis.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 9

Average investment securities in the third quarter of 2014 were $18.2 billion (24.2 percent) higher year-over-year and $5.6 billion (6.3 percent) higher than the prior quarter. The increases were primarily due to purchases of U.S. government agency-backed securities, net of prepayments and maturities, in anticipation of final liquidity coverage ratio regulatory requirements.


AVERAGE DEPOSITS			Table 5
($ in millions)


							Percent			Percent
							Change			Change
	3Q		2Q		3Q		3Q14 vs			3Q14 vs			YTD		YTD		Percent
	2014		2014		2013		2Q14			3Q13			2014		2013		Change
Noninterest-bearing deposits	$	74,126	$	71,837	$	68,264		3.2			8.6		$	72,274	$	67,183		7.6
Interest-bearing savings deposits
Interest checking		54,454		52,989		48,235		2.8			12.9			52,928		48,347		9.5
Money market savings		66,250		61,370		55,982		8.0			18.3			62,314		54,826		13.7
Savings accounts		34,615		33,991		32,083		1.8			7.9			33,940		31,809		6.7

Total of savings deposits		155,319		148,350		136,300		4.7			14.0			149,182		134,982		10.5
Time deposits less than $100,000		11,045		10,971		12,495		.7			(11.6	)		11,151		13,082		(14.8	)
Time deposits greater than $100,000		30,518		31,193		35,309		(2.2	)		(13.6	)		31,055		33,037		(6.0	)

Total interest-bearing deposits		196,882		190,514		184,104		3.3			6.9			191,388		181,101		5.7

Total deposits	$	271,008	$	262,351	$	252,368		3.3			7.4		$	263,662	$	248,284		6.2

Average total deposits for the third quarter of 2014 were $18.6 billion (7.4 percent) higher than the third quarter of 2013. Average noninterest-bearing deposits increased $5.9 billion (8.6 percent) year-over-year, mainly in Consumer and Small Business Banking, including the $.4 billion impact of the Charter One acquisition, corporate trust, and commercial banking balances. Average total savings deposits were $19.0 billion (14.0 percent) higher year-over-year, the result of growth in Consumer and Small Business Banking, including the $3.4 billion impact of the Charter One acquisition, corporate trust, broker-dealer, and government banking related balances. Time deposits less than $100,000 were $1.5 billion (11.6 percent) lower due to maturities, while time deposits greater than $100,000 decreased $4.8 billion (13.6 percent), primarily due to a decline in broker-dealer and Consumer and Small Business Banking balances. Time deposits greater than $100,000 are managed as an alternative to other funding sources, such as wholesale borrowing, based largely on relative pricing.

Average total deposits increased $8.7 billion (3.3 percent) over the second quarter of 2014. Average noninterest-bearing deposits increased $2.3 billion (3.2 percent) on a linked quarter basis, due to higher balances in Consumer and Small Business Banking, including the impact of the Charter One acquisition, and Wholesale Banking and Commercial Real Estate, partially offset by lower corporate trust balances. Average

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 10

total savings deposits increased $7.0 billion (4.7 percent), reflecting increases in Consumer and Small Business Banking, including the impact of the Charter One acquisition, corporate trust, and broker-dealer balances, partially offset by a decrease in government banking related balances. Compared with the second quarter of 2014, average time deposits less than $100,000 increased $74 million (.7 percent) due to an increase in Consumer and Small Business Banking driven by the impact of the Charter One acquisition. Average time deposits greater than $100,000 decreased $675 million (2.2 percent) on a linked quarter basis, principally due to declines in Wholesale Banking and Commercial Real Estate and corporate trust balances.


NONINTEREST INCOME		Table 6
($ in millions)


									Percent			Percent
									Change			Change
	3Q			2Q		3Q			3Q14 vs			3Q14 vs			YTD		YTD		Percent
	2014			2014		2013			2Q14			3Q13			2014		2013		Change
Credit and debit card revenue	$	251		$	259	$	244			(3.1	)		2.9		$	749	$	702		6.7
Corporate payment products revenue		195			182		192			7.1			1.6			550		540		1.9
Merchant processing services		387			384		371			.8			4.3			1,127		1,091		3.3
ATM processing services		81			82		83			(1.2	)		(2.4	)		241		248		(2.8	)
Trust and investment management fees		315			311		280			1.3			12.5			930		842		10.5
Deposit service charges		185			171		180			8.2			2.8			513		493		4.1
Treasury management fees		136			140		134			(2.9	)		1.5			409		408		.2
Commercial products revenue		209			221		207			(5.4	)		1.0			635		616		3.1
Mortgage banking revenue		260			278		328			(6.5	)		(20.7	)		774		1,125		(31.2	)
Investment products fees		49			47		46			4.3			6.5			142		133		6.8
Securities gains (losses), net		(3	)		—		(3	)		nm			—			2		8		(75.0	)
Other		177			369		115			(52.0	)		53.9			722		412		75.2

Total noninterest income	$	2,242		$	2,444	$	2,177			(8.3	)		3.0		$	6,794	$	6,618		2.7

Noninterest Income

Third quarter noninterest income was $2,242 million which was $65 million (3.0 percent) higher than the third quarter of 2013 and $202 million (8.3 percent) lower than the second quarter of 2014. The year-over-year increase in noninterest income was due to increases in a majority of fee revenue categories, partially offset by a $68 million (20.7 percent) reduction in mortgage banking revenue, principally due to a $59 million unfavorable change in the valuation of mortgage servicing rights (“MSRs”), net of hedging activities, compared with the prior year. Trust and investment management fees increased $35 million (12.5 percent) year-over-year, reflecting account growth, improved market conditions and business expansion. Merchant processing services revenue was $16 million (4.3 percent) higher as a result of an increase in

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 11

product fees and higher volumes, partially offset by lower rates. Credit and debit card revenue increased $7 million (2.9 percent) over the third quarter of 2013 primarily due to higher transaction volumes. Deposit services charges were $5 million (2.8 percent) higher than a year ago due to account growth, the Charter One acquisition and pricing changes. The increase in other income was primarily due to gains on sales of other equity investments and an increase in retail leasing revenue.

Noninterest income was $202 million (8.3 percent) lower in the third quarter of 2014 than the second quarter of 2014, primarily due to the second quarter Visa, Inc. Class B common stock sale, lower mortgage banking revenue, and lower commercial products revenue. Mortgage banking revenue decreased $18 million (6.5 percent), principally due to a $44 million unfavorable change in the valuation of MSRs, net of hedging activities, partially offset by an increase in origination and sales revenue. Commercial products revenue decreased $12 million (5.4 percent) due to lower wholesale transaction activity, including standby letters of credit, loan and bond underwriting fees, and syndication fees. Credit and debit card revenue decreased $8 million (3.1 percent) primarily due to higher rewards. Partially offsetting these decreases was an increase in deposit service charges of $14 million (8.2 percent), mainly due to higher transaction volumes. Additionally, corporate payment products revenue increased $13 million (7.1 percent) on a linked quarter basis, principally due to seasonally higher transaction volumes, and trust and investment management fees were $4 million (1.3 percent) higher than the prior quarter due to improved market conditions and account growth, including business expansion.


NONINTEREST EXPENSE		Table 7
($ in millions)


							Percent			Percent
							Change			Change
	3Q		2Q		3Q		3Q14 vs			3Q14 vs			YTD		YTD		Percent
	2014		2014		2013		2Q14			3Q13			2014		2013		Change
Compensation	$	1,132	$	1,125	$	1,088		.6			4.0		$	3,372	$	3,268		3.2
Employee benefits		250		257		278		(2.7	)		(10.1	)		796		865		(8.0	)
Net occupancy and equipment		249		241		240		3.3			3.8			739		709		4.2
Professional services		102		97		94		5.2			8.5			282		263		7.2
Marketing and business development		78		96		85		(18.8	)		(8.2	)		253		254		(.4	)
Technology and communications		219		214		214		2.3			2.3			644		639		.8
Postage, printing and supplies		81		80		76		1.3			6.6			242		230		5.2
Other intangibles		51		48		55		6.3			(7.3	)		148		167		(11.4	)
Other		452		595		435		(24.0	)		3.9			1,435		1,197		19.9

Total noninterest expense	$	2,614	$	2,753	$	2,565		(5.0	)		1.9		$	7,911	$	7,592		4.2

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 12

Noninterest Expense

Noninterest expense in the third quarter of 2014 totaled $2,614 million, an increase of $49 million (1.9 percent) over the third quarter of 2013, and a $139 million (5.0 percent) decrease from the second quarter of 2014. The increase in total noninterest expense year-over-year was the result of higher compensation expense, reflecting the impact of merit increases, acquisitions, and higher staffing for risk and compliance activities. Net occupancy and equipment expense increased $9 million (3.8 percent) year-over-year due to business initiatives and maintenance costs. Professional services expense increased $8 million (8.5 percent) due mainly to mortgage servicing-related project costs. The $17 million (3.9 percent) increase in other expense primarily reflected the Charter One merger integration and mortgage servicing-related expenses, partially offset by lower costs for investments in tax-advantaged projects related to a change in first quarter 2014 in accounting for affordable housing investments. Offsetting these increases was a $28 million (10.1 percent) reduction in employee benefits expense driven by lower pension costs.

Noninterest expense decreased $139 million (5.0 percent) on a linked quarter basis, primarily driven by the second quarter FHA DOJ settlement in other expense, partially offset by mortgage servicing-related expenses, the Charter One merger integration costs, and seasonally higher costs related to investments in tax-advantaged projects. Marketing and business development expense decreased $18 million (18.8 percent) due to charitable contributions in the second quarter of 2014 and the timing of marketing programs in Payment Services. Additionally, employee benefits expense decreased $7 million (2.7 percent) primarily resulting from lower payroll tax expense. Partially offsetting these decreases was a $7 million (.6 percent) increase in compensation expense reflecting the impact of merit increases, and additional employees related to the Charter One acquisition and for risk and compliance activities. Professional services expense was $5 million (5.2 percent) higher, mainly due to higher mortgage servicing-related project costs.

Provision for Income Taxes

The provision for income taxes for the third quarter of 2014 resulted in a tax rate on a taxable-equivalent basis of 28.0 percent (effective tax rate of 26.0 percent), compared with 29.5 percent (effective tax rate of 27.5 percent) in the third quarter of 2013, and 28.5 percent (effective tax rate of 26.6 percent) in the second quarter of 2014.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 13


ALLOWANCE FOR CREDIT LOSSES			Table 8
($ in millions)


	3Q 2014			% (b)		2Q 2014			% (b)			1Q 2014			% (b)			4Q 2013			% (b)			3Q 2013			% (b)
Balance, beginning of period	$	4,449				$	4,497					$	4,537					$	4,578					$	4,612
Net charge-offs
Commercial		52			.29		52			.30			34			.21			33			.21			18			.11
Lease financing		6			.46		3			.24			2			.16			3			.23			(7	)		(.53	)

Total commercial		58			.30		55			.29			36			.21			36			.21			11			.06
Commercial mortgages		1			.01		(6	)		(.08	)		(1	)		(.01	)		1			.01			2			.03
Construction and development		3			.13		2			.09			(2	)		(.10	)		(30	)		(1.58	)		(8	)		(.46	)

Total commercial real estate		4			.04		(4	)		(.04	)		(3	)		(.03	)		(29	)		(.29	)		(6	)		(.06	)
Residential mortgages		42			.32		57			.44			57			.45			49			.38			57			.46
Credit card		158			3.53		170			3.92			170			3.96			163			3.72			160			3.75
Retail leasing		—			—		1			.07			—			—			—			—			1			.07
Home equity and second mortgages		24			.61		23			.60			31			.82			37			.95			43			1.09
Other		49			.72		45			.68			45			.69			52			.79			54			.83

Total other retail		73			.59		69			.58			76			.65			89			.75			98			.83

Total net charge-offs, excluding covered loans		335			.56		347			.60			336			.60			308			.55			320			.58
Covered loans		1			.05		2			.10			5			.24			4			.18			8			.33

Total net charge-offs		336			.55		349			.58			341			.59			312			.53			328			.57
Provision for credit losses		311					324						306						277						298
Other changes (a)		(10	)				(23	)					(5	)					(6	)					(4	)

Balance, end of period	$	4,414				$	4,449					$	4,497					$	4,537					$	4,578

Components
Allowance for loan losses	$	4,065				$	4,132					$	4,189					$	4,250					$	4,258
Liability for unfunded credit commitments		349					317						308						287						320

Total allowance for credit losses	$	4,414				$	4,449					$	4,497					$	4,537					$	4,578

Gross charge-offs	$	410				$	432					$	422					$	429					$	450
Gross recoveries	$	74				$	83					$	81					$	117					$	122
Allowance for credit losses as a percentage of
Period-end loans, excluding covered loans		1.81					1.83						1.90						1.94						1.99
Nonperforming loans, excluding covered loans		291					294						293						297						294
Nonperforming assets, excluding covered assets		245					246						243						242						235
Period-end loans		1.80					1.82						1.89						1.93						1.98
Nonperforming loans		282					279						278						283						276
Nonperforming assets		230					229						225						223						207

(a)	Includes net changes in credit losses to be reimbursed by the FDIC and reductions in the allowance for covered loans where the reversal of a previously recorded allowance was offset by an associated decrease in the indemnification asset, and the impact of any loan sales.

(b)	Annualized and calculated on average loan balances

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 14

Credit Quality

The allowance for credit losses was $4,414 million at September 30, 2014, compared with $4,449 million at June 30, 2014, and $4,578 million at September 30, 2013. Nonperforming assets declined on a linked quarter and year-over-year basis as economic conditions continued to slowly improve. Total net charge-offs in the third quarter of 2014 were $336 million, compared with $349 million in the second quarter of 2014, and $328 million in the third quarter of 2013. The $13 million (3.7 percent) decrease in net charge-offs on a linked quarter basis was due to improvements in the residential mortgage and credit card portfolios, while the $8 million (2.4 percent) increase in net charge-offs on a year-over-year basis reflected higher commercial loan charge-offs and lower recoveries in commercial real estate, partially offset by improvements in residential mortgages and home equity and second mortgages. The Company recorded $311 million of provision for credit losses in the current quarter, which was $25 million less than net charge-offs.

Commercial and commercial real estate loan net charge-offs were $62 million (.21 percent of average loans outstanding) in the third quarter of 2014, compared with $51 million (.18 percent of average loans outstanding) in the second quarter of 2014, and $5 million (.02 percent of average loans outstanding) in the third quarter of 2013.

Residential mortgage loan net charge-offs were $42 million (.32 percent of average loans outstanding) in the third quarter of 2014, compared with $57 million (.44 percent of average loans outstanding) in the second quarter of 2014, and $57 million (.46 percent of average loans outstanding) in the third quarter of 2013. Credit card loan net charge-offs were $158 million (3.53 percent of average loans outstanding) in the third quarter of 2014, compared with $170 million (3.92 percent of average loans outstanding) in the second quarter of 2014, and $160 million (3.75 percent of average loans outstanding) in the third quarter of 2013. Total other retail loan net charge-offs were $73 million (.59 percent of average loans outstanding) in the third quarter of 2014, compared with $69 million (.58 percent of average loans outstanding) in the second quarter of 2014, and $98 million (.83 percent of average loans outstanding) in the third quarter of 2013.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 15

The ratio of the allowance for credit losses to period-end loans was 1.80 percent (1.81 percent excluding covered loans) at September 30, 2014, compared with 1.82 percent (1.83 percent excluding covered loans) at June 30, 2014, and 1.98 percent (1.99 percent excluding covered loans) at September 30, 2013. The ratio of the allowance for credit losses to nonperforming loans was 282 percent (291 percent excluding covered loans) at September 30, 2014, compared with 279 percent (294 percent excluding covered loans) at June 30, 2014, and 276 percent (294 percent excluding covered loans) at September 30, 2013.


DELINQUENT LOAN RATIOS AS A PERCENT OF ENDING LOAN BALANCES			Table 9
(Percent)


	Sep 30		Jun 30		Mar 31		Dec 31		Sep 30
	2014		2014		2014		2013		2013
Delinquent loan ratios—90 days or more past due excluding nonperforming loans
Commercial		.05		.06		.06		.08		.07
Commercial real estate		.03		.06		.06		.07		.02
Residential mortgages		.41		.49		.64		.65		.53
Credit card		1.10		1.06		1.21		1.17		1.11
Other retail		.16		.15		.18		.18		.16
Total loans, excluding covered loans		.22		.25		.30		.31		.27
Covered loans		6.10		6.14		5.83		5.63		5.47
Total loans		.39		.43		.49		.51		.48
Delinquent loan ratios—90 days or more past due including nonperforming loans
Commercial		.27		.30		.32		.27		.24
Commercial real estate		.62		.62		.73		.83		.94
Residential mortgages		2.02		2.06		2.14		2.16		1.99
Credit card		1.32		1.35		1.59		1.60		1.66
Other retail		.53		.54		.58		.58		.60
Total loans, excluding covered loans		.84		.87		.95		.97		.94
Covered loans		7.34		7.73		7.46		7.13		7.13
Total loans		1.03		1.08		1.17		1.19		1.20

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 16


ASSET QUALITY			Table 10
($ in millions)


	Sep 30		Jun 30		Mar 31		Dec 31		Sep 30
	2014		2014		2014		2013		2013
Nonperforming loans
Commercial	$	161	$	174	$	174	$	122	$	104
Lease financing		12		16		14		12		12

Total commercial		173		190		188		134		116
Commercial mortgages		147		121		156		182		210
Construction and development		94		105		113		121		146

Total commercial real estate		241		226		269		303		356
Residential mortgages		841		818		777		770		732
Credit card		40		52		65		78		94
Other retail		184		191		188		191		206

Total nonperforming loans, excluding covered loans		1,479		1,477		1,487		1,476		1,504
Covered loans		88		119		132		127		156

Total nonperforming loans		1,567		1,596		1,619		1,603		1,660
Other real estate (a)		275		279		296		327		366
Covered other real estate (a)		72		58		73		97		176
Other nonperforming assets		9		10		11		10		10

Total nonperforming assets (b)	$	1,923	$	1,943	$	1,999	$	2,037	$	2,212

Total nonperforming assets, excluding covered assets	$	1,763	$	1,766	$	1,794	$	1,813	$	1,880

Accruing loans 90 days or more past due, excluding covered loans	$	532	$	581	$	695	$	713	$	591

Accruing loans 90 days or more past due	$	962	$	1,038	$	1,167	$	1,189	$	1,105

Performing restructured loans, excluding GNMA and covered loans	$	2,818	$	2,911	$	3,006	$	3,067	$	3,097

Performing restructured GNMA and covered loans	$	2,685	$	3,072	$	3,003	$	2,932	$	2,262

Nonperforming assets to loans plus ORE, excluding covered assets (%)		.74		.75		.78		.80		.85
Nonperforming assets to loans plus ORE (%)		.78		.80		.84		.86		.95

(a)	Includes equity investments in entities whose principal assets are other real estate owned.

(b)	Does not include accruing loans 90 days or more past due.

Nonperforming assets at September 30, 2014, totaled $1,923 million, compared with $1,943 million at June 30, 2014, and $2,212 million at September 30, 2013. Total nonperforming assets at September 30, 2014, included $160 million of covered assets. The ratio of nonperforming assets to loans and other real estate was .78 percent (.74 percent excluding covered assets) at September 30, 2014, compared with .80 percent (.75 percent excluding covered assets) at June 30, 2014, and .95 percent (.85 percent excluding covered assets) at September 30, 2013. Total commercial nonperforming loans were $17 million (8.9

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 17

percent) lower on a linked quarter basis and $57 million (49.1 percent) higher year-over-year. Commercial real estate nonperforming loans increased by $15 million (6.6 percent) on a linked quarter basis and decreased $115 million (32.3 percent) year-over-year. Residential mortgage nonperforming loans increased $23 million (2.8 percent) on a linked quarter basis and $109 million (14.9 percent) year-over-year. Credit card nonperforming loans were $12 million (23.1 percent) lower on a linked quarter basis and $54 million (57.4 percent) lower year-over-year. Other retail nonperforming loans decreased $7 million (3.7 percent) on a linked quarter basis and $22 million (10.7 percent) year-over-year.

Accruing loans 90 days or more past due were $962 million ($532 million excluding covered loans) at September 30, 2014, compared with $1,038 million ($581 million excluding covered loans) at June 30, 2014, and $1,105 million ($591 million excluding covered loans) at September 30, 2013.


COMMON SHARES			Table 11
(Millions)


	3Q 2014			2Q 2014			1Q 2014			4Q 2013			3Q 2013
Beginning shares outstanding		1,809			1,821			1,825			1,832			1,844
Shares issued for stock option and stock purchase plans, acquisitions and other corporate purposes		2			3			8			6			5
Shares repurchased		(16	)		(15	)		(12	)		(13	)		(17	)

Ending shares outstanding		1,795			1,809			1,821			1,825			1,832

Total U.S. Bancorp shareholders’ equity was $43.1 billion at September 30, 2014, compared with $42.7 billion at June 30, 2014, and $40.1 billion at September 30, 2013. During the third quarter, the Company returned 78 percent of third quarter earnings to shareholders, including $441 million in common stock dividends and $654 million of repurchased common stock.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 18


CAPITAL POSITION			Table 12
($ in millions)


	Sep 30 2014			Jun 30 2014			Mar 31 2014			Dec 31 2013			Sep 30 2013
Total U.S. Bancorp shareholders’ equity	$	43,141		$	42,700		$	42,054		$	41,113		$	40,132
Standardized Approach
Basel III transitional standardized approach/Basel I (a)
Common equity tier 1 capital	$	30,213		$	29,760		$	29,463		$	27,942		$	27,265
Tier 1 capital		35,377			34,924			34,627			33,386			32,707
Total risk-based capital		42,509			41,034			40,741			39,340			38,873
Common equity tier 1 capital ratio		9.7	%		9.6	%		9.7	%		9.4	%		9.3	%
Tier 1 capital ratio		11.3			11.3			11.4			11.2			11.2
Total risk-based capital ratio		13.6			13.2			13.5			13.2			13.3
Leverage ratio		9.4			9.6			9.7			9.6			9.6
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented standardized approach		9.0			8.9			9.0			8.8			8.6
Advanced Approaches
Common equity tier 1 capital to risk-weighted assets for the Basel III transitional advanced approaches		12.4			12.3
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented advanced approaches		11.8			11.7
Tangible common equity to tangible assets		7.6			7.5			7.8			7.7			7.4
Tangible common equity to risk-weighted assets		9.3			9.2			9.3			9.1			8.9

(a)	2014 amounts and ratios calculated under the Basel III transitional standardized approach; all prior periods under Basel I

Prior to 2014, the regulatory capital requirements effective for the Company followed Basel I. Beginning January 1, 2014, the regulatory capital requirements effective for the Company follow Basel III, subject to certain transition provisions from Basel I over the next four years to full implementation by January 1, 2018. In addition, beginning the second quarter of 2014, the advanced approaches portion of Basel III became effective for the Company. Under the Basel III transitional standardized approach, the common equity tier 1 capital ratio was 9.7 percent at September 30, 2014, compared with 9.6 percent at June 30, 2014. The tier 1 capital ratio was 11.3 percent at September 30, 2014, and at June 30, 2014, compared with 11.2 percent at September 30, 2013. Under the Basel III transitional advanced approaches, the common equity tier 1 capital to risk-weighted assets ratio was 12.4 percent at September 30, 2014, compared with 12.3 percent at June 30, 2014. All regulatory ratios continue to be in excess of “well-capitalized” requirements. In addition, the common equity tier 1 capital to risk-weighted assets ratio estimated for the

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 19

Basel III standardized approach as if fully implemented was 9.0 percent at September 30, 2014, compared with 8.9 percent at June 30, 2014, and 8.6 percent at September 30, 2013, and the common equity tier 1 capital to risk-weighted assets ratio estimated for the Basel III advanced approaches as if fully implemented was 11.8 percent at September 30, 2014, compared with 11.7 percent at June 30, 2014. The tangible common equity to tangible assets ratio was 7.6 percent at September 30, 2014, compared with 7.5 percent at June 30, 2014, and 7.4 percent at September 30, 2013.


LINE OF BUSINESS FINANCIAL PERFORMANCE (a)			Table 13
($ in millions)


	Net Income Attributable to U.S. Bancorp						Percent Change						Net Income Attributable to U.S. Bancorp
Business Line	3Q 2014		2Q 2014		3Q 2013		3Q14 vs 2Q14			3Q14 vs 3Q13			YTD 2014		YTD 2013		Percent Change			3Q 2014 Earnings Composition
Wholesale Banking and Commercial Real Estate	$	267	$	279	$	324		(4.3	)		(17.6	)	$	827	$	959		(13.8	)		18	%
Consumer and Small Business Banking		307		316		373		(2.8	)		(17.7	)		907		1,110		(18.3	)		21
Wealth Management and Securities Services		63		57		36		10.5			75.0			173		121		43.0			4
Payment Services		298		279		266		6.8			12.0			809		743		8.9			20
Treasury and Corporate Support		536		564		469		(5.0	)		14.3			1,647		1,447		13.8			37

Consolidated Company	$	1,471	$	1,495	$	1,468		(1.6	)		.2		$	4,363	$	4,380		(.4	)		100	%

(a)	preliminary data

Lines of Business

The Company’s major lines of business are Wholesale Banking and Commercial Real Estate, Consumer and Small Business Banking, Wealth Management and Securities Services, Payment Services, and Treasury and Corporate Support. These operating segments are components of the Company about which financial information is prepared and is evaluated regularly by management in deciding how to allocate resources and assess performance. Noninterest expenses incurred by centrally managed operations or business lines that directly support another business line’s operations are charged to the applicable business line based on its utilization of those services, primarily measured by the volume of customer activities, number of employees or other relevant factors. These allocated expenses are reported as net shared services expense within noninterest expense. Designations, assignments and allocations change from time to time as management systems are enhanced, methods of evaluating performance or product lines change or business segments are

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 20

realigned to better respond to the Company’s diverse customer base. During 2014, certain organization and methodology changes were made and, accordingly, prior period results were restated and presented on a comparable basis.

Wholesale Banking and Commercial Real Estate offers lending, equipment finance and small-ticket leasing, depository services, treasury management, capital markets, international trade services and other financial services to middle market, large corporate, commercial real estate, financial institution, non-profit and public sector clients. Wholesale Banking and Commercial Real Estate contributed $267 million of the Company’s net income in the third quarter of 2014, compared with $324 million in the third quarter of 2013 and $279 million in the second quarter of 2014. Wholesale Banking and Commercial Real Estate’s net income decreased $57 million (17.6 percent) from the same quarter of 2013 due to a higher provision for credit losses and a decrease in total net revenue. Total net revenue declined by $18 million (2.3 percent), due to an 11.3 percent decrease in total noninterest income, partially offset by a 2.4 percent increase in net interest income. Net interest income increased $12 million (2.4 percent) year-over-year, primarily due to an increase in average total loans and deposits, partially offset by lower rates and fees on loans. Total noninterest income decreased by $30 million (11.3 percent), driven by lower wholesale transaction activity and loan-related fees, partially offset by increases in commercial leasing revenue and equity and bond underwriting fees. Total noninterest expense was relatively flat compared with a year ago, as an increase in the FDIC insurance assessment allocation based on the level of commitments, was offset by lower professional services expense and net shared services expense. The provision for credit losses was $70 million higher year-over-year due to an increase in net charge-offs and an unfavorable change in the reserve allocation.

Wholesale Banking and Commercial Real Estate’s contribution to net income in the third quarter of 2014 was $12 million (4.3 percent) lower than the second quarter of 2014, due to a decrease in total net revenue and an increase in the provision for credit losses, partially offset by a decrease in total noninterest expense. Total net revenue decreased by $17 million (2.2 percent) compared with the prior quarter. Total noninterest income decreased by $22 million (8.5 percent), driven by lower wholesale transaction activity, in part due to seasonally higher transaction volumes in the prior quarter, and lower equity investment revenue. Net interest income increased by $5 million (1.0 percent) on a linked quarter basis, primarily due to higher average loans and an additional day in the current quarter relative to the prior quarter, partially offset by lower loan rates. Total noninterest expense decreased by $13 million (4.1 percent) due to lower

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

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compensation and employee benefits expense and seasonally lower net shared services expense. The provision for credit losses increased by $14 million (93.3 percent) due to higher net charge-offs.

Consumer and Small Business Banking delivers products and services through banking offices, telephone servicing and sales, on-line services, direct mail, ATM processing and mobile devices, such as mobile phones and tablet computers. It encompasses community banking, metropolitan banking, in-store banking, small business banking, consumer lending, mortgage banking, workplace banking, student banking and 24-hour banking. Consumer and Small Business Banking contributed $307 million of the Company’s net income in the third quarter of 2014, a $66 million (17.7 percent) decrease from the third quarter of 2013 and a $9 million (2.8 percent) decrease from the prior quarter. Within Consumer and Small Business Banking, the retail banking division reported a 22.0 percent decrease in its contribution from the same quarter of last year, principally due to lower total net revenue and an increase in total noninterest expense. Retail banking’s total net revenue was 3.6 percent lower than the third quarter of 2013. Net interest income decreased 7.2 percent, primarily as a result of lower fees due to the wind down of the CAA product, lower rates on loans, and the impact of lower rates on the margin benefit from deposits, partially offset by higher average loan and deposit balances. Total noninterest income for the retail banking division increased 5.3 percent over a year ago, principally due to an increase in retail lease revenue and deposit service charges. Total noninterest expense for the retail banking division in the third quarter of 2014 increased 5.2 percent over the same quarter of the prior year, primarily due to merger integration and higher compensation and employee benefits expense, partially offset by lower FDIC insurance assessments. The provision for credit losses for the retail banking division decreased 19.1 percent on a year-over-year basis, due to lower net charge-offs, partially offset by an unfavorable change in the reserve allocation. The contribution of the mortgage banking division was lower by 11.6 percent than the third quarter of 2013, reflecting a decrease in total net revenue, partially offset by a reduction in the provision for credit losses. The division’s 15.7 percent decrease in total net revenue was due to a 21.3 percent decrease in total noninterest income, principally due to an unfavorable change in the valuation of MSRs, net of hedging activities, as well as a 4.8 percent decrease in net interest income, primarily the result of lower average loans held for sale. Total noninterest expense was 6.6 percent higher than the prior year, primarily due to mortgage servicing-related expenses, partially offset by lower incentive compensation. The $62 million favorable change in the provision for credit losses for the mortgage banking division was due to lower net charge-offs and a favorable change in the reserve allocation.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 22

Consumer and Small Business Banking’s contribution in the third quarter of 2014 was $9 million (2.8 percent) lower than the second quarter of 2014, primarily due to an increase in total noninterest expense. Within Consumer and Small Business Banking, the retail banking division’s contribution decreased 6.6 percent, mainly due to an increase in total noninterest expense, partially offset by a decrease in the provision for credit losses. Total net revenue for the retail banking division decreased .9 percent compared with the previous quarter. Net interest income was 2.0 percent lower, primarily due to lower loan fees due to the wind down of the CAA product, partially offset by higher average loan and deposit balances and one additional day in the current quarter relative to the prior quarter. Total noninterest income was 1.7 percent higher on a linked quarter basis, driven by higher deposit service charges. Total noninterest expense increased 3.4 percent on a linked quarter basis due to merger integration expense. The provision for credit losses decreased 22.5 percent on a linked quarter basis due to lower net charge-offs and a favorable change in the reserve allocation in the current quarter. The contribution of the mortgage banking division increased 2.2 percent over the second quarter of 2014 primarily due to a lower provision for credit losses, partially offset by higher total noninterest expense. Total net revenue was relatively flat due to an 11.3 percent increase in net interest income, due to higher average loans held for sale, higher average loan balances, and an additional day in the quarter, offset by a 6.6 percent decrease in total noninterest income, due to an unfavorable change in the valuation of MSRs, net of hedging activities. Total noninterest expense increased 3.9 percent, primarily reflecting higher mortgage servicing-related expenses and higher compensation and employee benefits expense. The provision for credit losses for the mortgage banking division decreased $14 million on a linked quarter basis due to a decrease in net charge-offs and a favorable change in the reserve allocation.

Wealth Management and Securities Services provides private banking, financial advisory services, investment management, retail brokerage services, insurance, trust, custody and fund servicing through five businesses: Wealth Management, Corporate Trust Services, U.S. Bancorp Asset Management, Institutional Trust & Custody and Fund Services. Wealth Management and Securities Services contributed $63 million of the Company’s net income in the third quarter of 2014, compared with $36 million in the third quarter of 2013 and $57 million in the second quarter of 2014. The business line’s contribution was $27 million (75.0 percent) higher than the same quarter of 2013, as an increase in total net revenue was partially offset by higher total noninterest expense. Total net revenue increased by $52 million (13.1 percent) year-over-year, driven by a $38 million (12.1 percent) increase in total noninterest income, reflecting the impact of account growth, improved market conditions, and business expansion. In addition, net interest income increased by

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 23

$14 million (17.1 percent), principally due to higher average loan and deposit balances and an increase in the margin benefit of corporate trust deposits. Total noninterest expense increased by $10 million (3.0 percent) primarily as a result of higher compensation and employee benefits expense, including the impact of business expansion, partially offset by lower net shared services expense. The provision for credit losses remained flat compared to the prior year quarter, as lower net charge-offs were offset by an unfavorable change in the reserve allocation.

The business line’s contribution in the third quarter of 2014 was $6 million (10.5 percent) higher than the prior quarter. Total net revenue increased on a linked quarter basis, reflecting an increase in net interest income (5.5 percent), principally due to higher average deposit balances and the impact of higher rates on the margin benefit from corporate trust deposits. In addition, an increase in total noninterest income (1.4 percent) was due to higher trust and investment management fees, resulting from improved market conditions and account growth, including business expansion. Total noninterest expense was relatively flat compared with the prior quarter, as higher compensation and professional services expenses were offset by lower employee benefits expense. The provision for credit losses remained flat on a linked quarter basis, as lower net charge-offs were offset by an unfavorable change in the reserve allocation.

Payment Services includes consumer and business credit cards, stored-value cards, debit cards, corporate and purchasing card services, consumer lines of credit and merchant processing. Payment Services contributed $298 million of the Company’s net income in the third quarter of 2014, compared with $266 million in the third quarter of 2013 and $279 million in the second quarter of 2014. The $32 million (12.0 percent) increase in the business line’s contribution from the prior year was due to an increase in total net revenue, partially offset by an increase in total noninterest expense and a higher provision for credit losses. Total net revenue increased by $69 million (5.7 percent) year-over-year. Net interest income increased by $49 million (12.5 percent), primarily due to higher average loan balances and fees and improved loan rates. Total noninterest income was $20 million (2.4 percent) higher year-over-year, due to higher merchant processing services revenue due to increased product fees and transaction volumes, partially offset by lower rates, and an increase in credit and debit card revenue on higher transaction volumes. Total noninterest expense increased by $3 million (.5 percent) over the third quarter of 2013, primarily due to higher compensation and employee benefits expense, including the impact of business initiatives, partially offset by reductions in technology and communications expense and other intangibles expense. The provision for credit losses increased by $18 million (10.5 percent) due to an unfavorable change in the reserve allocation, partially offset by lower net charge-offs.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 24

Payment Services’ contribution in the third quarter of 2014 increased $19 million (6.8 percent) over the second quarter of 2014. Total net revenue increased $37 million (3.0 percent) on a linked quarter basis driven by higher net interest income and higher total noninterest income. Net interest income increased by $27 million (6.5 percent) over the second quarter mainly due to improved loan rates. Total noninterest income increased by $10 million (1.2 percent), primarily reflecting an increase in corporate payment products revenue on seasonally higher volumes, partially offset by a reduction in credit and debit card revenue due to higher rewards expense. Total noninterest expense was flat on a linked quarter basis as increased marketing expenses were offset by lower net shared services expense. The provision for credit losses was $8 million (4.4 percent) higher on a linked quarter basis due to an unfavorable change in the reserve allocation, partially offset by lower net charge-offs.

Treasury and Corporate Support includes the Company’s investment portfolios, most covered commercial and commercial real estate loans and related other real estate owned, funding, capital management, interest rate risk management, the net effect of transfer pricing related to average balances, income taxes not allocated to business lines, including most investments in tax-advantaged projects, and the residual aggregate of those expenses associated with corporate activities that are managed on a consolidated basis. Treasury and Corporate Support recorded net income of $536 million in the third quarter of 2014, compared with $469 million in the third quarter of 2013 and $564 million in the second quarter of 2014. Net interest income increased by $38 million (6.6 percent) over the third quarter of 2013, principally due to an increase in average balances in the investment securities portfolio and lower rates on short-term borrowings, partially offset by lower income from the run-off of acquired assets. Total noninterest income increased by $85 million over the third quarter of last year, mainly due to gains on sales of equity investments and higher commercial products revenue. Total noninterest expense decreased by $26 million (13.1 percent), principally due to a decrease in employee benefits expense resulting from lower pension costs and lower costs for investments in tax-advantaged projects related to a change in accounting for affordable housing investments in the first quarter of 2014, partially offset by increased compensation expense. The provision for credit losses was $9 million higher year-over-year, due to an unfavorable change in the reserve allocation and higher net charge-offs.

Net income in the third quarter of 2014 was $28 million (5.0 percent) lower on a linked quarter basis, driven by lower total net revenue, partially offset by lower total noninterest expense. Total net revenue was $214 million (21.9 percent) lower than the prior quarter, driven by a second quarter sale of Visa, Inc. Class B common stock. A $167 million (49.1 percent) decrease in total noninterest expense was primarily due to the

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 25

FHA DOJ settlement and charitable contributions in the second quarter, partially offset by Charter One merger integration costs and seasonally higher costs related to investments in tax-advantaged projects. The provision for credit losses was $6 million higher compared with the second quarter of 2014 due to higher net charge-offs and an unfavorable change in the reserve allocation.

Additional schedules containing more detailed information about the Company’s business line results are available on the web at usbank.com or by calling Investor Relations at 612-303-4328.

On Wednesday, October 22, 2014, at 8:00 a.m. (CDT) Richard K. Davis, chairman, president and chief executive officer, and Andrew Cecere, vice chairman and chief financial officer, will host a conference call to review the financial results. The conference call will be available by telephone or on the Internet. A presentation will be used during the call and will be available on the Company’s website at www.usbank.com. To access the conference call from locations within the United States and Canada, please dial 866-316-1409. Participants calling from outside the United States and Canada, please dial 706-634-9086. The conference ID number for all participants is 97474478. For those unable to participate during the live call, a recording of the call will be available approximately two hours after the conference call ends on Wednesday, October 22nd, and will run through Wednesday, October 29th, at 11:00 p.m. (CDT). To access the recorded message within the United States and Canada, dial 855-859-2056. If calling from outside the United States and Canada, please dial 404-537-3406 to access the recording. The conference ID is 97474478. To access the webcast and presentation go to www.usbank.com and click on “About U.S. Bank.” The “Webcasts & Presentations” link can be found under the Investor/Shareholder information heading, which is at the left side of the bottom of the page.

Minneapolis-based U.S. Bancorp (“USB”), with $391 billion in assets as of September 30, 2014, is the parent company of U.S. Bank National Association, the 5th largest commercial bank in the United States. The Company operates 3,177 banking offices in 25 states and 5,026 ATMs and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services products to consumers, businesses and institutions. Visit U.S. Bancorp on the web at usbank.com.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 26

Forward-Looking Statements

The following information appears in accordance with the Private Securities Litigation Reform Act of 1995:

This press release contains forward-looking statements about U.S. Bancorp. Statements that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements and are based on the information available to, and assumptions and estimates made by, management as of the date hereof. These forward-looking statements cover, among other things, anticipated future revenue and expenses and the future plans and prospects of U.S. Bancorp. Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. A reversal or slowing of the current moderate economic recovery or another severe contraction could adversely affect U.S. Bancorp’s revenues and the values of its assets and liabilities. Global financial markets could experience a recurrence of significant turbulence, which could reduce the availability of funding to certain financial institutions and lead to a tightening of credit, a reduction of business activity, and increased market volatility. Continued stress in the commercial real estate markets, as well as a delay or failure of recovery in the residential real estate markets could cause additional credit losses and deterioration in asset values. In addition, U.S. Bancorp’s business and financial performance is likely to be negatively impacted by recently enacted and future legislation and regulation. U.S. Bancorp’s results could also be adversely affected by deterioration in general business and economic conditions; changes in interest rates; deterioration in the credit quality of its loan portfolios or in the value of the collateral securing those loans; deterioration in the value of securities held in its investment securities portfolio; legal and regulatory developments; increased competition from both banks and non-banks; changes in customer behavior and preferences; breaches in data security; effects of mergers and acquisitions and related integration; effects of critical accounting policies and judgments; and management’s ability to effectively manage credit risk, residual value risk, market risk, operational risk, compliance risk, strategic risk, interest rate risk, liquidity risk and reputational risk.

For discussion of these and other risks that may cause actual results to differ from expectations, refer to U.S. Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2013, on file with the Securities and Exchange Commission, including the sections entitled “Risk Factors” and “Corporate Risk Profile” contained in Exhibit 13, and all subsequent filings with the Securities and Exchange Commission under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934. However, factors other than these also could adversely affect U.S. Bancorp’s results, and the reader should not consider these factors to be a complete set of all potential risks or uncertainties. Forward-looking statements speak only as of the date hereof, and U.S. Bancorp undertakes no obligation to update them in light of new information or future events.

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U.S. Bancorp Reports Third Quarter 2014 Results

October 22, 2014

Page 27

Non-GAAP Financial Measures

In addition to capital ratios defined by banking regulators, the Company considers various other measures when evaluating capital utilization and adequacy, including:

•

Tangible common equity to tangible assets,

•

Tangible common equity to risk-weighted assets,

•

Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented standardized approach,

•

Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented advanced approaches, and for additional information,

•

Tier 1 common equity to risk-weighted assets using Basel I definition.

These measures are viewed by management as useful additional methods of reflecting the level of capital available to withstand unexpected market or economic conditions. Additionally, presentation of these measures allows investors, analysts and banking regulators to assess the Company’s capital position relative to other financial services companies. These measures differ from currently effective capital ratios defined by banking regulations principally in that the numerator includes unrealized gains and losses related to available-for-sale securities and excludes preferred securities, including preferred stock, the nature and extent of which varies among different financial services companies. These measures are not defined in generally accepted accounting principles (“GAAP”), or are not currently effective or defined in federal banking regulations. As a result, these measures disclosed by the Company may be considered non-GAAP financial measures.

There may be limits in the usefulness of these measures to investors. As a result, the Company encourages readers to consider the consolidated financial statements and other financial information contained in this press release in their entirety, and not to rely on any single financial measure. A table follows that shows the Company’s calculation of these non-GAAP financial measures.

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U.S. Bancorp

Consolidated Statement of Income


	Three Months Ended						Nine Months Ended
(Dollars and Shares in Millions, Except Per Share Data)	September 30,						September 30,
(Unaudited)	2014			2013			2014			2013
Interest Income
Loans	$	2,518		$	2,568		$	7,572		$	7,682
Loans held for sale		36			46			87			172
Investment securities		476			420			1,378			1,222
Other interest income		27			34			89			141

Total interest income		3,057			3,068			9,126			9,217
Interest Expense
Deposits		115			134			348			433
Short-term borrowings		72			98			204			270
Long-term debt		178			178			543			587

Total interest expense		365			410			1,095			1,290

Net interest income		2,692			2,658			8,031			7,927
Provision for credit losses		311			298			941			1,063

Net interest income after provision for credit losses		2,381			2,360			7,090			6,864
Noninterest Income
Credit and debit card revenue		251			244			749			702
Corporate payment products revenue		195			192			550			540
Merchant processing services		387			371			1,127			1,091
ATM processing services		81			83			241			248
Trust and investment management fees		315			280			930			842
Deposit service charges		185			180			513			493
Treasury management fees		136			134			409			408
Commercial products revenue		209			207			635			616
Mortgage banking revenue		260			328			774			1,125
Investment products fees		49			46			142			133
Securities gains (losses), net		(3	)		(3	)		2			8
Other		177			115			722			412

Total noninterest income		2,242			2,177			6,794			6,618
Noninterest Expense
Compensation		1,132			1,088			3,372			3,268
Employee benefits		250			278			796			865
Net occupancy and equipment		249			240			739			709
Professional services		102			94			282			263
Marketing and business development		78			85			253			254
Technology and communications		219			214			644			639
Postage, printing and supplies		81			76			242			230
Other intangibles		51			55			148			167
Other		452			435			1,435			1,197

Total noninterest expense		2,614			2,565			7,911			7,592

Income before income taxes		2,009			1,972			5,973			5,890
Applicable income taxes		523			542			1,566			1,629

Net income		1,486			1,430			4,407			4,261
Net (income) loss attributable to noncontrolling interests		(15	)		38			(44	)		119

Net income attributable to U.S. Bancorp	$	1,471		$	1,468		$	4,363		$	4,380

Net income applicable to U.S. Bancorp common shareholders	$	1,405		$	1,400		$	4,163		$	4,163

Earnings per common share	$	.78		$	.76		$	2.30		$	2.26
Diluted earnings per common share	$	.78		$	.76		$	2.29		$	2.25
Dividends declared per common share	$	.245		$	.230		$	.720		$	.655
Average common shares outstanding		1,798			1,832			1,809			1,844
Average diluted common shares outstanding		1,807			1,843			1,819			1,854

Page 28

U.S. Bancorp

Consolidated Ending Balance Sheet


	September 30,			December 31,			September 30,
(Dollars in Millions)	2014			2013			2013
	(Unaudited)						(Unaudited)
Assets
Cash and due from banks	$	6,183		$	8,477		$	11,615
Investment securities
Held-to-maturity		44,231			38,920			36,904
Available-for-sale		52,674			40,935			39,307
Loans held for sale		3,939			3,268			3,858
Loans
Commercial		78,878			70,033			68,958
Commercial real estate		40,909			39,885			38,678
Residential mortgages		51,957			51,156			50,170
Credit card		17,858			18,021			17,063
Other retail		48,935			47,678			47,114

Total loans, excluding covered loans		238,537			226,773			221,983
Covered loans		7,054			8,462			9,396

Total loans		245,591			235,235			231,379
Less allowance for loan losses		(4,065	)		(4,250	)		(4,258	)

Net loans		241,526			230,985			227,121
Premises and equipment		2,608			2,606			2,608
Goodwill		9,401			9,205			9,173
Other intangible assets		3,338			3,529			3,455
Other assets		27,384			26,096			26,640

Total assets	$	391,284		$	364,021		$	360,681

Liabilities and Shareholders’ Equity
Deposits
Noninterest-bearing	$	78,641		$	76,941		$	72,333
Interest-bearing		165,070			156,165			152,861
Time deposits greater than $100,000		29,386			29,017			36,522

Total deposits		273,097			262,123			261,716
Short-term borrowings		30,045			27,608			26,128
Long-term debt		30,768			20,049			18,750
Other liabilities		13,545			12,434			12,535

Total liabilities		347,455			322,214			319,129
Shareholders’ equity
Preferred stock		4,756			4,756			4,756
Common stock		21			21			21
Capital surplus		8,293			8,216			8,188
Retained earnings		41,543			38,667			37,692
Less treasury stock		(10,836	)		(9,476	)		(9,174	)
Accumulated other comprehensive income (loss)		(636	)		(1,071	)		(1,351	)

Total U.S. Bancorp shareholders’ equity		43,141			41,113			40,132
Noncontrolling interests		688			694			1,420

Total equity		43,829			41,807			41,552

Total liabilities and equity	$	391,284		$	364,021		$	360,681

Page 29

U.S. Bancorp

Non-GAAP Financial Measures


	September 30,			June 30,			March 31,			December 31,			September 30,
(Dollars in Millions, Unaudited)	2014			2014			2014			2013			2013
Total equity	$	43,829		$	43,386		$	42,743		$	41,807		$	41,552
Preferred stock		(4,756	)		(4,756	)		(4,756	)		(4,756	)		(4,756	)
Noncontrolling interests		(688	)		(686	)		(689	)		(694	)		(1,420	)
Goodwill (net of deferred tax liability) (1)		(8,503	)		(8,548	)		(8,352	)		(8,343	)		(8,319	)
Intangible assets, other than mortgage servicing rights		(877	)		(925	)		(804	)		(849	)		(878	)

Tangible common equity (a)		29,005			28,471			28,142			27,165			26,179
Tangible common equity (as calculated above)		29,005			28,471			28,142			27,165			26,179
Adjustments (2)		187			224			239			224			258

Common equity tier 1 capital estimated for the Basel III fully implemented standardized and advanced approaches (b)		29,192			28,695			28,381			27,389			26,437
Tier 1 capital, determined in accordance with prescribed regulatory requirements using Basel I definition											33,386			32,707
Preferred stock											(4,756	)		(4,756	)
Noncontrolling interests, less preferred stock not eligible for Tier 1 capital											(688	)		(686	)

Tier 1 common equity using Basel I definition (c)											27,942			27,265
Total assets		391,284			389,065			371,289			364,021			360,681
Goodwill (net of deferred tax liability) (1)		(8,503	)		(8,548	)		(8,352	)		(8,343	)		(8,319	)
Intangible assets, other than mortgage servicing rights		(877	)		(925	)		(804	)		(849	)		(878	)

Tangible assets (d)		381,904			379,592			362,133			354,829			351,484
Risk-weighted assets, determined in accordance with prescribed regulatory requirements (3) (e)		311,914	*		309,929			302,841			297,919			293,155
Adjustments (4)		12,837	*		12,753			13,238			13,712			13,473

Risk-weighted assets estimated for the Basel III fully implemented standardized approach (f)		324,751	*		322,682			316,079			311,631			306,628
Risk-weighted assets, determined in accordance with prescribed transitional advanced approaches regulatory requirements		243,905	*		241,929
Adjustments (5)		3,443	*		3,383

Risk-weighted assets estimated for the Basel III fully implemented advanced approaches (g)		247,348	*		245,312
Ratios *
Tangible common equity to tangible assets (a)/(d)		7.6	%		7.5	%		7.8	%		7.7	%		7.4	%
Tangible common equity to risk-weighted assets (a)/(e)		9.3			9.2			9.3			9.1			8.9
Tier 1 common equity to risk-weighted assets using Basel I definition (c)/(e)		—			—			—			9.4			9.3
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented standardized approach (b)/(f)		9.0			8.9			9.0			8.8			8.6
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented advanced approaches (b)/(g)		11.8			11.7

*	Preliminary data. Subject to change prior to filings with applicable regulatory agencies.

(1)	Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements beginning March 31, 2014.

(2)	Includes net losses on cash flow hedges included in accumulated other comprehensive income and other adjustments.

(3)	Beginning March 31, 2014, calculated under the Basel III transitional standardized approach; all other periods calculated under Basel I.

(4)	Includes higher risk-weighting for unfunded loan commitments, investment securities, residential mortgages, mortgage servicing rights and other adjustments.

(5)	Primarily reflects higher risk-weighting for mortgage servicing rights.

Page 30

EX-99.2

Richard K. Davis

Chairman, President and CEO

Andy Cecere

Vice Chairman and CFO

U.S. Bancorp

3Q14 Earnings

Conference Call

U.S. Bancorp

3Q14 Earnings

Conference Call

October 22, 2014

Exhibit 99.2

Forward-looking Statements and Additional Information

The

following

information

appears

accordance

with

the

Private

Securities

Litigation

Reform

Act

1995:

This

presentation

contains

forward-looking

statements

about

U.S.

Bancorp.

Statements

that

are

not

historical

current

facts,

including

statements

about

beliefs

and

expectations,

are

forward-looking

statements

and

are

based

the

information

available

to,

and

assumptions

and

estimates

made

by,

management

the

date

made.

These

forward-looking

statements

cover,

among

other

things,

anticipated

future

revenue

and

expenses

and

the

future

plans

and

prospects

U.S.

Bancorp.

Forward-looking

statements

involve

inherent

risks

and

uncertainties,

and

important

factors

could

cause

actual

results

differ

materially

from

those

anticipated.

reversal

slowing

the

current

moderate

economic

recovery

another

severe

contraction

could

adversely

affect

U.S.

Bancorp’s

revenues

and

the

values

its

assets

and

liabilities.

Global

financial

markets

could

experience

recurrence

significant

turbulence,

which

could

reduce

the

availability

funding

certain

financial

institutions

and

lead

tightening

credit,

reduction

business

activity,

and

increased

market

volatility.

Continued

stress

the

commercial

real

estate

markets,

well

delay

failure

recovery

the

residential

real

estate

markets,

could

cause

additional

credit

losses

and

deterioration

asset

values.

addition,

U.S.

Bancorp’s

business

and

financial

performance

likely

negatively

impacted

recently

enacted

and

future

legislation

and

regulation.

U.S.

Bancorp’s

results

could

also

adversely

affected

deterioration

general

business

and

economic

conditions;

changes

interest

rates;

deterioration

the

credit

quality

its

loan

portfolios

the

value

the

collateral

securing

those

loans;

deterioration

the

value

securities

held

its

investment

securities

portfolio;

legal

and

regulatory

developments;

increased

competition

from

both

banks

and

non-banks;

changes

customer

behavior

and

preferences;

breaches

data

security;

effects

mergers

and

acquisitions

and

integration;

effects

critical

accounting

policies

and

judgments;

and

management’s

ability

effectively

manage

credit

risk,

residual

value

risk,

market

risk,

operational

risk,

interest

rate

risk

and

liquidity

risk.

For

discussion

these

and

other

risks

that

may

cause

actual

results

differ

from

expectations,

refer

U.S.

Bancorp’s

Annual

Report

Form

10-K

for

the

year

ended

December

31,

2013,

file

with

the

Securities

and

Exchange

Commission,

including

the

sections

entitled

“Risk

Factors”

and

“Corporate

Risk

Profile”

contained

Exhibit

13,

and

all

subsequent

filings

with

the

Securities

and

Exchange

Commission

under

Sections

13(a),

13(c),

15(d)

the

Securities

Exchange

Act

1934.

Forward-looking

statements

speak

only

the

date

they

are

made,

and

U.S.

Bancorp

undertakes

obligation

update

them

light

new

information

future

events.

This

presentation

includes

non-GAAP

financial

measures

describe

U.S.

Bancorp’s

performance.

The

calculations

these

measures

are

provided

within

the

appendix

the

presentation.

These

disclosures

should

not

viewed

substitute

for

operating

results

determined

accordance

with

GAAP,

nor

are

they

necessarily

comparable

non-GAAP

performance

measures

that

may

presented

other

companies.

3Q14 Earnings

Conference Call

3Q14 Highlights

Net income of $1.5 billion; $0.78 per diluted common share

Positive operating leverage on a year-over-year basis

Average loan growth of 6.3% vs. 3Q13 (5.9% excluding Charter One

acquisition)

and 1.4% vs. 2Q14 (1.1% excluding Charter One acquisition)

Average deposit growth of 7.4% vs. 3Q13 (5.5% excluding Charter One

acquisition) and 3.3% vs. 2Q14 (1.7% excluding Charter One acquisition)

Net charge-offs declined 3.7% vs. 2Q14

Nonperforming assets decreased 6.2% vs. 3Q13 (excluding covered assets)

Capital generation continues to reinforce capital position

•

Common equity tier 1 capital ratio of 9.0% estimated for the Basel III fully implemented

standardized approach

•

Common equity tier 1 capital ratio of 9.7%; Tier 1 capital ratio

of 11.3%

Returned 78% of earnings to shareholders in 3Q14

•

Repurchased 16 million shares of common stock during the quarter

3Q14 Earnings

Conference Call

Performance Ratios

Return on Average Common Equity

and Return on Average Assets

Efficiency Ratio and

Net Interest Margin

Return on Avg Common Equity

Return on Avg Assets

Efficiency Ratio

Net Interest Margin

Excluding

$214

million

gain

Visa

Inc.

Class

common

stock

sale

and

$200

million

FHA

DOJ

settlement

Efficiency

ratio

computed

noninterest

expense

divided

the

sum

net

interest

income

taxable-equivalent

basis

and

noninterest

income

excluding

securities

gains

(losses)

net

3Q14 Earnings

Conference Call

* Gain on Visa Inc. Class B common stock sale

Taxable-equivalent basis

Revenue Growth

Year-Over-Year Change

(5.6%)

(4.4%)

(1.2%)

4.9%

2.0%

$ in millions

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Loan and Deposit Growth

Year-Over-Year Growth

Average Balances

$ in billions

3Q14 Acquisition Adjusted

Loan Growth = 5.9%

Deposit Growth = 5.5%

190.0

210.0

230.0

250.0

270.0

3Q13

4Q13

1Q14

2Q14

3Q14

6.8%

$240.5

6.3%

$243.9

5.7%

$229.4

5.7%

$232.8

6.0%

$235.9

6.0%

$262.4

7.4%

$271.0

5.5%

$252.4

5.4%

$256.9

5.1%

$257.5

Loans

Deposits

3Q14 Earnings

Conference Call

Credit Quality

* Excluding Covered Assets (assets subject to loss sharing agreements with FDIC)

Net Charge-offs

Nonperforming Assets*

$ in millions

Net Charge-offs (Left Scale)

NCOs to Avg Loans (Right Scale)

Nonperforming Assets (Left Scale)

NPAs to Loans plus ORE (Right Scale)

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Earnings Summary

$ in millions, except per-share data

Taxable-equivalent basis

YTD

3Q14

2Q14

3Q13

vs 2Q14

vs 3Q13

2014

2013

% B/(W)

Net Interest Income

2,748

2,744

2,714

0.1

1.3

8,198

8,095

1.3

Noninterest Income

2,242

2,444

2,177

(8.3)

3.0

6,794

6,618

2.7

Total Revenue

4,990

5,188

4,891

(3.8)

2.0

14,992

14,713

1.9

Noninterest Expense

2,614

2,753

2,565

5.0

(1.9)

7,911

7,592

(4.2)

Operating Income

2,376

2,435

2,326

(2.4)

2.1

7,081

7,121

(0.6)

Net Charge-offs

336

349

328

3.7

(2.4)

1,026

1,153

11.0

Excess Provision

(25)

(30)

(16.7)

(85)

(90)

(5.6)

Income before Taxes

2,065

2,111

2,028

(2.2)

1.8

6,140

6,058

1.4

Applicable Income Taxes

579

602

598

3.8

3.2

1,733

1,797

3.6

Noncontrolling Interests

(15)

(14)

(7.1)

(44)

119

Net Income

1,471

1,495

1,468

(1.6)

0.2

4,363

4,380

(0.4)

Preferred Dividends/Other

2.9

200

217

7.8

NI to Common

1,405

1,427

1,400

(1.5)

0.4

4,163

Diluted EPS

0.78

0.76

2.6

2.29

2.25

1.8

Average Diluted Shares

1,807

1,821

1,843

0.8

2.0

1,819

1,854

1.9

% B/(W)

3Q14 Earnings

Conference Call

3Q14 Results -

Key Drivers

vs. 3Q13

Net Revenue increase of 2.0%

•

Net interest income increase of 1.3%; net interest margin of 3.16% vs. 3.43% in 3Q13

•

Noninterest income increase of 3.0%

Noninterest expense increase of 1.9%

Provision for credit losses higher by $13 million

•

Net charge-offs higher by $8 million, or 2.4%

•

Provision lower than NCOs by $25 million vs. $30 million in 3Q13

vs. 2Q14

Net Revenue decrease of 3.8% (0.3% increase excluding notable items)

•

Net interest income increase of 0.1%; net interest margin of 3.16%

vs. 3.27% in 2Q14

•

Noninterest income decrease of 8.3% (0.5% increase excluding

notable items)

Noninterest expense decrease of 5.0% (2.4% increase

excluding notable items)

Provision for credit losses lower by $13 million

•

Net charge-offs decreased by $13 million, or 3.7%

•

Provision lower than NCOs by $25 million vs. $25 million in 2Q14

3Q14 Earnings

Conference Call

Capital Position

$ in billions; RWA = risk-weighted assets

(a) 2014 amounts and ratios calculated under the Basel III transitional standardized approach; all prior periods under Basel I

3Q14

2Q14

1Q14

4Q13

3Q13

Total U.S. Bancorp shareholders' equity

43.1

42.7

42.1

41.1

40.1

Standardized Approach

Basel III transitional standardized approach/Basel I (a)

Common equity tier 1 capital

30.2

29.8

29.5

27.9

27.3

Tier 1 capital

35.4

34.9

34.6

33.4

32.7

Total risk-based capital

42.5

41.0

40.7

39.3

38.9

Common equity tier 1 capital ratio

9.7%

9.6%

9.7%

9.4%

9.3%

Tier 1 capital ratio

11.3%

11.4%

11.2%

Total risk-based capital ratio

13.6%

13.2%

13.5%

13.2%

13.3%

Leverage ratio

9.4%

9.6%

9.7%

9.6%

Common equity tier 1 capital to RWA estimated for the

Basel III fully implemented standardized approach

9.0%

8.9%

9.0%

8.8%

8.6%

Advanced Approaches

Common equity tier 1 capital to RWA for the Basel III

transitional advanced approaches

12.4%

12.3%

Common equity tier 1 capital to RWA estimated for the

Basel III fully implemented advanced approaches

11.8%

11.7%

Tangible common equity ratio

7.6%

7.5%

7.8%

7.7%

7.4%

Tangible common equity as a % of RWA

9.3%

9.2%

9.3%

9.1%

8.9%

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Appendix

3Q14 Earnings

Conference Call

Average Loans

Key Points

$ in billions

vs. 3Q13

Average total loans grew by $14.5 billion, or 6.3%

(5.9% excluding Charter One acquisition)

Average total loans, excluding covered loans,

were higher by 7.7%

Average total commercial loans increased $9.3

billion, or 13.6%; average commercial real estate

loans increased $2.3 billion, or 6.1%

vs. 2Q14

Average total loans grew by $3.4 billion, or 1.4%

(1.1% excluding Charter One acquisition)

Average total loans, excluding covered loans,

were higher by 1.7%

Average total commercial loans increased $2.3

billion, or 3.1%; average commercial real estate

loans increased $0.3 billion, or 0.8%

Year-Over-Year Growth

5.7%

6.0%

6.8%

6.3%

Covered

Commercial

CRE

Res Mtg

Retail

Credit Card

$229.4

$232.8

$235.9

$240.5

$243.9

Average Loans

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Average Deposits

Key Points

$ in billions

vs. 3Q13

Average total deposits increased by $18.6

billion, or 7.4% (5.5% excluding Charter One

acquisition)

Average low-cost deposits (NIB, interest

checking, money market and savings)

increased by $24.9 billion, or 12.2%

vs. 2Q14

Average total deposits increased by $8.7

billion, or 3.3% (1.7% excluding Charter One

acquisition)

Average low-cost deposits increased by $9.2

billion, or 4.2%

Year-Over-Year Growth

5.5%

5.4%

5.1%

6.0%

7.4%

Time

Money Market

Checking and Savings

Noninterest-bearing

$252.4

$256.9

$257.5

$262.4

$271.0

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Net Interest Income

Key Points

$ in millions

Taxable-equivalent basis

vs. 3Q13

Average earning assets grew by $31.4 billion,

or 10.0%

Net interest margin lower by 27 bps (3.16%

vs. 3.43%) driven by:

•

Lower reinvestment rates on investment securities,

as well as growth in the investment portfolio at

lower average rates, lower loan fees, and lower

rates on new loans

•

Partially offset by lower funding costs

vs. 2Q14

Average earning assets grew by $10.4 billion,

or 3.1%

Net interest margin lower by 11 bps (3.16%

vs. 3.27%) driven by:

•

Growth in lower rate investment securities and

lower loan fees

Year-Over-Year Change

(2.5%)

(1.8%)

(0.1%)

2.7%

1.3%

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Noninterest Income

Key Points

$ in millions

Payments = credit and debit card revenue, corporate payment products revenue and merchant processing;

Service charges = deposit service charges, treasury management fees and ATM processing services

vs. 3Q13

Noninterest income increased by $65 million, or

3.0%, driven by:

•

Higher credit and debit card revenues (2.9% increase) due to

higher transaction volumes; higher merchant processing

revenue (4.3% increase) due to an increase in product fees and

higher volumes, partially offset by lower rates

•

Higher trust and investment management revenue (12.5%

increase) due to account growth, improved market conditions

and business expansion

•

Higher deposit service charges (2.8% increase) due to account

growth, the Charter One acquisition and pricing changes

•

Higher other income due primarily to gains on sales of other

equity investments and an increase in retail leasing revenue

•

Mortgage banking revenue decline of $68 million

vs. 2Q14

Noninterest income decreased by $202 million, or

8.3%, driven by:

•

Lower other income primarily due to the second quarter

Visa sale

•

Higher corporate payments (7.1% increase) due to seasonally

higher transaction volumes

•

Higher deposit service charges (8.2% increase) due to higher

transaction volumes

•

Lower commercial products revenue (5.4% decrease) due to

lower wholesale transaction activity

•

Mortgage banking revenue decline of $18 million

Year-Over-Year Change

(9.1%)

(7.4%)

(2.6%)

7.4%

3.0%

$2,177

$2,156

$2,108

$2,444

$2,242

All Other

Mortgage

Service Charges

Trust and Inv Mgmt

Payments

3Q13

4Q13

1Q14

2Q14

3Q14

Visa Gain

214

Total

214

Notable Noninterest Income Items

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Noninterest Expense

Key Points

$ in millions

vs. 3Q13

Noninterest expense was higher by $49 million, or

1.9%, driven by:

•

Higher compensation expense (4.0% increase) reflecting the

impact of merit increases, acquisitions, and higher staffing for

risk and compliance activities

•

Higher net occupancy and equipment expense (3.8% increase)

due to business initiatives and maintenance costs

•

Higher professional services expense (8.5% increase) due

mainly to mortgage servicing-related project costs

•

Higher other expense primarily due to Charter One merger

integration and mortgage servicing-related expenses, partially

offset by lower costs for investments in tax-advantaged projects

related to a change in 1Q14 in accounting for affordable housing

investments

•

Lower employee benefit expense (decrease of 10.1%) driven by

lower pension costs

vs. 2Q14

Noninterest expense was lower by $139 million, or

5.0%, driven by:

•

Lower other expense due to the 2Q FHA DOJ settlement,

partially offset by mortgage servicing-related expenses, the

Charter One merger integration costs, and seasonally higher

costs related to investments in tax-advantaged projects

•

Lower marketing and business development (18.8% decrease)

due to 2Q charitable contributions and the timing of various

marketing programs

•

Higher professional services expense (5.2% increase) primarily

due to higher mortgage servicing-related project costs

Year-Over-Year Change

(1.7%)

(0.1%)

3.0%

7.7%

1.9%

$2,565

$2,682

$2,544

$2,753

$2,614

All Other

Tech and Communications

Prof Svcs, Marketing and PPS

Occupancy and Equipment

Compensation and Benefits

3Q13

4Q13

1Q14

2Q14

3Q14

FHA DOJ settlement

200

Total

200

Notable Noninterest Expense Items

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Credit Quality

Commercial Loans

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Continued new client growth led to 3.2% linked quarter loan growth and 14.8% year-over-year

growth; utilization rates improved modestly

Net charge-offs below historic norms and were largely unchanged

Nonperforming loans and delinquencies continued at historically low levels

3Q13

2Q14

3Q14

Average Loans

$62,856

$69,920

$72,190

30-89 Delinquencies

0.28%

0.23%

90+ Delinquencies

0.08%

0.06%

0.05%

Nonperforming Loans

0.16%

0.24%

0.22%

$ in millions

3Q14 Earnings

Conference Call

Credit Quality

Commercial Leases

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Commercial lease balances increased slightly

Net charge-offs increased in the quarter but remain at low historic levels

Nonperforming loans and delinquencies continued at modest levels

3Q13

2Q14

3Q14

Average Loans

$5,208

$5,100

$5,155

30-89 Delinquencies

0.76%

0.75%

0.83%

90+ Delinquencies

0.00%

Nonperforming Loans

0.23%

0.31%

0.23%

$ in millions

3Q14 Earnings

Conference Call

Credit Quality

Commercial Real Estate

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Average loans increased 0.8% on a linked quarter basis and 6.1% year-over-year

Credit quality is stable at low levels; net charge-offs ratio of 0.04%

Delinquencies continued a downward trend

3Q13

2Q14

3Q14

Average Loans

$38,501

$40,497

$40,839

30-89 Delinquencies

0.16%

0.14%

0.12%

90+ Delinquencies

0.02%

0.06%

0.03%

Nonperforming Loans

0.92%

0.55%

0.59%

Performing TDRs*

$365

$330

$284

$ in millions

Investor

$20,552

Owner

Occupied

$11,413

Multi-family

$2,927

Retail

$670

Residential

Construction

$1,810

A&D

Construction

$631

Office

$897

Other

$1,939

* TDR = troubled debt restructuring

3Q14 Earnings

Conference Call

Credit Quality

Residential Mortgage

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Modest growth in high-quality originations (weighted average FICO 757, weighted average LTV

71%), as average loans increased 0.3% over 2Q14

81% of the balances have been originated since the beginning of 2009; the origination quality

metrics and performance to date have significantly outperformed prior vintages

with similar seasoning

3Q13

2Q14

3Q14

Average Loans

$49,139

$51,815

$51,994

30-89 Delinquencies

0.70%

0.48%

0.46%

90+ Delinquencies

0.53%

0.49%

0.41%

Nonperforming Loans

1.46%

1.57%

1.62%

$ in millions

** Excludes GNMA loans, whose repayments are insured by the FHA or guaranteed by the Department of VA ($2,478 million 3Q14)

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

3Q13

2Q14

3Q14

Average Loans

$16,931

$17,384

$17,753

30-89 Delinquencies

1.25%

1.13%

1.23%

90+ Delinquencies

1.11%

1.06%

1.10%

Nonperforming Loans

0.55%

0.29%

0.22%

Credit Quality -

Credit Card

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Average loans increased 2.1% on a linked quarter basis; up 4.9% year-over-year

Delinquencies and losses have stabilized near historically low levels with some seasonal impacts

on delinquencies

Nonperforming loans continued to decline

$ in millions

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Credit Quality -

Home Equity

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

High-quality

originations

(weighted

average

FICO

commitments

was

767,

weighted

average

CLTV

71%)

originated

primarily

through

the

retail

branch

network

existing

bank

customers

their

primary

residence

Net

charge-offs

ratio

declined

year-over-year

basis

3Q13

2Q14

3Q14

Average Loans

$15,648

$15,327

$15,704

30-89 Delinquencies

0.65%

0.50%

0.51%

90+ Delinquencies

0.25%

0.26%

Nonperforming Loans

1.15%

1.11%

1.05%

Subprime: 2%

Wtd Avg LTV**: 90%

NCO: 6.22%

$ in millions

Prime: 95%

Wtd Avg LTV**: 72%

NCO: 0.50%

** LTV at origination

Other: 3%

Wtd Avg LTV**: 72%

NCO: 0.79%

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Credit Quality -

Retail Leasing

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Year-over-year

growth

(5.8%)

driven

high-quality

originations

(weighted

average

FICO

780)

Delinquencies

remained

relatively

stable

very

low

levels

Strong

used

auto

values

continued

contribute

historically

low

net

charge-offs

3Q13

2Q14

3Q14

Average Loans

$5,664

$6,014

$5,991

30-89 Delinquencies

0.15%

0.16%

0.14%

90+ Delinquencies

0.02%

0.00%

0.02%

Nonperforming Loans

0.02%

$ in millions

Manheim

Used

Vehicle

Value

Index

source:

www.manheimconsulting.com,

January

1995

100,

quarter

value

average

monthly

ending

value

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Credit Quality -

Other Retail

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Auto

loan

growth

continued

offset

declines

student

lending

loan

balances

Net

charge-offs

and

delinquencies

remained

low

linked

quarter

and

year-over-year

basis

3Q13

2Q14

3Q14

Average Loans

$25,682

$26,587

$27,003

30-89 Delinquencies

0.48%

0.47%

0.49%

90+ Delinquencies

0.14%

0.11%

0.13%

Nonperforming Loans

0.10%

0.06%

Installment

$6,072

Auto Loans

$14,404

Revolving

Credit

$3,231

Student

Lending

$3,296

$ in millions

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Credit Quality -

Auto Loans

Average Loans and Net Charge-offs Ratios

Key Statistics

Comments

Continued growth in auto loans driven by high-quality originations in the Indirect Channel

(weighted average FICO 762)

Net charge-offs increased due to seasonality as well as growth initiatives beginning to mature

3Q13

2Q14

3Q14

Average Loans

$12,946

$14,108

$14,404

30-89 Delinquencies

0.30%

0.38%

0.41%

90+ Delinquencies

0.03%

0.05%

Nonperforming Loans

0.02%

0.01%

0.03%

$ in millions

Auto Loans are included in Other Retail category

Direct: 6%

Wtd Avg FICO: 748

NCO: .06%

Indirect: 94%

Wtd Avg FICO: 763

NCO: 0.26%

3Q14 Earnings

Conference Call

3Q14 Earnings

Conference Call

Mortgage Repurchase

Mortgages Repurchased and Make-whole Payments

Mortgage Representation and Warranties Reserve

$ in millions

3Q14

2Q14

1Q14

4Q13

3Q13

Beginning Reserve

$69

$75

$83

$176

$190

Net Realized Losses

(1)

(2)

(10)

(63)

(13)

Change in Reserve

(6)

(4)

(30)

(1)

Ending Reserve

$62

$69

$75

$83

$176

Mortgages

repurchased

and make-whole

payments

$19

$30

$36

$32

$42

Repurchase activity lower than

peers due to:

•

Conservative credit and

underwriting culture

•

Disciplined origination process -

primarily conforming loans

(

95%

sold

GSEs)

Do not participate in private

placement securitization market

Outstanding repurchase and

make-whole requests balance

= $29 million

3Q14 Earnings

Conference Call

Non-GAAP Financial Measures

$ in millions

3Q14

2Q14

1Q14

4Q13

3Q13

Total equity

43,829

43,386

42,743

41,807

41,552

Preferred stock

(4,756)

Noncontrolling interests

(688)

(686)

(689)

(694)

(1,420)

Goodwill (net of deferred tax liability) (1)

(8,503)

(8,548)

(8,352)

(8,343)

(8,319)

Intangible assets, other than mortgage servicing rights

(877)

(925)

(804)

(849)

(878)

Tangible common equity (a)

29,005

28,471

28,142

27,165

26,179

Tangible common equity (as calculated above)

29,005

28,471

28,142

27,165

26,179

Adjustments (2)

187

224

239

224

258

Common equity tier 1 capital estimated for the Basel III fully

implemented standardized and advanced approaches (b)

29,192

28,695

28,381

27,389

26,437

Tier 1 capital, determined in accordance with prescribed

regulatory requirements using Basel I definition

33,386

32,707

Preferred stock

(4,756)

Noncontrolling interests, less preferred stock not eligible for Tier 1 capital

(688)

(686)

Tier 1 common equity using Basel I definition (c)

27,942

27,265

(1) Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements beginning March 31, 2014.

(2) Includes net losses on cash flow hedges included in accumulated other comprehensive income and other adjustments.

(3)

Beginning March 31, 2014, calculated under the Basel III transitional standardized approach; all other periods calculated under Basel I.

(4) Includes higher risk-weighting for unfunded loan commitments, investment securities, residential mortgages, mortgage servicing rights and other adjustments.

(5)

Primarily reflects higher risk-weighting for mortgage servicing rights.

3Q14 Earnings

Conference Call

Non-GAAP Financial Measures

$ in millions

3Q14

2Q14

1Q14

4Q13

3Q13

Total assets

391,284

389,065

371,289

364,021

360,681

Goodwill (net of deferred tax liability) (1)

(8,503)

(8,548)

(8,352)

(8,343)

(8,319)

Intangible assets, other than mortgage servicing rights

(877)

(925)

(804)

(849)

(878)

Tangible assets (d)

381,904

379,592

362,133

354,829

351,484

Risk-weighted assets, determined in accordance with prescribed

regulatory requirements (3)(e)

311,914

309,929

302,841

297,919

293,155

Adjustments (4)

12,837

12,753

13,238

13,712

13,473

Risk-weighted assets estimated for the Basel III fully implemented

standardized approach (f)

324,751

322,682

316,079

311,631

306,628

Risk-weighted assets, determined in accordance with prescribed

transitional advanced approaches regulatory requirements

243,905

241,929

Adjustments (5)

3,443

3,383

Risk-weighted assets estimated for the Basel III fully implemented

247,348

245,312

advanced approaches (g)

Ratios

Tangible common equity to tangible assets (a)/(d)

7.6

7.5

7.8

7.7

7.4

Tangible common equity to risk-weighted assets (a)/(e)

9.3

9.2

9.3

9.1

8.9

Tier 1 common equity to risk-weighted assets using Basel I definition (c)/(e)

9.4

9.3

Common equity tier 1 capital to risk-weighted assets estimated for the

Basel III fully implemented standardized approach (b)/(f)

9.0

8.9

9.0

8.8

8.6

Common equity tier 1 capital to risk-weighted assets estimated for the

Basel III fully implemented advanced approaches (b)/(g)

11.8

11.7

* Preliminary data. Subject to change prior to filings with applicable regulatory agencies.

(1) Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements beginning March 31, 2014.

(2) Includes net losses on cash flow hedges included in accumulated other comprehensive income and other adjustments.

(3)

Beginning March 31, 2014, calculated under the Basel III transitional standardized approach; all other periods calculated under Basel I.

(4) Includes higher risk-weighting for unfunded loan commitments, investment securities, residential mortgages, mortgage servicing rights and other adjustments.

(5)

Primarily reflects higher risk-weighting for mortgage servicing rights.

U.S. Bancorp

3Q14 Earnings

Conference Call

U.S. Bancorp

3Q14 Earnings

Conference Call

October 22, 2014