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): January 17, 2018

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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule l2b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section l3(a) of the Exchange Act.  ☐

Item 2.02. Results of Operations and Financial Condition.

On January 17, 2018, U.S. Bancorp (the “Company”) issued a press release reporting quarter-ended December 31, 2017 results, and posted on its website its 4Q17 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 4Q17 Earnings Conference Call Presentation is included as Exhibit 99.2 hereto and is incorporated herein by reference. The information included in the 4Q17 Earnings Conference Call Presentation is considered to be “furnished” under the Securities Exchange Act of 1934.

As previously disclosed, the Company is working to resolve matters with regulatory agencies, including the Office of the Comptroller of the Currency and the Financial Crimes Enforcement Network, relating to their review of the legacy Bank Secrecy Act/anti-money laundering compliance program of U.S. Bank National Association (“U.S. Bank”). Resolution of these regulatory matters is expected to include payment of civil money penalties. Also as disclosed, a legacy banking relationship between U.S. Bank and payday lending businesses associated with former customer Scott Tucker (who was convicted of fraud charges on October 13, 2017) has been the subject of an investigation by the U.S. Attorney’s Office in Manhattan. That investigation also has covered issues related to the adequacy and effectiveness of U.S. Bank’s legacy Bank Secrecy Act/anti-money laundering compliance program. The parties are currently working on a definitive settlement, which the Company currently expects to include a deferred prosecution agreement and payment of a penalty, which the Company expects to finalize soon. Based on the current status of these various matters, the Company has accrued a liability of $608 million, which is reflected in the Company’s financial results for the quarter ended December 31, 2017. The settlement of these matters is subject to negotiation and completion of final documentation and approval by the Company and the relevant agencies, and therefore the final terms of the settlements may differ from the Company’s current expectations. In addition, as previously disclosed, the Company remains subject to other ongoing examinations, inquiries and investigations by government agencies and bank regulators, including a review by the Board of Governors of the Federal Reserve System of economic sanctions and related compliance matters, any of which could result in administrative proceedings, monetary fines or other penalties.

Cautionary Note on Forward-Looking Statements

This Report on Form 8-K contains forward-looking statements about the Company. 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. Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. For discussion of risks that may cause actual results to differ from expectations, refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, 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 the Company’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 the Company undertakes no obligation to update them in light of new information or future events.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits.

99.1 Press Release issued by U.S. Bancorp on January 17, 2018, deemed “filed” under the Securities Exchange Act of 1934.

99.2 4Q17 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: January 17, 2018

EX-99.1

Exhibit 99.1

	News Release
	Contacts:
	Dana Ripley	Jennifer Thompson
	Media	Investors/Analysts
	(612) 303-3167	(612) 303-0778

U.S. BANCORP REPORTS FOURTH QUARTER AND FULL YEAR 2017 EARNINGS

Record Earnings Per Diluted Common Share for Full Year 2017

Full year return on average assets of 1.39 percent and average common equity of 13.8 percent

Returned 77 percent of full year earnings to shareholders

MINNEAPOLIS, January 17, 2018 — U.S. Bancorp (NYSE: USB) today reported net income of $1,682 million for the fourth quarter of 2017, or $0.97 per diluted common share, compared with $1,478 million, or $0.82 per diluted common share, in the fourth quarter of 2016. The fourth quarter of 2017 included notable items related to the impacts of tax reform, a special employee bonus, a charitable contribution to the U.S. Bank Foundation, and a regulatory and legal accrual that, combined, increased diluted earnings per common share by $0.09.

Highlights for the full year of 2017 included:

• Record diluted earnings per common share of $3.51, record net revenue of $22,057 million, and record net income of $6,218 million. Earnings to common shareholders were $3.42 per diluted common share for 2017, excluding notable items.

• Industry-leading return on average assets of 1.39 percent and return on average common equity of 13.8 percent (1.35 percent and 13.4 percent, respectively, excluding notable items)

• Returned 77 percent of 2017 earnings to shareholders through dividends and share buybacks

Highlights for the fourth quarter of 2017 included:

• Record net revenue, both as reported and excluding notable items

• Diluted earnings per common share of $0.88 in the fourth quarter of 2017, excluding notable items

• Return on average assets of 1.46 percent and return on average common equity of 14.7 percent (1.33 percent and 13.4 percent, respectively, excluding notable items)

• Returned 72 percent of fourth quarter earnings to shareholders through dividends and share buybacks

• Net interest income grew 6.4 percent year-over-year and 0.3 percent on a linked quarter basis

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• Net interest margin of 3.08 percent for the fourth quarter of 2017 was 10 basis points higher than the fourth quarter of 2016 and 2 basis points lower than the third quarter of 2017

• Positive operating leverage in the fourth quarter of 2017, on a year-over-year basis, excluding notable items

• Nonperforming assets decreased 25.1 percent on a year-over-year basis and 4.1 percent on a linked quarter basis

• Average total loans grew 2.6 percent over the fourth quarter of 2016 and 0.8 percent on a linked quarter basis

• Average total commercial loans grew 4.0 percent over the fourth quarter of 2016 and 1.0 percent on a linked quarter basis

• Average total other retail loans grew 6.0 percent over the fourth quarter of 2016 and 1.9 percent on a linked quarter basis

• Strong capital position. At December 31, 2017, the estimated common equity tier 1 capital to risk-weighted assets ratio was 9.1 percent using the Basel III fully implemented standardized approach and was 11.6 percent using the Basel III fully implemented advanced approaches method.

EARNINGS SUMMARY																Table 1
($ in millions, except per-share data)							Percent		Percent
							Change		Change
	4Q		3Q		4Q		4Q17 vs		4Q17 vs		Full Year		Full Year		Percent
	2017		2017		2016		3Q17		4Q16		2017		2016		Change
Net income attributable to U.S. Bancorp	$	1,682	$	1,563	$	1,478		7.6		13.8	$	6,218	$	5,888		5.6
Diluted earnings per common share	$	.97	$	.88	$	.82		10.2		18.3	$	3.51	$	3.24		8.3
Return on average assets (%)		1.46		1.38		1.32						1.39		1.36
Return on average common equity (%)		14.7		13.6		13.1						13.8		13.4
Net interest margin (%)		3.08		3.10		2.98						3.06		3.01
Efficiency ratio (%) (a)		70.0		54.3		55.3						58.8		54.9
Tangible efficiency ratio (%) (a)		69.2		53.5		54.5						58.0		54.0
Dividends declared per common share	$	.30	$	.30	$	.28		—		7.1	$	1.16	$	1.07		8.4
Book value per common share (period end)	$	26.34	$	25.98	$	24.63		1.4		6.9

(a) See Non-GAAP Financial Measures reconciliation on page 23

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Net income attributable to U.S. Bancorp was $1,682 million for the fourth quarter of 2017, 13.8 percent higher than the $1,478 million for the fourth quarter of 2016, and 7.6 percent higher than the $1,563 million for the third quarter of 2017. Diluted earnings per common share of $0.97 in the fourth quarter of 2017 were $0.15 higher than the fourth quarter of 2016 and $0.09 higher than the third quarter of 2017. The fourth quarter of 2017 included $0.09 of notable items, including a benefit of $910 million related to the estimated impact of tax reform on the Company’s tax related assets and liabilities, partially offset by a $608 million accrual for regulatory and legal matters, and $152 million, net of tax, for a charitable contribution to the U.S. Bank Foundation and a special bonus to certain eligible employees. The regulatory and legal accrual is related to previously disclosed matters related to Bank Secrecy Act/anti-money laundering compliance program adequacy and investigations by the United States Attorney’s Office in Manhattan into that program and U.S. Bank National Association’s legacy banking relationship with payday lending businesses associated with a former customer. The increase in net income year-over-year was primarily due to total net revenue growth, including an increase in net interest income of 6.4 percent, mainly a result of the impact of rising interest rates and loan growth. Noninterest income increased 0.4 percent principally due to higher payment services revenue, trust and investment management fees and deposit service charges, mostly offset by a decrease in mortgage banking revenue and lower equity investment income. Excluding the notable items, the increase in total net revenue was partially offset by higher noninterest expense, primarily due to increased compensation expense related to hiring to support business growth and compliance programs, merit increases, variable compensation related to revenue growth and higher employee benefits expense, partially offset by lower professional services expense driven by lower consulting costs for risk and compliance programs. Excluding notable items, net income decreased slightly on a linked quarter basis principally due to a seasonal increase in noninterest expense of 2.5 percent driven by seasonally higher costs related to investments in tax-advantaged projects in addition to higher employee benefits and professional services expense. These increases were partially offset by an increase in total net revenue of 0.5 percent, reflecting an increase in net interest income of 0.3 percent primarily driven by loan growth, and an increase in noninterest income of 0.8 percent related to higher trust and investment management fees and payment services revenue.

U.S. Bancorp President and Chief Executive Officer Andy Cecere said, “Our fourth quarter results were a strong end to what was a record year for U.S. Bancorp on several measures: we delivered record net revenue, net income, and diluted earnings per common share. Excluding notable items, our fourth quarter performance metrics were highlighted by a return on average common equity of 13.4 percent and a return on

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average assets of 1.33 percent. In the fourth quarter we returned 72 percent of earnings to shareholders through dividends and share buybacks.

“The economic backdrop is favorable, and tax reform legislation enacted late last year has provided us an opportunity to accelerate investment in our businesses, our people, and our communities, while at the same time enhancing shareholder value through the potential for increased payouts. We previously announced that we will raise our minimum wage in the United States to $15 per hour, provide one-time bonuses to certain eligible employees, and contribute an additional $150 million to the U.S. Bank Foundation, which will help revitalize our communities for years to come. With the ongoing benefit provided by a lower corporate tax rate we plan to increase our investments in technology and innovation, with a focus on enhancing the customer experience and improving operational efficiency that drives long-term growth and creates value for shareholders.

“The successes of 2017 were a direct result of the outstanding dedication and effort of our employees. I want to thank our amazing team members who work tirelessly to be our customers’ most trusted partner. We are operating from a position of strength as we enter 2018 and we will continue to work every day to create value for our investors, our customers, our communities, and our employees.”

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INCOME STATEMENT HIGHLIGHTS																							Table 2
($ in millions, except per-share data)										Percent			Percent
										Change			Change
	4Q			3Q			4Q			4Q17 vs			4Q17 vs			Full Year			Full Year			Percent
	2017			2017			2016			3Q17			4Q16			2017			2016			Change
Net interest income	$	3,144		$	3,135		$	2,955			.3			6.4		$	12,241		$	11,528			6.2
Taxable-equivalent adjustment		53			51			49			3.9			8.2			205			203			1.0
Net interest income (taxable-equivalent basis)		3,197			3,186			3,004			.3			6.4			12,446			11,731			6.1
Noninterest income		2,441			2,422			2,431			.8			.4			9,611			9,577			.4
Total net revenue		5,638			5,608			5,435			.5			3.7			22,057			21,308			3.5
Noninterest expense		3,939			3,039			3,004			29.6			31.1			12,945			11,676			10.9
Income before provision and income taxes		1,699			2,569			2,431			(33.9	)		(30.1	)		9,112			9,632			(5.4	)
Provision for credit losses		335			360			342			(6.9	)		(2.0	)		1,390			1,324			5.0
Income before taxes		1,364			2,209			2,089			(38.3	)		(34.7	)		7,722			8,308			(7.1	)
Income taxes and taxable-equivalent adjustment		(322	)		640			598			nm			nm			1,469			2,364			(37.9	)
Net income		1,686			1,569			1,491			7.5			13.1			6,253			5,944			5.2
Net (income) loss attributable to noncontrolling interests		(4	)		(6	)		(13	)		33.3			69.2			(35	)		(56	)		37.5
Net income attributable to U.S. Bancorp	$	1,682		$	1,563		$	1,478			7.6			13.8		$	6,218		$	5,888			5.6
Net income applicable to U.S. Bancorp common shareholders	$	1,611		$	1,485		$	1,391			8.5			15.8		$	5,913		$	5,589			5.8
Diluted earnings per common share	$	.97		$	.88		$	.82			10.2			18.3		$	3.51		$	3.24			8.3

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NET INTEREST INCOME																							Table 3
(Taxable-equivalent basis; $ in millions)
										Change			Change
	4Q			3Q			4Q			4Q17 vs			4Q17 vs			Full Year			Full Year
	2017			2017			2016			3Q17			4Q16			2017			2016			Change
Components of net interest income
Income on earning assets	$	3,795		$	3,768		$	3,424		$	27		$	371		$	14,598		$	13,375		$	1,223
Expense on interest-bearing liabilities		598			582			420			16			178			2,152			1,644			508
Net interest income	$	3,197		$	3,186		$	3,004		$	11		$	193		$	12,446		$	11,731		$	715
Average yields and rates paid
Earning assets yield		3.65	%		3.67	%		3.40	%		(.02	)%		.25	%		3.59	%		3.43	%		.16	%
Rate paid on interest-bearing liabilities		.77			.76			.57			.01			.20			.71			.57			.14
Gross interest margin		2.88	%		2.91	%		2.83	%		(.03	)%		.05	%		2.88	%		2.86	%		.02	%
Net interest margin		3.08	%		3.10	%		2.98	%		(.02	)%		.10	%		3.06	%		3.01	%		.05	%
Average balances
Investment securities (a)	$	113,287		$	111,832		$	110,386		$	1,455		$	2,901		$	111,820		$	107,922		$	3,898
Loans		279,751			277,626			272,671			2,125			7,080			276,537			267,811			8,726
Earning assets		413,510			408,825			401,971			4,685			11,539			406,421			389,877			16,544
Interest-bearing liabilities		308,976			304,236			295,288			4,740			13,688			302,204			287,760			14,444

(a) Excludes unrealized gain (loss)

Net Interest Income

Net interest income on a taxable-equivalent basis in the fourth quarter of 2017 was $3,197 million, an increase of $193 million (6.4 percent) over the fourth quarter of 2016. The increase was principally driven by the impact of rising interest rates and loan growth. Average earning assets were $11.5 billion (2.9 percent) higher than the fourth quarter of 2016, reflecting increases of $7.1 billion (2.6 percent) in average total loans, $2.9 billion (2.6 percent) in average investment securities and $2.7 billion (19.4 percent) in average other earning assets. Net interest income on a taxable-equivalent basis increased $11 million (0.3 percent) on a linked quarter basis primarily driven by loan growth and higher interest rates. Average earning assets were $4.7 billion (1.1 percent) higher on a linked quarter basis, reflecting increases of $2.1 billion (0.8 percent) in average total loans, $1.5 billion (1.3 percent) in average investment securities and $1.1 billion (7.3 percent) in average other earning assets.

The net interest margin in the fourth quarter of 2017 was 3.08 percent, compared with 2.98 percent in the fourth quarter of 2016, and 3.10 percent in the third quarter of 2017. The increase in the net interest

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margin year-over-year was primarily due to higher interest rates and loan mix, partially offset by higher funding costs and higher cash balances. The decrease in net interest margin on a linked quarter basis was primarily due to higher interest recoveries in the third quarter of 2017.

Investment Securities

Average investment securities in the fourth quarter of 2017 were $2.9 billion (2.6 percent) higher year-over-year and $1.5 billion (1.3 percent) higher than the prior quarter. These increases were primarily due to purchases of U.S. Treasury and U.S. government mortgage-backed securities, net of prepayments and maturities, in support of liquidity management.

AVERAGE LOANS																		Table 4
($ in millions)							Percent			Percent
							Change			Change
	4Q		3Q		4Q		4Q17 vs			4Q17 vs			Full Year		Full Year		Percent
	2017		2017		2016		3Q17			4Q16			2017		2016		Change
Commercial	$	92,101	$	91,077	$	88,448		1.1			4.1		$	90,393	$	86,754		4.2
Lease financing		5,457		5,556		5,359		(1.8	)		1.8			5,511		5,289		4.2
Total commercial		97,558		96,633		93,807		1.0			4.0			95,904		92,043		4.2
Commercial mortgages		29,543		30,114		31,767		(1.9	)		(7.0	)		30,430		31,860		(4.5	)
Construction and development		11,466		11,507		11,624		(.4	)		(1.4	)		11,647		11,180		4.2
Total commercial real estate		41,009		41,621		43,391		(1.5	)		(5.5	)		42,077		43,040		(2.2	)
Residential mortgages		59,639		59,030		56,718		1.0			5.2			58,784		55,682		5.6
Credit card		21,218		20,926		20,942		1.4			1.3			20,906		20,490		2.0
Retail leasing		7,982		7,762		6,191		2.8			28.9			7,354		5,619		30.9
Home equity and second mortgages		16,299		16,299		16,444		—			(.9	)		16,278		16,419		(.9	)
Other		32,856		32,008		31,245		2.6			5.2			31,784		30,292		4.9
Total other retail		57,137		56,069		53,880		1.9			6.0			55,416		52,330		5.9
Total loans, excluding covered loans		276,561		274,279		268,738		.8			2.9			273,087		263,585		3.6
Covered loans		3,190		3,347		3,933		(4.7	)		(18.9	)		3,450		4,226		(18.4	)
Total loans	$	279,751	$	277,626	$	272,671		.8			2.6		$	276,537	$	267,811		3.3

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Loans

Average total loans were $7.1 billion (2.6 percent) higher than the fourth quarter of 2016. The increase was due to growth in total commercial loans (4.0 percent), residential mortgages (5.2 percent), retail leasing (28.9 percent) and other retail loans (5.2 percent). These increases were partially offset by a decrease in total commercial real estate loans (5.5 percent) due to disciplined underwriting of construction and development loans and payoffs of commercial mortgages given recent capital market financing by customers. Loan growth was also muted by run-off in the covered loans portfolio (18.9 percent). Average total loans were $2.1 billion (0.8 percent) higher than the third quarter of 2017. This increase was primarily driven by linked quarter growth in total other retail loans (1.9 percent), total commercial loans (1.0 percent) and residential mortgages (1.0 percent), partially offset by decreases in total commercial real estate loans (1.5 percent) and covered loans (4.7 percent).

AVERAGE DEPOSITS																	Table 5
($ in millions)							Percent		Percent
							Change		Change
	4Q		3Q		4Q		4Q17 vs		4Q17 vs			Full Year		Full Year		Percent
	2017		2017		2016		3Q17		4Q16			2017		2016		Change
Noninterest-bearing deposits	$	82,303	$	81,964	$	84,892		.4		(3.0	)	$	81,933	$	81,176		.9
Interest-bearing savings deposits
Interest checking		70,717		68,066		64,647		3.9		9.4			67,953		61,726		10.1
Money market savings		105,348		105,072		106,637		.3		(1.2	)		106,476		96,518		10.3
Savings accounts		43,772		43,649		41,310		.3		6.0			43,393		40,382		7.5
Total savings deposits		219,837		216,787		212,594		1.4		3.4			217,822		198,626		9.7
Time deposits		37,022		36,400		31,697		1.7		16.8			33,759		33,008		2.3
Total interest-bearing deposits		256,859		253,187		244,291		1.5		5.1			251,581		231,634		8.6
Total deposits	$	339,162	$	335,151	$	329,183		1.2		3.0		$	333,514	$	312,810		6.6

Deposits

Average total deposits for the fourth quarter of 2017 were $10.0 billion (3.0 percent) higher than the fourth quarter of 2016. Average noninterest-bearing deposits decreased $2.6 billion (3.0 percent) year-over-year primarily due to a decrease in Corporate and Commercial Banking. Average total savings deposits were $7.2 billion (3.4 percent) higher year-over-year driven by growth in Consumer and Business Banking and Wealth Management and Investment Services, partially offset by a decrease in Corporate and Commercial

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Banking. Average time deposits were $5.3 billion (16.8 percent) higher than the prior year quarter. Changes in time deposits are largely related to those deposits managed as an alternative to other funding sources such as wholesale borrowing, based largely on relative pricing and liquidity characteristics.

Average total deposits increased $4.0 billion (1.2 percent) over the third quarter of 2017. On a linked quarter basis, average noninterest-bearing deposits increased slightly and average total savings deposits grew $3.1 billion (1.4 percent) reflecting increases in Consumer and Business Banking and Wealth Management and Investment Services. Average time deposits, which are managed based on funding needs, relative pricing and liquidity characteristics, increased $622 million (1.7 percent) on a linked quarter basis.

NONINTEREST INCOME																		Table 6
($ in millions)							Percent			Percent
							Change			Change
	4Q		3Q		4Q		4Q17 vs			4Q17 vs			Full Year		Full Year		Percent
	2017		2017		2016		3Q17			4Q16			2017		2016		Change
Credit and debit card revenue	$	333	$	308	$	316		8.1			5.4		$	1,252	$	1,177		6.4
Corporate payment products revenue		189		201		171		(6.0	)		10.5			753		712		5.8
Merchant processing services		400		405		404		(1.2	)		(1.0	)		1,590		1,592		(.1	)
ATM processing services		95		92		87		3.3			9.2			362		338		7.1
Trust and investment management fees		394		380		368		3.7			7.1			1,522		1,427		6.7
Deposit service charges		198		192		186		3.1			6.5			751		725		3.6
Treasury management fees		152		153		147		(.7	)		3.4			618		583		6.0
Commercial products revenue		211		221		217		(4.5	)		(2.8	)		849		871		(2.5	)
Mortgage banking revenue		202		213		240		(5.2	)		(15.8	)		834		979		(14.8	)
Investment products fees		43		39		38		10.3			13.2			163		158		3.2
Securities gains (losses), net		10		9		6		11.1			66.7			57		22		nm
Other		214		209		251		2.4			(14.7	)		860		993		(13.4	)
Total noninterest income	$	2,441	$	2,422	$	2,431		.8			.4		$	9,611	$	9,577		.4

Noninterest Income

Fourth quarter noninterest income of $2,441 million was $10 million (0.4 percent) higher than the fourth quarter of 2016 principally due to higher payment services revenue, trust and investment management fees, and deposit service charges, partially offset by lower mortgage banking and other revenue. Payment services revenue was higher due to an increase in corporate payment products revenue of $18 million (10.5 percent) and an increase in credit and debit card revenue of $17 million (5.4 percent), both driven by higher sales volumes. These increases were partially offset by a decrease in merchant processing services revenue of $4

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January 17, 2018

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million (1.0 percent) mainly due to exiting certain joint ventures in the second quarter of 2017. Trust and investment management fees increased $26 million (7.1 percent) principally due to favorable market conditions and net asset and account growth. Deposit service charges increased $12 million (6.5 percent) primarily due to higher transaction volumes and account growth. Mortgage banking revenue decreased $38 million (15.8 percent) primarily due to lower origination and sales volumes from home refinancing activities which were higher in the prior year quarter and lower margins on mortgage loan sales. Other revenue decreased $37 million (14.7 percent) primarily due to lower equity investment income in the current quarter.

Noninterest income was $19 million (0.8 percent) higher in the fourth quarter of 2017 than the third quarter of 2017 reflecting growth in trust and investment management fees, payment services revenue and deposit service charges, partially offset by lower mortgage banking revenue and commercial products revenue. Trust and investment management fees increased $14 million (3.7 percent) driven by account growth and favorable market conditions. Payment services revenue was higher due to an increase in credit and debit card revenue of $25 million (8.1 percent) primarily due to seasonally higher sales volumes. This increase was partially offset by an expected seasonal decline in corporate payment products revenue of $12 million (6.0 percent) and merchant processing services revenue of $5 million (1.2 percent) due to seasonally lower sales volumes. Deposit service charges increased $6 million (3.1 percent) due to higher transaction volumes. Mortgage banking revenue decreased $11 million (5.2 percent) primarily due to the valuation of mortgage servicing rights, net of hedging activities, along with lower origination and sales volumes and lower margins on related sales. Commercial products revenue decreased $10 million (4.5 percent) primarily driven by lower corporate bond fees.

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U.S. Bancorp Reports Fourth Quarter 2017 Results

January 17, 2018

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NONINTEREST EXPENSE																		Table 7
($ in millions)							Percent			Percent
							Change			Change
	4Q		3Q		4Q		4Q17 vs			4Q17 vs			Full Year		Full Year		Percent
	2017		2017		2016		3Q17			4Q16			2017		2016		Change
Compensation	$	1,499	$	1,440	$	1,357		4.1			10.5		$	5,746	$	5,212		10.2
Employee benefits		304		281		261		8.2			16.5			1,186		1,119		6.0
Net occupancy and equipment		259		258		247		.4			4.9			1,019		988		3.1
Professional services		114		104		156		9.6			(26.9	)		419		502		(16.5	)
Marketing and business development		251		92		107		nm			nm			542		435		24.6
Technology and communications		254		246		238		3.3			6.7			977		955		2.3
Postage, printing and supplies		79		82		75		(3.7	)		5.3			323		311		3.9
Other intangibles		44		44		45		—			(2.2	)		175		179		(2.2	)
Other		1,135		492		518		nm			nm			2,558		1,975		29.5
Total noninterest expense	$	3,939	$	3,039	$	3,004		29.6			31.1		$	12,945	$	11,676		10.9

Noninterest Expense

Fourth quarter noninterest expense of $3,939 million was $935 million (31.1 percent) higher than the fourth quarter of 2016 primarily due to notable items which totaled $825 million. This amount consisted of a special bonus to eligible employees, a charitable contribution to the U.S. Bank Foundation, and a $608 million accrual for previously disclosed regulatory and legal matters related to Bank Secrecy Act/anti-money laundering compliance program adequacy and investigations by the United States Attorney’s Office in Manhattan into that program and U.S. Bank National Association’s legacy relationship with payday lending businesses associated with a former customer. The Company is working on a definitive settlement of these matters, which is expected to finalize soon. Excluding the notable items, fourth quarter noninterest expense increased $110 million (3.6 percent) year-over-year primarily due to higher compensation and employee benefits expense, partially offset by lower professional services expense. Compensation expense increased principally due to the impact of hiring to support business growth and compliance programs, merit increases, and higher variable compensation related to business production. The increase in employee benefits expense was primarily driven by increased medical costs. Professional services expense decreased $42 million (26.9 percent) primarily due to fewer consulting services as compliance programs near maturity.

Noninterest expense increased $900 million (29.6 percent) on a linked quarter basis primarily due to the notable items. Excluding the notable items, noninterest expense was $75 million (2.5 percent) higher in the

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fourth quarter of 2017 than the third quarter of 2017 driven by seasonally higher costs related to investments in tax-advantaged projects and seasonally higher professional services expense in addition to an increase in employee benefits expense due to increased medical costs.

Provision for Income Taxes

During the fourth quarter of 2017, tax legislation was enacted that, among other provisions, reduced the statutory tax rate for corporations from 35 percent to 21 percent effective in 2018. In accordance with generally accepted accounting principles, the Company revalued deferred tax assets and liabilities at the end of the fourth quarter of 2017 resulting in an estimated net tax benefit of $910 million during the fourth quarter of 2017. The provision for income taxes for the fourth quarter of 2017 reflects this benefit resulting in a tax benefit of 23.6 percent on a taxable-equivalent basis (effective tax benefit of 28.6 percent), compared with tax expense of 28.6 percent (effective tax rate of 26.9 percent) in the fourth quarter of 2016, and 29.0 percent (effective tax rate of 27.3 percent) in the third quarter of 2017.

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U.S. Bancorp Reports Fourth Quarter 2017 Results

January 17, 2018

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ALLOWANCE FOR CREDIT LOSSES																										Table 8
($ in millions)	4Q 2017			% (b)			3Q 2017			% (b)			2Q 2017			% (b)			1Q 2017			% (b)			4Q 2016			% (b)
Balance, beginning of period	$	4,407					$	4,377					$	4,366					$	4,357					$	4,338
Net charge-offs
Commercial		22			.09			79			.34			75			.33			71			.33			71			.32
Lease financing		6			.44			4			.29			3			.22			4			.30			5			.37
Total commercial		28			.11			83			.34			78			.33			75			.32			76			.32
Commercial mortgages		18			.24			(2	)		(.03	)		(7	)		(.09	)		(1	)		(.01	)		(3	)		(.04	)
Construction and development		—			—			(5	)		(.17	)		(2	)		(.07	)		(1	)		(.03	)		(6	)		(.21	)
Total commercial real estate		18			.17			(7	)		(.07	)		(9	)		(.08	)		(2	)		(.02	)		(9	)		(.08	)
Residential mortgages		10			.07			7			.05			8			.05			12			.08			12			.08
Credit card		205			3.83			187			3.55			204			3.97			190			3.70			181			3.44
Retail leasing		3			.15			2			.10			2			.11			3			.19			1			.06
Home equity and second mortgages		(2	)		(.05	)		(1	)		(.02	)		(1	)		(.02	)		(1	)		(.02	)		(1	)		(.02	)
Other		63			.76			59			.73			58			.75			58			.76			62			.79
Total other retail		64			.44			60			.42			59			.43			60			.45			62			.46
Total net charge-offs, excluding covered loans		325			.47			330			.48			340			.50			335			.50			322			.48
Covered loans		—			—			—			—			—			—			—			—			—			—
Total net charge-offs		325			.46			330			.47			340			.49			335			.50			322			.47
Provision for credit losses		335						360						350						345						342
Other changes (a)		—						—						1						(1	)					(1	)
Balance, end of period	$	4,417					$	4,407					$	4,377					$	4,366					$	4,357
Components
Allowance for loan losses	$	3,925					$	3,908					$	3,856					$	3,816					$	3,813
Liability for unfunded credit commitments		492						499						521						550						544
Total allowance for credit losses	$	4,417					$	4,407					$	4,377					$	4,366					$	4,357
Gross charge-offs	$	464					$	433					$	437					$	417					$	405
Gross recoveries	$	139					$	103					$	97					$	82					$	83
Allowance for credit losses as a percentage of
Period-end loans, excluding covered loans		1.58						1.59						1.59						1.61						1.60
Nonperforming loans, excluding covered loans		438						425						385						338						317
Nonperforming assets, excluding covered assets		374						359						331						296						275
Period-end loans		1.58						1.58						1.58						1.60						1.59
Nonperforming loans		438						426						383						338						318
Nonperforming assets		368						352						324						292						272

(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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January 17, 2018

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Credit Quality

The Company’s provision for credit losses for the fourth quarter of 2017 was $335 million, which was $25 million (6.9 percent) lower than the prior quarter and $7 million (2.0 percent) lower than the fourth quarter of 2016. Credit quality was relatively stable compared with the third quarter of 2017.

Total net charge-offs in the fourth quarter of 2017 were $325 million, compared with $330 million in the third quarter of 2017, and $322 million in the fourth quarter of 2016. Net charge-offs decreased $5 million (1.5 percent) compared with the third quarter of 2017 mainly due to lower total commercial loan net charge-offs driven by higher recoveries, partially offset by higher total commercial real estate and credit card loan net charge-offs. Net charge-offs increased $3 million (0.9 percent) compared with the fourth quarter of 2016 primarily due to higher total commercial real estate and credit card loan net charge-offs, mostly offset by lower total commercial loan net charge-offs driven by higher recoveries. The net charge-off ratio was 0.46 percent in the fourth quarter of 2017, compared with 0.47 percent in the third quarter of 2017 and in the fourth quarter of 2016.

The allowance for credit losses was $4,417 million at December 31, 2017, compared with $4,407 million at September 30, 2017, and $4,357 million at December 31, 2016. The ratio of the allowance for credit losses to period-end loans was 1.58 percent at December 31, 2017 and at September 30, 2017, compared with 1.59 percent at December 31, 2016. The ratio of the allowance for credit losses to nonperforming loans was 438 percent at December 31, 2017, compared with 426 percent at September 30, 2017, and 318 percent at December 31, 2016.

Nonperforming assets were $1,200 million at December 31, 2017, compared with $1,251 million at September 30, 2017, and $1,603 million at December 31, 2016. The ratio of nonperforming assets to loans and other real estate was 0.43 percent at December 31, 2017, compared with 0.45 percent at September 30, 2017, and 0.59 percent at December 31, 2016. The linked quarter and year-over-year decreases in nonperforming assets were driven by improvements in total commercial loans, residential mortgages and other real estate owned, partially offset by an increase in total commercial real estate loans. Accruing loans 90 days or more past due were $720 million ($572 million excluding covered loans) at December 31, 2017, compared with $649 million ($497 million excluding covered loans) at September 30, 2017, and $764 million ($552 million excluding covered loans) at December 31, 2016.

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U.S. Bancorp Reports Fourth Quarter 2017 Results

January 17, 2018

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DELINQUENT LOAN RATIOS AS A PERCENT OF ENDING LOAN BALANCES										Table 9
(Percent)
	Dec 31 2017		Sep 30 2017		Jun 30 2017		Mar 31 2017		Dec 31 2016
Delinquent loan ratios - 90 days or more past due excluding nonperforming loans
Commercial		.06		.05		.05		.06		.06
Commercial real estate		.01		.01		—		.01		.02
Residential mortgages		.22		.18		.20		.24		.27
Credit card		1.28		1.20		1.10		1.23		1.16
Other retail		.17		.15		.14		.14		.15
Total loans, excluding covered loans		.21		.18		.17		.19		.20
Covered loans		4.74		4.66		4.71		5.34		5.53
Total loans		.26		.23		.23		.26		.28
Delinquent loan ratios - 90 days or more past due including nonperforming loans
Commercial		.31		.33		.39		.52		.57
Commercial real estate		.37		.30		.29		.27		.31
Residential mortgages		.96		.98		1.10		1.23		1.31
Credit card		1.28		1.20		1.10		1.24		1.18
Other retail		.46		.43		.42		.43		.45
Total loans, excluding covered loans		.57		.55		.59		.67		.71
Covered loans		4.93		4.84		5.06		5.53		5.68
Total loans		.62		.60		.64		.73		.78

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January 17, 2018

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ASSET QUALITY										Table 10
($ in millions)
	Dec 31 2017		Sep 30 2017		Jun 30 2017		Mar 31 2017		Dec 31 2016
Nonperforming loans
Commercial	$	225	$	231	$	283	$	397	$	443
Lease financing		24		38		39		42		40
Total commercial		249		269		322		439		483
Commercial mortgages		108		89		84		74		87
Construction and development		34		33		35		36		37
Total commercial real estate		142		122		119		110		124
Residential mortgages		442		474		530		575		595
Credit card		1		1		1		2		3
Other retail		168		163		158		157		157
Total nonperforming loans, excluding covered loans		1,002		1,029		1,130		1,283		1,362
Covered loans		6		6		12		7		6
Total nonperforming loans		1,008		1,035		1,142		1,290		1,368
Other real estate (a)		141		164		157		155		186
Covered other real estate (a)		21		26		25		22		26
Other nonperforming assets		30		26		25		28		23
Total nonperforming assets (b)	$	1,200	$	1,251	$	1,349	$	1,495	$	1,603
Total nonperforming assets, excluding covered assets	$	1,173	$	1,219	$	1,312	$	1,466	$	1,571
Accruing loans 90 days or more past due, excluding covered loans	$	572	$	497	$	477	$	524	$	552
Accruing loans 90 days or more past due	$	720	$	649	$	639	$	718	$	764
Performing restructured loans, excluding GNMA and covered loans	$	2,306	$	2,419	$	2,473	$	2,478	$	2,557
Performing restructured GNMA and covered loans	$	1,713	$	1,600	$	1,803	$	1,746	$	1,604
Nonperforming assets to loans plus ORE, excluding covered assets (%)		.42		.44		.48		.54		.58
Nonperforming assets to loans plus ORE (%)		.43		.45		.49		.55		.59

(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.

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January 17, 2018

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COMMON SHARES														Table 11
(Millions)	4Q 2017			3Q 2017			2Q 2017			1Q 2017			4Q 2016
Beginning shares outstanding		1,667			1,679			1,692			1,697			1,705
Shares issued for stock incentive plans, acquisitions and other corporate purposes		1			—			1			6			6
Shares repurchased		(12	)		(12	)		(14	)		(11	)		(14	)
Ending shares outstanding		1,656			1,667			1,679			1,692			1,697

CAPITAL POSITION														Table 12
($ in millions)	Dec 31 2017			Sep 30 2017			Jun 30 2017			Mar 31 2017			Dec 31 2016
Total U.S. Bancorp shareholders’ equity	$	49,040		$	48,723		$	48,320		$	47,798		$	47,298
Standardized Approach
Basel III transitional standardized approach
Common equity tier 1 capital	$	34,369		$	34,876		$	34,408		$	33,847		$	33,720
Tier 1 capital		39,806			40,411			39,943			39,374			39,421
Total risk-based capital		47,503			48,104			47,824			47,279			47,355
Common equity tier 1 capital ratio		9.3	%		9.6	%		9.5	%		9.5	%		9.4	%
Tier 1 capital ratio		10.8			11.1			11.1			11.0			11.0
Total risk-based capital ratio		12.9			13.2			13.2			13.3			13.2
Leverage ratio		8.9			9.1			9.1			9.1			9.0
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented standardized approach (a)		9.1			9.4			9.3			9.2			9.1
Advanced Approaches
Common equity tier 1 capital to risk-weighted assets for the Basel III transitional advanced approaches		12.0			12.1			12.0			11.8			12.2
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented advanced approaches (a)		11.6			11.8			11.7			11.5			11.7
Tangible common equity to tangible assets (a)		7.6			7.7			7.5			7.6			7.5
Tangible common equity to risk-weighted assets (a)		9.4			9.5			9.4			9.4			9.2

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 following four years to full implementation by January 1, 2018. Basel III includes two comprehensive methodologies for calculating risk-weighted assets: a general standardized approach and more risk-sensitive advanced approaches, with the Company’s capital adequacy being evaluated against the methodology that is most restrictive.

(a) See Non-GAAP Financial Measures reconciliation on page 23

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January 17, 2018

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Capital Management

Total U.S. Bancorp shareholders’ equity was $49.0 billion at December 31, 2017, compared with $48.7 billion at September 30, 2017, and $47.3 billion at December 31, 2016. During the fourth quarter, the Company returned 72 percent of earnings to shareholders through dividends and share buybacks.

All regulatory ratios continue to be in excess of “well-capitalized” requirements. The estimated common equity tier 1 capital to risk-weighted assets ratio using the Basel III fully implemented standardized approach was 9.1 percent at December 31, 2017, compared with 9.4 percent at September 30, 2017, and 9.1 percent at December 31, 2016. The estimated common equity tier 1 capital to risk-weighted assets ratio using the Basel III fully implemented advanced approaches method was 11.6 percent at December 31, 2017, compared with 11.8 percent at September 30, 2017, and 11.7 percent at December 31, 2016.

On Wednesday, January 17, 2018, at 8:00 a.m. CST, Andy Cecere, president and chief executive officer, and Terry Dolan, vice chairman and chief financial officer, will host a conference call to review the financial results. The conference call will be available online or by telephone. 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 near the bottom of the page. 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 8669609. For those unable to participate during the live call, a recording will be available at approximately 11:00 a.m. CST on Wednesday, January 17 and will be accessible through Wednesday, January 24 at 11:00 p.m. CST. To access the recorded message within the United States and Canada, please 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 8669609.

Minneapolis-based U.S. Bancorp (NYSE: USB), with $462 billion in assets as of December 31, 2017, is the parent company of U.S. Bank National Association, the fifth largest commercial bank in the United States. The Company operates 3,067 banking offices in 25 states and 4,771 ATMs and provides a comprehensive line of banking, investment, mortgage, trust and payment services products to consumers, businesses and institutions. Visit U.S. Bancorp on the web at www.usbank.com.

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January 17, 2018

Page 19

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 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. Stress in the commercial real estate markets, as well as a downturn in the residential real estate markets could cause credit losses and deterioration in asset values. In addition, changes to statutes, regulations, or regulatory policies or practices could affect U.S. Bancorp in substantial and unpredictable ways. 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; litigation; 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, 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, 2016, 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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January 17, 2018

Page 20

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, and

• Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented advanced approaches.

These capital measures are viewed by management as useful additional methods of reflecting the level of capital available to withstand unexpected negative 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 of the currently effective ratios, which are subject to certain transitional provisions, temporarily excludes a portion of unrealized gains and losses related to available-for-sale securities and retirement plan obligations, and includes a portion of capital related to intangible assets, other than mortgage servicing rights. These capital 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 capital measures disclosed by the Company may be considered non-GAAP financial measures.

The Company also discloses net interest income and related ratios and analysis on a taxable-equivalent basis, which may also be considered non-GAAP financial measures. The Company believes this presentation to be the preferred industry measurement of net interest income as it provides a relevant comparison of net interest income arising from taxable and tax-exempt sources. In addition, certain performance measures, including the efficiency ratio and net interest margin utilize net interest income on a taxable-equivalent basis.

In addition, certain performance measures are presented excluding notable items in the fourth quarter of 2017. Management believes this information helps investors understand the effect of these items on reported results.

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     

(Dollars and Shares in Millions, Except Per Share Data)	Three Months Ended December 31,						Year Ended December 31,
(Unaudited)	2017			2016			2017			2016
Interest Income
Loans	$	3,070		$	2,771		$	11,827		$	10,810
Loans held for sale		40			44			144			154
Investment securities		579			523			2,232			2,078
Other interest income		51			36			182			125
Total interest income		3,740			3,374			14,385			13,167
Interest Expense
Deposits		311			170			1,041			622
Short-term borrowings		86			62			319			263
Long-term debt		199			187			784			754
Total interest expense		596			419			2,144			1,639
Net interest income		3,144			2,955			12,241			11,528
Provision for credit losses		335			342			1,390			1,324
Net interest income after provision for credit losses		2,809			2,613			10,851			10,204
Noninterest Income
Credit and debit card revenue		333			316			1,252			1,177
Corporate payment products revenue		189			171			753			712
Merchant processing services		400			404			1,590			1,592
ATM processing services		95			87			362			338
Trust and investment management fees		394			368			1,522			1,427
Deposit service charges		198			186			751			725
Treasury management fees		152			147			618			583
Commercial products revenue		211			217			849			871
Mortgage banking revenue		202			240			834			979
Investment products fees		43			38			163			158
Securities gains (losses), net		10			6			57			22
Other		214			251			860			993
Total noninterest income		2,441			2,431			9,611			9,577
Noninterest Expense
Compensation		1,499			1,357			5,746			5,212
Employee benefits		304			261			1,186			1,119
Net occupancy and equipment		259			247			1,019			988
Professional services		114			156			419			502
Marketing and business development		251			107			542			435
Technology and communications		254			238			977			955
Postage, printing and supplies		79			75			323			311
Other intangibles		44			45			175			179
Other		1,135			518			2,558			1,975
Total noninterest expense		3,939			3,004			12,945			11,676
Income before income taxes		1,311			2,040			7,517			8,105
Applicable income taxes		(375	)		549			1,264			2,161
Net income		1,686			1,491			6,253			5,944
Net (income) loss attributable to noncontrolling interests		(4	)		(13	)		(35	)		(56	)
Net income attributable to U.S. Bancorp	$	1,682		$	1,478		$	6,218		$	5,888
Net income applicable to U.S. Bancorp common shareholders	$	1,611		$	1,391		$	5,913		$	5,589
Earnings per common share	$	.97		$	.82		$	3.53		$	3.25
Diluted earnings per common share	$	.97		$	.82		$	3.51		$	3.24
Dividends declared per common share	$	.30		$	.28		$	1.16		$	1.07
Average common shares outstanding		1,659			1,700			1,677			1,718
Average diluted common shares outstanding		1,664			1,705			1,683			1,724

Page 21

U.S. Bancorp     

Consolidated Ending Balance Sheet     

(Dollars in Millions)	December 31, 2017			December 31, 2016
Assets
Cash and due from banks	$	19,505		$	15,705
Investment securities
Held-to-maturity		44,362			42,991
Available-for-sale		68,137			66,284
Loans held for sale		3,554			4,826
Loans
Commercial		97,561			93,386
Commercial real estate		40,463			43,098
Residential mortgages		59,783			57,274
Credit card		22,180			21,749
Other retail		57,324			53,864
Total loans, excluding covered loans		277,311			269,371
Covered loans		3,121			3,836
Total loans		280,432			273,207
Less allowance for loan losses		(3,925	)		(3,813	)
Net loans		276,507			269,394
Premises and equipment		2,432			2,443
Goodwill		9,434			9,344
Other intangible assets		3,228			3,303
Other assets		34,881			31,674
Total assets	$	462,040		$	445,964
Liabilities and Shareholders’ Equity
Deposits
Noninterest-bearing	$	87,557		$	86,097
Interest-bearing		259,658			248,493
Total deposits		347,215			334,590
Short-term borrowings		16,651			13,963
Long-term debt		32,259			33,323
Other liabilities		16,249			16,155
Total liabilities		412,374			398,031
Shareholders’ equity
Preferred stock		5,419			5,501
Common stock		21			21
Capital surplus		8,464			8,440
Retained earnings		54,142			50,151
Less treasury stock		(17,602	)		(15,280	)
Accumulated other comprehensive income (loss)		(1,404	)		(1,535	)
Total U.S. Bancorp shareholders’ equity		49,040			47,298
Noncontrolling interests		626			635
Total equity		49,666			47,933
Total liabilities and equity	$	462,040		$	445,964

Page 22

U.S. Bancorp

Non-GAAP Financial Measures

(Dollars in Millions, Unaudited)	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Total equity	$	49,666		$	49,351		$	48,949		$	48,433		$	47,933
Preferred stock		(5,419	)		(5,419	)		(5,419	)		(5,419	)		(5,501	)
Noncontrolling interests		(626	)		(628	)		(629	)		(635	)		(635	)
Goodwill (net of deferred tax liability) (1)		(8,613	)		(8,141	)		(8,181	)		(8,186	)		(8,203	)
Intangible assets, other than mortgage servicing rights		(583	)		(595	)		(634	)		(671	)		(712	)
Tangible common equity (a)		34,425			34,568			34,086			33,522			32,882
Tangible common equity (as calculated above)		34,425			34,568			34,086			33,522			32,882
Adjustments (2)		(550	)		(52	)		(51	)		(136	)		(55	)
Common equity tier 1 capital estimated for the Basel III fully implemented standardized and advanced approaches (b)		33,875			34,516			34,035			33,386			32,827
Total assets		462,040			459,227			463,844			449,522			445,964
Goodwill (net of deferred tax liability) (1)		(8,613	)		(8,141	)		(8,181	)		(8,186	)		(8,203	)
Intangible assets, other than mortgage servicing rights		(583	)		(595	)		(634	)		(671	)		(712	)
Tangible assets (c)		452,844			450,491			455,029			440,665			437,049
Risk-weighted assets, determined in accordance with prescribed transitional standardized approach regulatory requirements (d)		367,771	*		363,957			361,164			356,373			358,237
Adjustments (3)		4,473	*		3,907			3,967			4,731			4,027
Risk-weighted assets estimated for the Basel III fully implemented standardized approach (e)		372,244	*		367,864			365,131			361,104			362,264
Risk-weighted assets, determined in accordance with prescribed transitional advanced approaches regulatory requirements		287,211	*		287,800			287,124			285,963			277,141
Adjustments (4)		4,769	*		4,164			4,231			5,046			4,295
Risk-weighted assets estimated for the Basel III fully implemented advanced approaches (f)		291,980	*		291,964			291,355			291,009			281,436
Ratios*
Tangible common equity to tangible assets (a)/(c)		7.6	%		7.7	%		7.5	%		7.6	%		7.5	%
Tangible common equity to risk-weighted assets (a)/(d)		9.4			9.5			9.4			9.4			9.2
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented standardized approach (b)/(e)		9.1			9.4			9.3			9.2			9.1
Common equity tier 1 capital to risk-weighted assets estimated for the Basel III fully implemented advanced approaches (b)/(f)		11.6			11.8			11.7			11.5			11.7

	Three Months Ended															Year Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Net interest income	$	3,144		$	3,135		$	3,017		$	2,945		$	2,955		$	12,241		$	11,528
Taxable-equivalent adjustment (5)		53			51			51			50			49			205			203
Net interest income, on a taxable-equivalent basis		3,197			3,186			3,068			2,995			3,004			12,446			11,731
Net interest income, on a taxable-equivalent basis (as calculated above)		3,197			3,186			3,068			2,995			3,004			12,446			11,731
Noninterest income		2,441			2,422			2,419			2,329			2,431			9,611			9,577
Less: Securities gains (losses), net		10			9			9			29			6			57			22
Total net revenue, excluding net securities gains (losses) (g)		5,628			5,599			5,478			5,295			5,429			22,000			21,286
Noninterest expense (h)		3,939			3,039			3,023			2,944			3,004			12,945			11,676
Less: Intangible amortization		44			44			43			44			45			175			179
Noninterest expense, excluding intangible amortization (i)		3,895			2,995			2,980			2,900			2,959			12,770			11,497
Efficiency ratio (h)/(g)		70.0	%		54.3	%		55.2	%		55.6	%		55.3	%		58.8	%		54.9	%
Tangible efficiency ratio (i)/(g)		69.2			53.5			54.4			54.8			54.5			58.0			54.0

* 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.

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

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

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

(5) Utilizes a tax rate of 35 percent for those assets and liabilities whose income or expense is not included for federal income tax purposes.

Page 23

U.S. Bancorp

Non-GAAP Financial Measures (continued)

(Dollars and Shares in Millions, Except Per Share Data) (Unaudited)	Three Months Ended December 31, 2017			Year Ended December 31, 2017
Net income applicable to U.S. Bancorp common shareholders	$	1,611		$	5,913
Less: Notable items (1)		150			150
Net income applicable to U.S. Bancorp common shareholders, excluding notable items (a)	$	1,461		$	5,763
Average diluted common shares outstanding (b)		1,664			1,683
Diluted earnings per common share, excluding notable items (a)/(b)	$	.88		$	3.42
Net income attributable to U.S. Bancorp	$	1,682		$	6,218
Less: Notable items (1)		150			150
Net income attributable to U.S. Bancorp, excluding notable items	$	1,532		$	6,068
Annualized net income attributable to U.S. Bancorp, excluding notable items (c)	$	6,078		$	6,068
Average assets (d)	$	456,098		$	448,582
Return on average assets, excluding notable items (c)/(d)		1.33	%		1.35	%
Net income applicable to U.S. Bancorp common shareholders, excluding notable items (as calculated above)	$	1,461		$	5,763
Annualized net income applicable to U.S. Bancorp common shareholders, excluding notable items (e)	$	5,796		$	5,763
Average common equity (f)	$	43,415		$	42,976
Return on average common equity, excluding notable items (e)/(f)		13.4	%		13.4	%

(1) Notable items for the three months ended December 31, 2017, include: $910 million reduction in income tax expense due to tax reform legislation, $608 million regulatory and legal accrual, $105 million (after-tax) contribution to the U.S. Bank Foundation and $47 million (after-tax) special one-time bonus to certain eligible employees.

Page 24

Supplemental Business Line Schedules

4Q 2017

U.S. Bancorp Fourth Quarter 2017 Business Line Results

January 17, 2018

Page 2

LINE OF BUSINESS FINANCIAL PERFORMANCE (a)
($ in millions)
	Net Income Attributable to U.S. Bancorp						Percent Change						Net Income Attributable to U.S. Bancorp							4Q 2017
Business Line	4Q 2017		3Q 2017		4Q 2016		4Q17 vs 3Q17			4Q17 vs 4Q16			Full Year 2017		Full Year 2016		Percent Change			Earnings Composition
Corporate and Commercial Banking	$	291	$	284	$	272		2.5			7.0		$	1,123	$	846		32.7			17	%
Consumer and Business Banking		340		362		296		(6.1	)		14.9			1,311		1,332		(1.6	)		20
Wealth Management and Investment Services		134		125		106		7.2			26.4			498		379		31.4			8
Payment Services		309		302		329		2.3			(6.1	)		1,177		1,312		(10.3	)		19
Treasury and Corporate Support		608		490		475		24.1			28.0			2,109		2,019		4.5			36
Consolidated Company	$	1,682	$	1,563	$	1,478		7.6			13.8		$	6,218	$	5,888		5.6			100%

(a) preliminary data    

Lines of Business

The Company’s major lines of business are Corporate and Commercial Banking, Consumer and Business Banking, Wealth Management and Investment 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 realigned to better respond to the Company’s diverse customer base. During 2017, certain organization and methodology changes were made and, accordingly, prior period results were restated and presented on a comparable basis.

U.S. Bancorp Fourth Quarter 2017 Business Line Results

January 17, 2018

Page 3

CORPORATE AND COMMERCIAL BANKING (a)
($ in millions)
									Percent Change
	4Q 2017			3Q 2017			4Q 2016		4Q17 vs 3Q17			4Q17 vs 4Q16			Full Year 2017			Full Year 2016		Percent Change
Condensed Income Statement
Net interest income (taxable-equivalent basis)	$	619		$	616		$	603		.5			2.7		$	2,425		$	2,241		8.2
Noninterest income		203			215			221		(5.6	)		(8.1	)		900			897		.3
Securities gains (losses), net		—			—			2		—			nm			(3	)		2		nm
Total net revenue		822			831			826		(1.1	)		(.5	)		3,322			3,140		5.8
Noninterest expense		386			392			374		(1.5	)		3.2			1,566			1,440		8.8
Other intangibles		1			1			1		—			—			4			4		—
Total noninterest expense		387			393			375		(1.5	)		3.2			1,570			1,444		8.7
Income before provision and taxes		435			438			451		(.7	)		(3.5	)		1,752			1,696		3.3
Provision for credit losses		(23	)		(9	)		23		nm			nm			(14	)		365		nm
Income before income taxes		458			447			428		2.5			7.0			1,766			1,331		32.7
Income taxes and taxable-equivalent adjustment		167			163			156		2.5			7.1			643			485		32.6
Net income		291			284			272		2.5			7.0			1,123			846		32.7
Net (income) loss attributable to noncontrolling interests		—			—			—		—			—			—			—		—
Net income attributable to U.S. Bancorp	$	291		$	284		$	272		2.5			7.0		$	1,123		$	846		32.7
Average Balance Sheet Data
Loans	$	94,046		$	94,004		$	93,645		—			.4		$	94,000		$	92,049		2.1
Other earning assets		2,988			2,855			2,833		4.7			5.5			2,958			2,452		20.6
Goodwill		1,647			1,647			1,647		—			—			1,647			1,647		—
Other intangible assets		12			13			16		(7.7	)		(25.0	)		13			17		(23.5	)
Assets		102,611			102,328			102,465		.3			.1			102,586			100,570		2.0
Noninterest-bearing deposits		35,320			35,369			37,972		(.1	)		(7.0	)		36,001			36,912		(2.5	)
Interest-bearing deposits		73,491			74,466			72,171		(1.3	)		1.8			71,859			63,993		12.3
Total deposits		108,811			109,835			110,143		(.9	)		(1.2	)		107,860			100,905		6.9
Total U.S. Bancorp shareholders’ equity		9,930			9,952			9,201		(.2	)		7.9			9,872			8,996		9.7

(a) preliminary data

Corporate and Commercial Banking offers lending, equipment finance and small-ticket leasing, depository services, treasury management, capital markets services, international trade services and other financial services to middle market, large corporate, commercial real estate, financial institution, non-profit and public sector clients. Corporate and Commercial Banking contributed $291 million of the Company’s net income in the fourth quarter of 2017, compared with $272 million in the fourth quarter of 2016. Total net revenue decreased $4 million (0.5 percent) due to a $20 million (9.0 percent) decrease in total noninterest income, mostly offset by a $16 million (2.7 percent) increase in net interest income. Net interest income grew year-over-year primarily due to the impact of rising rates on the margin benefit from deposits, partially

U.S. Bancorp Fourth Quarter 2017 Business Line Results

January 17, 2018

Page 4

offset by lower rates on loans, reflecting a competitive marketplace. Total noninterest income decreased year-over-year primarily due to higher loan-related charges in addition to lower foreign currency customer activity from a year ago. Total noninterest expense was $12 million (3.2 percent) higher compared with a year ago due to an increase in variable costs allocated to manage the business. The provision for credit losses decreased $46 million primarily due to a favorable change in the reserve allocation driven by continued stabilization in credit quality in the energy sector.

U.S. Bancorp Fourth Quarter 2017 Business Line Results

January 17, 2018

Page 5

CONSUMER AND BUSINESS BANKING (a)
($ in millions)
							Percent Change
	4Q 2017		3Q 2017		4Q 2016		4Q17 vs 3Q17			4Q17 vs 4Q16			Full Year 2017		Full Year 2016		Percent Change
Condensed Income Statement
Net interest income (taxable-equivalent basis)	$	1,328	$	1,309	$	1,229		1.5			8.1		$	5,117	$	4,752		7.7
Noninterest income		608		632		627		(3.8	)		(3.0	)		2,445		2,526		(3.2	)
Securities gains (losses), net		—		—		—		—			—			—		—		—
Total net revenue		1,936		1,941		1,856		(.3	)		4.3			7,562		7,278		3.9
Noninterest expense		1,292		1,267		1,312		2.0			(1.5	)		5,117		5,058		1.2
Other intangibles		8		8		8		—			—			30		32		(6.3	)
Total noninterest expense		1,300		1,275		1,320		2.0			(1.5	)		5,147		5,090		1.1
Income before provision and taxes		636		666		536		(4.5	)		18.7			2,415		2,188		10.4
Provision for credit losses		102		97		71		5.2			43.7			354		93		nm
Income before income taxes		534		569		465		(6.2	)		14.8			2,061		2,095		(1.6	)
Income taxes and taxable-equivalent adjustment		194		207		169		(6.3	)		14.8			750		763		(1.7	)
Net income		340		362		296		(6.1	)		14.9			1,311		1,332		(1.6	)
Net (income) loss attributable to noncontrolling interests		—		—		—		—			—			—		—		—
Net income attributable to U.S. Bancorp	$	340	$	362	$	296		(6.1	)		14.9		$	1,311	$	1,332		(1.6	)
Average Balance Sheet Data
Loans	$	143,407	$	142,076	$	138,695		.9			3.4		$	141,301	$	136,428		3.6
Other earning assets		4,250		4,304		5,476		(1.3	)		(22.4	)		3,947		4,704		(16.1	)
Goodwill		3,681		3,681		3,681		—			—			3,681		3,682		—
Other intangible assets		2,759		2,701		2,508		2.1			10.0			2,739		2,422		13.1
Assets		158,636		156,733		154,888		1.2			2.4			155,835		151,759		2.7
Noninterest-bearing deposits		28,938		28,701		28,793		.8			.5			27,983		27,516		1.7
Interest-bearing deposits		122,074		121,119		117,392		.8			4.0			120,867		115,309		4.8
Total deposits		151,012		149,820		146,185		.8			3.3			148,850		142,825		4.2
Total U.S. Bancorp shareholders’ equity		11,425		11,489		11,353		(.6	)		.6			11,468		11,192		2.5

(a) preliminary data

Consumer and Business Banking delivers products and services through banking offices, telephone servicing and sales, on-line services, direct mail, ATM processing and mobile devices. It encompasses community banking, metropolitan banking and indirect lending, as well as mortgage banking. Consumer and Business Banking contributed $340 million of the Company’s net income in the fourth quarter of 2017, compared with $296 million in the fourth quarter of 2016. Total net revenue increased $80 million (4.3 percent) due to a $99 million (8.1 percent) increase in net interest income, partially offset by a decrease of $19 million (3.0 percent) in total noninterest income. Net interest income increased year-over-year primarily due to the impact of rising rates on the margin benefit from deposits along with growth in average

U.S. Bancorp Fourth Quarter 2017 Business Line Results

January 17, 2018

Page 6

loan and deposit balances, partially offset by lower spread on loans. Total noninterest income decreased year-over-year principally driven by lower mortgage banking revenue due to lower origination and sales volumes from home refinancing activities which were higher in the prior year quarter and lower margins on mortgage loan sales. Partially offsetting the impact of lower mortgage banking revenue was growth in retail leasing revenue due to stronger end-of-term gains on auto leases, higher deposit service charges and higher ATM processing services fees. Total noninterest expense in the fourth quarter of 2017 decreased $20 million (1.5 percent) from the same quarter of the prior year primarily due to lower professional services expense and lower variable compensation, partially offset by higher net shared services expense. The provision for credit losses increased $31 million (43.7 percent) primarily due to an unfavorable change in the reserve allocation reflecting slower improvements in residential mortgage and home equity credit quality compared with the fourth quarter of 2016.

U.S. Bancorp Fourth Quarter 2017 Business Line Results

January 17, 2018

Page 7

WEALTH MANAGEMENT AND INVESTMENT SERVICES (a)
($ in millions)
									Percent Change
	4Q 2017			3Q 2017		4Q 2016			4Q17 vs 3Q17			4Q17 vs 4Q16			Full Year 2017			Full Year 2016			Percent Change
Condensed Income Statement
Net interest income (taxable-equivalent basis)	$	205		$	192	$	163			6.8			25.8		$	763		$	537			42.1
Noninterest income		424			411		406			3.2			4.4			1,646			1,589			3.6
Securities gains (losses), net		—			—		—			—			—			—			—			—
Total net revenue		629			603		569			4.3			10.5			2,409			2,126			13.3
Noninterest expense		415			401		398			3.5			4.3			1,608			1,511			6.4
Other intangibles		5			5		6			—			(16.7	)		20			24			(16.7	)
Total noninterest expense		420			406		404			3.4			4.0			1,628			1,535			6.1
Income before provision and taxes		209			197		165			6.1			26.7			781			591			32.1
Provision for credit losses		(2	)		1		(2	)		nm			—			(1	)		(4	)		75.0
Income before income taxes		211			196		167			7.7			26.3			782			595			31.4
Income taxes and taxable-equivalent adjustment		77			71		61			8.5			26.2			284			216			31.5
Net income		134			125		106			7.2			26.4			498			379			31.4
Net (income) loss attributable to noncontrolling interests		—			—		—			—			—			—			—			—
Net income attributable to U.S. Bancorp	$	134		$	125	$	106			7.2			26.4		$	498		$	379			31.4
Average Balance Sheet Data
Loans	$	8,802		$	8,598	$	7,652			2.4			15.0		$	8,420		$	7,268			15.9
Other earning assets		168			158		145			6.3			15.9			157			141			11.3
Goodwill		1,569			1,568		1,567			.1			.1			1,568			1,567			.1
Other intangible assets		74			79		93			(6.3	)		(20.4	)		81			101			(19.8	)
Assets		11,979			11,498		10,661			4.2			12.4			11,588			10,358			11.9
Noninterest-bearing deposits		14,766			14,715		15,103			.3			(2.2	)		14,819			13,716			8.0
Interest-bearing deposits		58,593			56,647		53,914			3.4			8.7			57,536			49,923			15.2
Total deposits		73,359			71,362		69,017			2.8			6.3			72,355			63,639			13.7
Total U.S. Bancorp shareholders’ equity		2,345			2,381		2,392			(1.5	)		(2.0	)		2,373			2,382			(.4	)

(a) preliminary data

Wealth Management and Investment 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 Investment Services contributed $134 million of the Company’s net income in the fourth quarter of 2017, compared with $106 million in the fourth quarter of 2016. Total net revenue increased $60 million (10.5 percent) year-over-year driven by an increase in net interest income of $42 million (25.8 percent) principally due to the impact of rising rates on the margin benefit from deposits along with growth in average loan and deposit balances. Total noninterest income

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increased $18 million (4.4 percent) principally due to favorable market conditions and net asset and account growth. Total noninterest expense increased $16 million (4.0 percent) primarily as a result of higher compensation expense, reflecting the impact of higher staffing and merit increases, and higher net shared services expense, partially offset by lower professional services expense. The provision for credit losses was flat compared with the prior year quarter.

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PAYMENT SERVICES (a)

($ in millions)

								Percent Change
	4Q 2017		3Q 2017		4Q 2016			4Q17 vs 3Q17			4Q17 vs 4Q16			Full Year 2017			Full Year 2016			Percent Change
Condensed Income Statement
Net interest income (taxable-equivalent basis)	$	570	$	563	$	562			1.2			1.4		$	2,223		$	2,141			3.8
Noninterest income		927		920		911			.8			1.8			3,613			3,562			1.4
Securities gains (losses), net		—		—		—			—			—			—			—			—
Total net revenue		1,497		1,483		1,473			.9			1.6			5,836			5,703			2.3
Noninterest expense		693		708		660			(2.1	)		5.0			2,761			2,601			6.2
Other intangibles		30		30		30			—			—			121			119			1.7
Total noninterest expense		723		738		690			(2.0	)		4.8			2,882			2,720			6.0
Income before provision and taxes		774		745		783			3.9			(1.1	)		2,954			2,983			(1.0	)
Provision for credit losses		288		270		254			6.7			13.4			1,082			869			24.5
Income before income taxes		486		475		529			2.3			(8.1	)		1,872			2,114			(11.4	)
Income taxes and taxable-equivalent adjustment		177		173		193			2.3			(8.3	)		682			770			(11.4	)
Net income		309		302		336			2.3			(8.0	)		1,190			1,344			(11.5	)
Net (income) loss attributable to noncontrolling interests		—		—		(7	)		—			nm			(13	)		(32	)		59.4
Net income attributable to U.S. Bancorp	$	309	$	302	$	329			2.3			(6.1	)	$	1,177		$	1,312			(10.3	)
Average Balance Sheet Data
Loans	$	30,157	$	29,612	$	29,265			1.8			3.0		$	29,448		$	28,549			3.1
Other earning assets		246		241		258			2.1			(4.7	)		246			350			(29.7	)
Goodwill		2,482		2,469		2,456			.5			1.1			2,465			2,463			.1
Other intangible assets		373		385		465			(3.1	)		(19.8	)		401			493			(18.7	)
Assets		35,700		35,035		34,871			1.9			2.4			35,020			34,389			1.8
Noninterest-bearing deposits		1,078		1,029		964			4.8			11.8			1,037			951			9.0
Interest-bearing deposits		104		103		99			1.0			5.1			102			97			5.2
Total deposits		1,182		1,132		1,063			4.4			11.2			1,139			1,048			8.7
Total U.S. Bancorp shareholders’ equity		6,239		6,206		6,469			.5			(3.6	)		6,269			6,389			(1.9	)

(a) preliminary data

Payment Services includes consumer and business credit cards, stored-value cards, debit cards, corporate, government and purchasing card services, consumer lines of credit and merchant processing. Payment Services contributed $309 million of the Company’s net income in the fourth quarter of 2017, compared with $329 million in the fourth quarter of 2016. Total net revenue increased $24 million (1.6 percent) due to an $8 million (1.4 percent) increase in net interest income and a $16 million (1.8 percent) increase in total noninterest income. Net interest income increased year-over-year primarily due to higher loan volumes and rising interest rates. Total noninterest income increased year-over-year primarily due to higher corporate payment products revenue and credit and debit card revenue driven by higher sales. Total

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noninterest expense increased $33 million (4.8 percent) over the fourth quarter of 2016 principally due to higher net shared services expense, driven by costs to support business growth, and higher compensation and employee benefits expense, reflecting higher staffing to support business investment and compliance programs and merit increases. The provision for credit losses increased $34 million (13.4 percent) due to higher net charge-offs and an unfavorable change in the reserve allocation.

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TREASURY AND CORPORATE SUPPORT (a)

($ in millions)

										Percent Change
	4Q 2017			3Q 2017			4Q 2016			4Q17 vs 3Q17			4Q17 vs 4Q16			Full Year 2017			Full Year 2016			Percent Change
Condensed Income Statement
Net interest income (taxable-equivalent basis)	$	475		$	506		$	447			(6.1	)		6.3		$	1,918		$	2,060			(6.9	)
Noninterest income		269			235			260			14.5			3.5			950			981			(3.2	)
Securities gains (losses), net		10			9			4			11.1			nm			60			20			nm
Total net revenue		754			750			711			.5			6.0			2,928			3,061			(4.3	)
Noninterest expense		1,109			227			215			nm			nm			1,718			887			93.7
Other intangibles		—			—			—			—			—			—			—			—
Total noninterest expense		1,109			227			215			nm			nm			1,718			887			93.7
Income (loss) before provision and taxes		(355	)		523			496			nm			nm			1,210			2,174			(44.3	)
Provision for credit losses		(30	)		1			(4	)		nm			nm			(31	)		1			nm
Income (loss) before income taxes		(325	)		522			500			nm			nm			1,241			2,173			(42.9	)
Income taxes and taxable-equivalent adjustment		(937	)		26			19			nm			nm			(890	)		130			nm
Net income		612			496			481			23.4			27.2			2,131			2,043			4.3
Net (income) loss attributable to noncontrolling interests		(4	)		(6	)		(6	)		33.3			33.3			(22	)		(24	)		8.3
Net income attributable to U.S. Bancorp	$	608		$	490		$	475			24.1			28.0		$	2,109		$	2,019			4.5
Average Balance Sheet Data
Loans	$	3,339		$	3,336		$	3,414			.1			(2.2	)	$	3,368		$	3,517			(4.2	)
Other earning assets		126,107			123,641			120,588			2.0			4.6			122,576			114,419			7.1
Goodwill		—			—			—			—			—			—			—			—
Other intangible assets		—			—			—			—			—			—			—			—
Assets		147,172			145,036			142,018			1.5			3.6			143,553			136,237			5.4
Noninterest-bearing deposits		2,201			2,150			2,060			2.4			6.8			2,093			2,081			.6
Interest-bearing deposits		2,597			852			715			nm			nm			1,217			2,312			(47.4	)
Total deposits		4,798			3,002			2,775			59.8			72.9			3,310			4,393			(24.7	)
Total U.S. Bancorp shareholders’ equity		18,895			18,791			18,220			.6			3.7			18,484			18,380			.6

(a) preliminary data

Treasury and Corporate Support includes the Company’s investment portfolios, funding, capital management, interest rate risk management, income taxes not allocated to the 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 $608 million in the fourth quarter of 2017, compared with $475 million in the fourth quarter of 2016. The increase in net income of $133 million (28.0 percent) year-over-year is primarily related to the notable items which included the impacts of tax reform, a special bonus to eligible employees, a charitable contribution to the U.S. Bank Foundation and a regulatory and legal accrual. Total net revenue increased

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$43 million (6.0 percent) due to a $28 million (6.3 percent) increase in net interest income and a $15 million (5.7 percent) increase in total noninterest income. Net interest income increased year-over-year principally due to growth in the investment portfolio. Total noninterest income increased year-over-year primarily due to lower loan-related charges. Total noninterest expense increased $894 million over the fourth quarter of 2016 principally due to the impacts of the notable items including a special bonus to eligible employees, a charitable contribution to the U.S. Bank foundation and a regulatory and legal accrual. The provision for credit losses decreased by $26 million primarily due to lower net charge-offs reflecting higher recoveries in the current quarter. Income tax expense decreased by $956 million primarily due to the impacts of tax reform on the Company’s tax related assets and liabilities.

EX-99.2

U.S. Bancorp 4Q17 Earnings Conference Call January 17, 2018 Exhibit 99.2

Forward-looking Statements and Additional Information The following information appears in accordance with the Private Securities Litigation Reform Act of 1995: Today’s presentation 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 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. Stress in the commercial real estate markets, as well as a downturn in the residential real estate markets could cause credit losses and deterioration in asset values. In addition, changes to statutes, regulations, or regulatory policies or practices could affect U.S. Bancorp in substantial and unpredictable ways. 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; litigation; 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, 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, 2016, 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. This presentation includes non-GAAP financial measures to describe U.S. Bancorp’s performance. The calculations of these measures are provided in the Appendix. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Notable Items 4Q17 notable items include: $910 million increase to net earnings related to the impacts of tax reform legislation passed in late 4Q17 $608 million legal and regulatory accrual $150 million contribution to the U.S. Bank Foundation $67 million one-time bonus to certain eligible employees $ in millions, except EPS

4Q17 Highlights * Taxable-equivalent basis; see slide 26 for calculation ** Estimated for the Basel III fully implemented standardized approach; RWA = risk-weighted assets, see slide 25 for calculation

Performance Ratios Return on Average Common Equity Efficiency Ratio** & Net Interest Margin*** * Excluding notable items; see slide 26 for calculation ** Non-GAAP; see slide 26 for calculation *** Taxable-equivalent basis Return on Average Assets 14.7% 1.46% 70.0%

Average Loans +0.8% linked quarter +2.6% year-over-year Linked quarter growth in total loans was driven primarily by other retail loans, commercial loans and residential mortgage Year-over-year and linked quarter declines in commercial real estate loans reflected disciplined underwriting of construction and development loans and payoffs of commercial mortgages as customers accessed capital markets $ in billions

Average Deposits +1.2% linked quarter +3.0% year-over-year $ in billions Rates are presented on a fully taxable-equivalent basis utilizing a tax rate of 35 percent Interest-bearing Deposits Average noninterest-bearing deposits increased 0.4% on a linked quarter basis Average noninterest-bearing deposits decreased 3.0% year-over-year, primarily driven by a decrease in Corporate and Commercial Banking deposits

Credit Quality $ in millions NCO Ratio -1bp QoQ -1bp YoY NPAs -4.1% QoQ -25.1% YoY

Earnings Summary

Net Interest Income Linked Quarter Net interest income growth was driven by loan growth and the impact of rising interest rates The decrease in the net interest margin was primarily due to higher interest recoveries in 3Q17 Year-over-Year Net interest income growth was driven primarily by the impact of rising interest rates and loan growth $ in millions Taxable-equivalent basis +0.3% linked quarter +6.4% year-over-year

Noninterest Income $ in millions Payments = credit and debit card, corporate payment products and merchant processing Service charges = deposit service charges, treasury management and ATM processing $2,431 $2,422 $2,441 Linked Quarter Noninterest income growth was driven by trust and investment management fees, payment services revenue and deposit service charges, partially offset by lower mortgage banking revenue and commercial products revenue Year-over-Year Noninterest income growth was partially offset by lower mortgage banking and other revenue Payment services revenue growth was driven by higher corporate payment products revenue and higher credit and debit card revenue Growth in trust and investment management fees reflected favorable market conditions and account growth Growth in deposit service charges was driven by higher transaction volumes and account growth +0.8% linked quarter +0.4% year-over-year

Noninterest Expense $3,004 $3,039 $3,939 Linked Quarter Fourth quarter noninterest expense included notable items which totaled $825 million Excluding notable items, noninterest expense increased 2.5%, driven by seasonally higher costs related to investments in tax-advantaged projects, seasonally higher professional services expense, and an increase in employee benefits expense due to increased medical costs Year-over-Year Excluding notable items, noninterest expense increased 3.6% due to higher compensation and employee benefits expense, partially offset by lower professional services expense $ in millions +29.6% linked quarter +31.1% year-over-year Excluding notable items: +2.5% linked quarter +3.6% year-over-year

Capital Position RWA = risk-weighted assets * See Non-GAAP Financial Measures reconciliation on slide 25

Appendix

Average Loans vs. 4Q16 Average total loans increased by $7.1 billion, or 2.6% Average commercial loans increased by $3.8 billion, or 4.0% Average retail loans increased by $3.3 billion, or 6.0% Average residential mortgage loans increased by $2.9 billion, or 5.2% vs. 3Q17 Average total loans increased by $2.1 billion, or 0.8% Average commercial loans increased by $0.9 billion, or 1.0% Average retail loans increased by $1.1 billion, or 1.9% Average residential mortgage loans increased by $0.6 billion, or 1.0% * Excluding the 4Q15 credit card portfolio acquisition Key Points Year-over-Year Growth 6.2% 4.1% 3.4% 3.0% 2.6% Covered Commercial CRE Res Mtg Retail Credit Card $275.5 $272.7 $273.2 5.5% $279.8 Average Loans ($bn)

Average Deposits Key Points Average Deposits ($bn) vs. 4Q16 Average total deposits increased by $10.0 billion, or 3.0% Average low-cost deposits (NIB, interest checking, money market and savings) increased by $4.7 billion, or 1.6% vs. 3Q17 Average total deposits increased by $4.0 billion, or 1.2% Average low-cost deposits increased by $3.4 billion, or 1.1% Year-over-Year Growth 11.8% 11.0% 7.7% 5.2% 3.0% Time Money Market Checking and Savings Noninterest-bearing $339.2 $329.2 $328.4 $331.2 $335.2

Credit Quality – Commercial Loans Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$93,807$96,633$97,558 30-89 Delinquencies0.28%0.22%0.26% 90+ Delinquencies0.06%0.05%0.06% Nonperforming Loans0.52%0.28%0.26% 2017 loan growth was driven by up-tiering customer relationships and supporting merger and acquisition activity 4Q17 net charge-offs improved due to higher recoveries

Credit Quality – Commercial Real Estate Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$43,391$41,621$41,009 30-89 Delinquencies0.10%0.15%0.09% 90+ Delinquencies0.02%0.01%0.01% Nonperforming Loans0.29%0.29%0.35% Performing TDRs*$169$141$138 * TDR = troubled debt restructuring Investor $19,277 Owner Occupied $10,266 A&D Const $399 Multi-family $4,178 Retail $732 Residential Construction $1,917 Office $794 Other $2,791 Resi Land $655 Average loans declined in 2017 due to loan payoffs as a result of strong permanent loan market liquidity Higher charge-offs in 4Q17 driven by write-downs of enclosed malls and lower recoveries

Credit Quality – Residential Mortgage Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$56,718$59,030$59,639 30-89 Delinquencies0.26%0.26%0.33% 90+ Delinquencies0.27%0.18%0.22% Nonperforming Loans1.04%0.80%0.74% * Excludes GNMA loans, whose repayments are insured by the FHA or guaranteed by the Department of VA ($1,681 million in 4Q17) Originations continued to be high credit quality (weighted average FICO of 757, weighted average LTV of 70%) More than 91% of 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

Credit Quality – Credit Card Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$20,942$20,926$21,218 30-89 Delinquencies1.31%1.42%1.37% 90+ Delinquencies1.16%1.20%1.28% Nonperforming Loans0.01%0.00%0.00% Year-over-year average loan growth of 1.3% driven by high credit quality originations Commitment weighted average FICO on new originations remained strong at 759 Year-over-year increases in delinquency and net charge-off rates primarily reflect vintage maturation

Credit Quality – Home Equity Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$16,444$16,299$16,299 30-89 Delinquencies0.37%0.38%0.48% 90+ Delinquencies0.25%0.24%0.28% Nonperforming Loans0.78%0.75%0.77% Subprime: 1% Wtd Avg LTV*: 88% NCO: 0.00% Prime: 98% Wtd Avg LTV*: 72% NCO: -0.07% Other: 1% Wtd Avg LTV*: 69% NCO: 1.70% *LTV at origination High-quality originations (weighted average FICO on commitments of 768, weighted average CLTV of 69%) originated primarily through the retail branch network to existing bank customers on their primary residences Net charge-offs were stable year-over-year with strong recoveries

Credit Quality – Retail Leasing Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$6,191$7,762$7,982 30-89 Delinquencies0.28%0.31%0.41% 90+ Delinquencies0.02%0.03%0.03% Nonperforming Loans0.03%0.09%0.10% * Manheim Used Vehicle Value Index source: www.manheimconsulting.com, January 1995 = 100, quarter value = average monthly ending values Continued high-quality originations during 4Q17 (weighted average FICO of 782) support the portfolio’s stable credit profile Late Stage Delinquencies, nonperforming leases and net charge-offs remained at very low levels

Credit Quality – Other Retail Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$31,245$32,008$32,856 30-89 Delinquencies0.66%0.75%0.80% 90+ Delinquencies0.13%0.13%0.15% Nonperforming Loans0.09%0.10%0.10% Overall growth continued to be driven by auto loan and installment categories, which were up 6.4% and 11.2% year-over-year, respectively Net charge-offs remained stable; 30-89 delinquencies were seasonally higher on a linked quarter basis

Credit Quality – Auto Loans Average Loans ($mm) and Net Charge-offs Ratio Key Statistics Key Points $mm4Q163Q174Q17 Average Loans$17,624$18,008$18,754 30-89 Delinquencies0.74%0.89%0.95% 90+ Delinquencies0.06%0.08%0.08% Nonperforming Loans0.09%0.11%0.12% Direct: 5% Wtd Avg FICO: 748 NCO: 0.23% Indirect: 95% Wtd Avg FICO: 772 NCO: 0.46% Auto loans are included in Other Retail category Growth driven by high-quality originations in the indirect channel (weighted average FICO 777) Net charge-offs increased seasonally, as expected, on a linked quarter basis

Non-GAAP Financial Measures * 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. (2) Includes net losses on cash flow hedges included in accumulated other comprehensive income (loss) and other adjustments. (3) Includes higher risk-weighting for unfunded loan commitments, investment securities, residential mortgages, mortgage servicing rights and other adjustments. (4) Primarily reflects higher risk-weighting for mortgage servicing rights.

Non-GAAP Financial Measures Utilizes a tax rate of 35 percent for those assets and liabilities whose income or expense is not included for federal income tax purposes. Notable items for the three months ended December 31, 2017 include: $608 million legal and regulatory accrual, $150 million contribution to the U.S. Bank Foundation and $67 million one-time bonus to certain eligible employees. Notable items for the three months ended December 31, 2017 include: $910 million reduction in income tax expense due to tax reform legislation, $608 million legal and regulatory accrual, $105 million (after-tax) contribution to the U.S. Bank Foundation and $47 million (after-tax) one-time bonus to certain eligible employees.

U.S. Bancorp 4Q17 Earnings Conference Call January 17, 2018