10-QPeriod: Q2 FY2016

US BANCORP \DE\ Quarterly Report for Q2 Ended Jun 30, 2016

Filed August 5, 2016For Securities:USBUSB-PHUSB-PPUSB-PRUSB-PQUSB-PSUSB-PA

Summary

U.S. Bancorp's second quarter 2016 filing highlights a stable financial performance with a robust Ratio of Earnings to Fixed Charges, both when excluding and including interest on deposits. The company reported net income of $1.522 billion for the quarter, contributing to a year-to-date net income of $2.908 billion. Fixed charges, including interest on deposits, totaled $435 million for the quarter, indicating strong coverage ratios. A notable addition to the risk factors concerns the United Kingdom's potential withdrawal from the European Union (Brexit). Management acknowledges the uncertainty surrounding Brexit and its potential adverse effects on the company's businesses, financial condition, liquidity, and capital. This includes potential impacts on European operations, revenue, expenses, and employee mobility.

Financial Highlights

34 data points
Beta

Revenue

$5.45B

Net Income

$1.52B

27.9% Net Margin

EPS (Diluted)

$0.83

Total Assets

$438.46B

Free Cash Flow

$1.42B

Financial Statements
Beta
Revenue$5.45B
Interest Expense$407.00M
Net Income$1.52B
EPS (Basic)$0.83
EPS (Diluted)$0.83
Shares Outstanding (Basic)1.73B
Shares Outstanding (Diluted)1.73B

Key Highlights

  • 1Net income attributable to U.S. Bancorp was $1.522 billion for the three months ended June 30, 2016.
  • 2Year-to-date net income attributable to U.S. Bancorp reached $2.908 billion.
  • 3The Ratio of Earnings to Fixed Charges (excluding interest on deposits) stood at a strong 8.29 for the quarter.
  • 4The Ratio of Earnings to Fixed Charges (including interest on deposits) was 5.74 for the quarter.
  • 5A new risk factor has been added detailing the potential adverse effects of the United Kingdom's "Brexit" vote on the company's operations and financial performance.
  • 6The company reported that the risks disclosed in its 2015 10-K have not materially changed, aside from the Brexit-related disclosure.

Frequently Asked Questions

U.S. Bancorp demonstrates strong financial health. For the three months ended June 30, 2016, the ratio of earnings to fixed charges, even when including interest on deposits, was 5.74, and excluding interest on deposits, it was a robust 8.29. This indicates the company generates significantly more earnings than are needed to cover its fixed obligations.

A new risk factor has been added concerning the United Kingdom's vote to leave the European Union (Brexit). The company acknowledges the uncertainty surrounding Brexit and its potential to adversely affect its businesses, financial results, liquidity, and capital through market volatility, economic deterioration, and operational adjustments in Europe.

The filing states that the risks identified in the company's 2015 Annual Report on Form 10-K have not changed in any material respect, with the exception of the newly added Brexit-related risk factor.

For the three months ended June 30, 2016, U.S. Bancorp reported net income attributable to the company of $1.522 billion. For the six months ended June 30, 2016, the net income was $2.908 billion.