US Bancorp Receives 2.5% Stress Capital Reserve Requirement; recommends a 9.5% dividend increase | Business

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MINNEAPOLIS – (BUSINESS WIRE) – June 28, 2021–

US Bancorp (NYSE: USB) today commented on the results of the US Federal Reserve’s Dodd-Frank 2021 stress test.

Based on the results of its 2021 stress tests, the company will be subject to a 2.5% capital buffer (SCB) requirement for the period starting October 1, 2021 and ending September 30, 2022. The SCB, when added to Basel III Common Equity Tier 1 (CET1) of 4.5% minimum, requires the company to maintain a CET1 ratio above 7% during this period. The company’s CET1 ratio was 9.9% as of March 31, 2021 under CECL transition rules.

The Federal Reserve also announced that capital restrictions instituted in the third quarter of 2020 in response to the economic uncertainty of the COVID-19 pandemic will expire on June 30, 2021. Accordingly, the company will recommend to its board of directors to approve a 9.5% increase in its third quarter dividend payable in October 2021. The company expects to recommend a dividend of $ 0.46 per common share in the third quarter, which equates to an annual dividend of $ 1.84 per common share.

The existing US Bancorp share buyback program announced in December 2020 remains in effect. The company will continue to monitor its capital position and may revise the program based on economic conditions and performance. Distributions of capital, including dividends and share repurchases, are subject to the approval of the Board of Directors of the Company and will comply with regulatory requirements.

“We are committed to creating and delivering value to our shareholders and we continue to do so every day,” said Andy Cecere, Chairman, President and CEO of US Bancorp. “This year’s stress test results are a testament to our strong profile and well-established financial discipline which has enabled us to maintain strong capital and liquidity positions through recent adverse economic conditions.

About the American Bank

US Bancorp, with nearly 70,000 employees and $ 553 billion in assets as of March 31, 2021, is the parent company of the US Bank National Association. The Minneapolis-based company serves millions of customers locally, nationally and globally through a diverse mix of businesses: Personal and business banking; Payment services; Banking services for businesses and businesses; and Wealth and Investment Management Services. The company has been recognized for its approach to digital innovation, social responsibility and customer service, including being named one of the world’s most ethical companies in 2021 and Fortune’s most admired super-regional bank. Learn more at usbank.com/about.

Forward-looking statements

Safe Harbor Declaration under the Private Securities Litigation Reform Act of 1995:

This press release contains forward-looking statements regarding US Bancorp. Statements that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements and are based on available information, assumptions and estimates made by management. as of the date hereof. The forward-looking statements contained in this press release include the anticipated distributions of capital by US Bancorp in the form of dividends and share repurchases. There can be no assurance that US Bancorp will return such capital or any other amount to its shareholders in the form of dividends or share repurchases in the future.

Forward-looking statements involve inherent risks and uncertainties, and important factors could cause actual results to differ materially from those anticipated. The COVID-19 pandemic is negatively affecting US Bancorp, its customers, counterparties, employees and third party service providers, and the ultimate extent of impacts on its business, financial condition, results of operations, liquidity and its outlook is uncertain. Continued deterioration in general business and economic conditions or turbulence in domestic or global financial markets could adversely affect US Bancorp’s revenues and the value of its assets and liabilities, reduce the availability of funding for certain financial institutions, cause a credit crunch and increase stock price volatility. In addition, changes in laws, regulations or regulatory policies or practices could affect US Bancorp in a material and unforeseeable manner. US Bancorp’s results could also be affected by changes in interest rates; further increases in unemployment rates; deterioration in the credit quality of its loan portfolios or in the value of the collateral securing these loans; deterioration in the value of its investment securities; legal and regulatory developments; litigation; increased competition from banks and non-banks; civil unrest; changes in customer behavior and preferences; data security breaches; breaches of the protection of personal information; effects of mergers and acquisitions and related integration; the effects of accounting policies and critical 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 a discussion of these and other risks that could cause actual results to differ from expectations, see US Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the Securities and Exchange Commission, including the “Company Risk Profile” and “Risk Factors” sections 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 In addition, factors other than these risks could also adversely affect US Bancorp’s results, and the reader should not regard these risks as a full set of all potential risks or uncertainties. Forward-looking statements speak only as of the date hereof, and US Bancorp assumes no obligation to update them in light of new information or future events.

See the source version on businesswire.com: https://www.businesswire.com/news/home/20210628005819/en/

CONTACT: Investors: Jennifer Thompson, US Bancorp Investor Relations

612.303.0778, jen.thompson @ usbank.com

Media: Jeff Shelman, US Bancorp Public Affairs and Communications

612.422.1423, [email protected]

KEYWORD: UNITED STATES NORTH AMERICA MINNESOTA

INDUSTRY KEYWORD: FINANCING OF PROFESSIONAL BANKING SERVICES

SOURCE: Bancorp in the United States

Copyright Business Wire 2021.

PUB: 06/28/2021 5:10 PM / DISC: 06/28/2021 5:12 PM

http://www.businesswire.com/news/home/20210628005819/en

Copyright Business Wire 2021.



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