U.S. Bancorp reported net income of $1.35 billion for the fourth quarter of 2011, 38.6% higher than the $974 million for the fourth quarter of 2010 and 6.0% higher than the $1,273 million for the third quarter of 2011. Net income of $4.9 billion was reported for the full year 2011, 46.9% higher than the $3.3 billion in 2010.
Strong new lending activity of $70.0 billion (17.6% increase on a linked quarter basis) was reported during the fourth quarter, including $21.5 billion of new commercial and commercial real estate commitments.
U.S. Bancorp Chairman, President and Chief Executive Officer Richard K. Davis said, “Earnings for the quarter and 2011 were driven by record revenue, reduced credit costs and our on-going dedication to operating efficiency.”
Lease financing declined 4.5% to $5.9 billion in 2011, down from $6.2 billion reported in 2010.
Return on average assets and return on average common equity were 1.62% and 16.8%, respectively, for the fourth quarter of 2011, compared with 1.31% and 13.7%, respectively, for the fourth quarter of 2010.
U.S. Bancorp Chairman, President and Chief Executive Officer Richard K. Davis said, “Fourth quarter return on average assets of 1.62 % and return on average common equity of 16.8 % are industry leading, and were achieved despite the continuing headwinds of the slow recovery and elevated credit and regulatory costs."
Net charge-offs and nonperforming assets declined on a linked quarter basis. Provision for credit losses was $125 million less than net charge-offs. Net charge-offs declined 7.0% from the third quarter of 2011.
Nonperforming assets (excluding covered assets) decreased 15.2% from the third quarter of 2011 (13.0% including covered assets).
“Credit quality continued to improve this quarter, with both net charge-offs and nonperforming assets lower than the prior quarter. We expect that nonperforming assets will decline in the coming quarter as the economy slowly improves. Net charge-offs, at 1.19% of average loans outstanding in the fourth quarter, will also continue to improve over time, but at a slower pace, as we approach our predicted “through the cycle” net charge-off ratio of 1.0%,” said Davis.