New York, May 02, 2012 -- The following release represents Moody's Investors Service's summary credit
opinion on U.S. Bancorp and includes certain regulatory
disclosures regarding its ratings. This release does not constitute
any change in Moody's ratings or rating rationale for U.S.
Bancorp and its affiliates.
Moody's current ratings on U.S. Bancorp and its affiliates
are:
Long Term Issuer rating of Aa3
Senior Unsecured (domestic currency) ratings of Aa3
Senior Unsecured MTN Program (domestic currency) ratings of (P)Aa3
Subordinate MTN Program (domestic currency) ratings of (P)A1
Junior Subordinate (domestic currency) ratings of A2 (hyb)
Preferred Stock (domestic currency) ratings of A3 (hyb)
Preferred Stock Non-cumulative (domestic currency) ratings of A3
(hyb)
Senior Unsecured Shelf (domestic currency) ratings of (P)Aa3
Subordinate Shelf (domestic currency) ratings of (P)A1
Junior Subordinate Shelf (domestic currency) ratings of (P)A2
Preferred Shelf (domestic currency) ratings of (P)A2
Preferred shelf -- PS2 (domestic currency) ratings of (P)A3
Commercial Paper (domestic currency) ratings of P-1
BACKED Senior Unsecured (domestic currency) ratings of Aaa
U.S. Bank National Association ND
Long Term Issuer rating of Aa2
Long Term Bank Deposits (domestic currency) ratings of Aa2
Long Term Other Senior Obligations ratings of Aa2
Bank Financial Strength ratings of B+
Short Term Bank Deposits (domestic currency) ratings of P-1
Short Term Other Senior Obligations ratings of P-1
U.S. Bank National Association
Long Term Issuer rating of Aa2
Senior Unsecured (domestic currency) ratings of Aa2
Senior Unsecured Bank Note Program (domestic currency) ratings of (P)Aa2
Long Term Bank Deposits (domestic currency) ratings of Aa2
Long Term Other Senior Obligations ratings of Aa2
Bank Financial Strength ratings of B+
Subordinate Bank Note Program (domestic currency) ratings of (P)Aa3
Subordinate (domestic currency) ratings of Aa3
Subordinate (foreign currency) ratings of Aa3
Commercial Paper (domestic currency) ratings of P-1
Short Term Bank Note Program (domestic currency) ratings of (P)P-1
Short Term Bank Deposits (domestic currency) ratings of P-1
Short Term Other Senior Obligations ratings of P-1
Firstar Realty LLC
Preferred Stock Non-cumulative (domestic currency) ratings of A2
USB Capital IX
Preferred Stock (domestic currency) ratings of A3 (hyb)
USB Capital XI
BACKED Preferred Stock (domestic currency) ratings of A2 (hyb)
USB Capital XII
BACKED Preferred Stock (domestic currency) ratings of A2 (hyb)
USB Capital XIII
BACKED Preferred Stock (domestic currency) ratings of A2 (hyb)
USB Realty Corp.
Preferred Stock Non-cumulative (domestic currency) ratings of A3
(hyb)
RATING RATIONALE
We rate U.S. Bank National Association B+ for bank
financial strength (BFSR) and Aa2 for long-term deposits.
The holding company, U.S. Bancorp (USB), is
rated Aa3 for senior debt. These ratings reflect the diversity
of USB's businesses and its excellent operating efficiency,
which result in strong and predictable financial performance. Unlike
many US regional banks, USB was profitable throughout the recent
economic crisis and its credit costs, while elevated, were
manageable. Moreover, its capital and liquidity are healthy.
Despite USB's franchise strengths, our rating outlook remains
negative because the hurdle to a stable outlook at the top end of our
rating scale is challenging and the economic environment continues to
be unsettled. Nonetheless, if USB were to be downgraded,
for example in a more severe economic environment, we believe it
would remain a comparatively highly rated institution.
Rating Outlook
The rating outlook is negative, reflecting the fact that economic
headwinds have not been eliminated. In addition, the hurdle
to a stable outlook at the upper end of our rating scale is very challenging.
What Could Change the Rating - Up
Given our negative rating outlook, future upward rating pressure
is not likely.
What Could Change the Rating - Down
Downward rating pressure would result from credit costs that materially
weaken USB's earnings profile and/or from an extended period of more modest
core earnings. A sizable acquisition, even if conservatively
structured, could also result in negative rating pressure.
For the latest earnings results and developments, please see Moody's
most recent earnings commentary related to USB.
The methodologies used in these ratings were Bank Financial Strength Ratings:
Global Methodology published in February 2007, and Incorporation
of Joint-Default Analysis into Moody's Bank Ratings: Global
Methodology published in March 2012. Please see the Credit Policy
page on www.moodys.com for a copy of these methodologies.
REGULATORY DISCLOSURES
The Global Scale Credit Ratings on this press release that are issued
by one of Moody's affiliates outside the EU are endorsed by Moody's
Investors Service Ltd., One Canada Square, Canary Wharf,
London E 14 5FA, UK, in accordance with Art.4 paragraph
3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies.
Further information on the EU endorsement status and on the Moody's
office that has issued a particular Credit Rating is available on www.moodys.com.
For ratings issued on a program, series or category/class of debt,
this announcement provides relevant regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides relevant regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support provider's credit rating. For provisional ratings,
this announcement provides relevant regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
Information sources used to prepare each of the ratings are the following:
parties involved in the ratings, public information, and confidential
and proprietary Moody's Investors Service information.
Moody's considers the quality of information available on the rated
entities, obligations or credits satisfactory for the purposes of
issuing these ratings.
Moody's adopts all necessary measures so that the information it
uses in assigning the ratings is of sufficient quality and from sources
Moody's considers to be reliable including, when appropriate,
independent third-party sources. However, Moody's
is not an auditor and cannot in every instance independently verify or
validate information received in the rating process.
Please see the ratings disclosure page on www.moodys.com
for general disclosure on potential conflicts of interests.
Please see the ratings disclosure page on www.moodys.com
for information on (A) MCO's major shareholders (above 5%)
and for (B) further information regarding certain affiliations that may
exist between directors of MCO and rated entities as well as (C) the names
of entities that hold ratings from MIS that have also publicly reported
to the SEC an ownership interest in MCO of more than 5%.
A member of the board of directors of this rated entity may also be a
member of the board of directors of a shareholder of Moody's Corporation;
however, Moody's has not independently verified this matter.
Please see Moody's Rating Symbols and Definitions on the Rating
Process page on www.moodys.com for further information on
the meaning of each rating category and the definition of default and
recovery.
Please see ratings tab on the issuer/entity page on www.moodys.com
for the last rating action and the rating history. The date on
which some ratings were first released goes back to a time before Moody's
ratings were fully digitized and accurate data may not be available.
Consequently, Moody's provides a date that it believes is
the most reliable and accurate based on the information that is available
to it. Please see the ratings disclosure page on our website www.moodys.com
for further information.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has
issued the rating.
Allen H. Tischler
Senior Vice President
Financial Institutions Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Robert Franklyn Young
MD - Financial Institutions
Financial Institutions Group
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Moody's Disclosures on Credit Rating of U.S. Bancorp