NEW YORK (Standard&Poor's) Oct. 21, 2009--Standard&Poor's Ratings Services said today that U.S. Bancorp's (USB; A+/Stable/A-1) good third-quarter earnings report does not affect the ratings. USB's earnings continued to outperform the industry, a trend we expect to continue. Declining funding costs--the result of very strong organic deposit growth (16% year on year)--and continued stability in noninterest income supported revenues. The latter includes a diminution of write-offs in the auto leasing portfolio and still-strong mortgage-banking revenues. Loan deterioration in the consumer portfolio is slowing, so reserve building was somewhat lower as well. We expect consumer losses to continue to grow through mid-2010, albeit at a slower pace. Commercial real estate and corporate loans are deteriorating more rapidly--a negative
