We believe that U.S. Bancorp's earnings will deteriorate given the increasing credit risks confronting the banking system as a whole. We are placing our rating on U.S. Bancorp on CreditWatch Negative. We could lower the rating by one notch or more, or affirm the rating with a stable or negative outlook. On May 4, 2009, Standard&Poor's Ratings Services placed its 'AA/A-1+' counterparty credit rating on U.S. Bancorp, as well as its 'AA+' long-term counterparty credit rating on related entities on CreditWatch Negative. Our 'A-1+'short-term counterparty credit ratings on subsidiary banks are not on CreditWatch. The CreditWatch placement is part of an ongoing industry review and follows our recent criteria on stress testing and U.S. banks (see "Credit Stress
