U.S. Bancorp

Positively, USB's noninterest income was roughly 40% of revenue in the nine months ended Sept. 30, 2024, which compares favorably with regional bank peers. In addition, we think profitability and deposit retention performed generally better than industry medians in recent quarters. Furthermore, USB's stress capital buffer rose significantly in the Fed's 2024 Dodd-Frank Act Stress Test, which we view somewhat negatively given comparisons to certain similarly rated peers. However, its loan loss reserves are meaningful, in our view. The stable outlook on USB and its operating subsidiaries reflects our expectation that despite some deposit, net interest margin, and asset quality pressures, the company will continue to perform better than most regional bank peers. We expect the company to generate solid

...We expect U.S. Bancorp (USB) to continue to perform well despite economic and interest rate concerns. USB remains our highest rated regional bank, largely due to its strong market position and conservative business and financial policies. We think USB's acquisition of MUFG Union Bank (MUB), completed in December 2022, boosted its market position but also increased its loan concentrations in California. Positively, USB's noninterest income was roughly 40% of revenue in the nine months ended Sept. 30, 2024, which compares favorably with regional bank peers. In addition, we think profitability and deposit retention performed generally better than industry medians in recent quarters. However, USB's risk-weighted capital ratios are rising, but they would be among the lowest of large regional bank peers if adjusted for sizable unrealized losses in its securities portfolios. USB's risk-adjusted capital ratio was 8.2% as of June...

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