U.S. Bancorp And U.S. Bank N.A. Nondeferrable Subordinated Debt Ratings Lowered

NEW YORK (Standard&Poor's) Dec. 4, 2015--Standard&Poor's Ratings Services today lowered the nondeferrable subordinated debt (NDSD) rating on U.S. Bank N.A. to 'A' from 'A+' and the NDSD rating on its nonoperating holding company (NOHC), U.S. Bancorp, to 'A-' from 'A'. At the same time, we removed the ratings from CreditWatch, where we placed them on Nov. 3 with negative implications. This rating action follows the conclusion of our review of government support for U.S. banks, which also included a review of our treatment of banks' NDSD (see "U.S. Global Systemically Important Bank Holding Companies Downgraded Based On Uncertain Likelihood Of Government Support," published Dec. 2, 2015, on RatingsDirect). We have decided to treat NDSD as a

...NEW YORK (Standard & Poor's) Dec. 4, 2015--Standard & Poor's Ratings Services today lowered the nondeferrable subordinated debt (NDSD) rating on U.S. Bank N.A. to 'A' from 'A+' and the NDSD rating on its nonoperating holding company (NOHC), U.S. Bancorp, to 'A-' from 'A'. At the same time, we removed the ratings from CreditWatch, where we placed them on Nov. 3 with negative implications. This rating action follows the conclusion of our review of government support for U.S. banks, which also included a review of our treatment of banks' NDSD (see "U.S. Global Systemically Important Bank Holding Companies Downgraded Based On Uncertain Likelihood Of Government Support," published Dec. 2, 2015, on RatingsDirect). We have decided to treat NDSD as a hybrid instrument based on an analysis of the legal provisions of NDSD in the U.S., combined with a more strict interpretation of the potential consequences of these provisions. Specifically, we believe NDSD holders' inability to accelerate the principal...

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