U.S. Bancorp

Welcome to U.S. Bancorp's first quarter 2020 earnings conference call. Following a review of the results by Andy Cesari, Chairman, President, and Chief Executive Officer, and Terry Dolan, U.S. Bancorp's Vice Chairman and Chief Financial Officer, there will be a formal question and answer session. If you would like to ask a question, please press star 1 on your touch-tone phone and press the pound key to withdraw. This call will be recorded. and available for replay beginning today at approximately 12 o'clock p.m. Eastern Time through Wednesday, April 22nd at 12 o'clock midnight Eastern Time. I will now turn the conference call over to Jen Thompson, Director of Investor Relations for U.S. Bancorp.

Thank you, Janika, and good morning, everyone. With me today, as usual, are Andy Cesari, our Chairman, President, and CEO, and Terry Dolan, our Chief Financial Officer. Also joining us on the call today are our Chief Risk Officer, Jody Richard, and our Chief Credit Officer, Mark Runkle. During their prepared remarks, Andy and Terry will be referencing a slide presentation. A copy of the slide presentation, as well as our earnings release and supplemental analyst schedules, are available on our website at usbank.com. I would like to remind you that any forward-looking statements made during today's call are subject to risk and uncertainty. Factors that could materially change our current forward-looking assumptions are described on page 2 of today's presentation, in our press release, and in our Form 10-K and subsequent reports on file with the SEC. I'll now turn the call over to Andy.

Thanks, Jen, and good morning, everyone, and thank you for joining our call. After Terry and I finish our prepared remarks, Terry, Jody, Mark, and I will take any questions you have. I'll begin on slide 3. In the first quarter, we reported earnings per share of 72 cents. Our performance this quarter was adversely impacted by the COVID-19 in the U.S. and global economies. The stay-at-home orders across the country, while necessary and temporary, are significantly restricting economic activity. Consumers and businesses are dealing with the fallout, which is affecting sentiment and business activity and resulting in financial distress for many. These dynamics are affecting the banking industry in a number of ways, and our first quarter results were reflective of these developing economic conditions. We saw strong loan growth and related deposit growth, particularly in the last few weeks of the quarter, as we supported our customers' liquidity needs. During this timeframe, the company funded approximately $22 billion of loans for our customers while continuing to strengthen our cash position. Our fee businesses were affected to varying degrees. Our payments businesses were negatively impacted by a sharp decline in both consumer and commercial spend activity, in line with the drop in global economic activity in March. Demonstrating the importance of having a well-diversified business mix, mortgage revenue growth was strong this quarter, as the decline in interest rates allowed many more consumers to refinance their mortgage at more attractive terms. We also saw strong growth in our commercial products revenue, reflecting robust capital markets activity. Non-performing assets started to trend higher in the first quarter, reflecting the increased economic stress. We increased our allowance for loan losses in response to the current economic conditions, and as you can see in the lower right quadrant of this slide, we remain well capitalized. Book value per share grew 5% compared with a year ago. Slide 4 provides key performance metrics. We delivered a 12.6 return on tangible common equity in the first quarter. impacted by lower earnings due to the current economic environment. Slide five shows our continually improving digital update trends. The significant investments we've made in our digital capabilities over the last several years are helping our customers continue to do banking as social distancing has become more widespread. Because of our agile development activities, we've made a number of updates in recent weeks to digital tools and processes to help customers who choose to bank at home. We've added the ability to accept treasury checks via mobile check deposit, which will help customers more quickly and seamlessly get access to funds being distributed through the government stimulus efforts. Our teams work quickly to design and deploy a new digital forbearance tool. Within a week of this feature being launched, more than 50% of all customers requesting forbearance were doing so in a digital way. Digital is a core part of our strategy and we'll continue to look for innovative ways to help our customers bank from home and to meet financial goals through the social distancing period and beyond. Now I'll turn the call over to Terry who will provide more color on the quarter. Terry?