U.S. Bancorp

Welcome to U.S. Bancorp's first quarter 2022 earnings conference call. Following a review of the result by Andy Cesare, Chairman, President and Chief Executive Officer, and Terry Dolan, Vice Chairman and Chief Financial Officer, there will be a formal question and answer session. If you would like to ask the question, please press star 1 on your touchtone phone and press the pound key to withdraw. This call will be recorded and available for replay beginning today at approximately 11 a.m. Central Time through Thursday, April 21, 2022 at 10.59 p.m. Central Time. I will now turn the conference call over to Jen Thompson, Head of Corporate Finance and Investor Relations for U.S. Bancorp.

Thank you, Francie, and good morning, everyone. With me today are Andy Cesari, our Chairman, President, and CEO, and Terry Dolan, our Chief Financial Officer. During their prepared remarks, Andy and Terry will be referencing a slide presentation. A copy of the presentation as well as our earnings release and supplemental analyst schedules are available on our website at usbank.com. I'd 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 two 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. Good morning, everyone, and thank you for joining our call. Following our prepared remarks, Terry and I will take any questions you have. I'll begin on slide three. In the first quarter, we reported earnings per share of 99 cents and total revenue of $5.6 billion. The quarter was highlighted by strong loan growth, continued momentum in our payments businesses, well-controlled expenses, and strong credit quality. As expected, mortgage banking revenue declined in the first quarter due to slower refinancing activity in the market. However, we saw good momentum in business activity and related revenue growth within other fee businesses, including payments, trust and investment management, and treasury management. This quarter, we released $50 million in loan loss reserves, reflecting continued strong credit quality. And at March 31st, our CET1 capital ratio was 9.8%. Slide 4 provides key performance metrics. In the first quarter, we delivered a return on assets of 1.09% and a return on tangible common equity of 16.6%. Slide 5 highlights trends in digital engagement. Digital transactions account for over 80% of total transactions, and total digital loan sales account for about two-thirds of total loan sales. We are pleased with the progress we have seen so far, but believe there is further opportunity to increase customer engagement through digital adoption by helping consumers and business customers understand the full scope of capabilities available to a system in managing their financial lives. We are continually adding and enhancing digital features and functionality and applying a digital plus human approach. A great example of this is our do it together co-browse technology. Through this tool, interactions with our customers, a key driver of engagements, have increased in number and have become more efficient as well as effective. Turning to slide six, we believe our complete payments ecosystem is a competitive advantage for our company. The opportunity to connect our banking customers with our payments products and services and our payments customers with our banking products and services will continue to drive meaningful profit and return differentiation for our company over the next several years. Our small business initiative is just one example of many that we see driving both account growth and deeper relationships. We believe the suite of products we offer to our small business customers will allow us to grow those relationships by 15 to 20 percent and related revenue by 25 to 30 percent over the next few years. We are particularly encouraged by the trends we are seeing in the uptake of our TALIC point-of-sale functionality. which allows small business customers to manage their banking and payments needs in a simple, easy-to-use format that we provide in the form of a dashboard. On the right side of the slide, you can see that the number of new TALA customers increased five-fold in 2021 compared to 2020, and that strong growth trajectory has continued in 2022. Year-to-date, new TALA customers are 1.5 times the full-year 2020 level. Now let me turn the call over to Terry, who will provide more details on the quarter.