Company: USB-PA
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0000036104-25-000064
Chunk: 27

Company: US BANCORP \DE\
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 7
Chunk 27
---
inquencies and the impact of economic deterioration on selected borrowers’ liquidity and ability to repay.The ratio of the allowance for credit losses to period-end loans was 2.06 percent at September 30, 2025, compared with 2.09 percent at December 31, 2024. The ratio of the allowance for credit losses to nonperforming loans was 490 percent at September 30, 2025, compared with 442 percent at December 31, 2024. The ratio of the allowance for credit losses to annualized loan net charge-offs was 371 percent at September 30, 2025, compared with 368 percent of full year 2024 net charge-offs at December 31, 2024.The allowance for credit losses related to commercial lending segment loans decreased $98 million during the first nine months of 2025, reflecting improved credit quality and portfolio mix, partially offset by commercial loan growth and increased economic uncertainty. The allowance for credit losses related to consumer lending segment loans increased $70 million during the first nine months of 2025, primarily driven by loan growth and the impacts of economic uncertainty, partially offset by the impact of loan sales during the second quarter of 2025. Economic conditions considered in estimating the allowance for credit losses at September 30, 2025 included changes in projected gross domestic product and unemployment levels. These factors were evaluated through a combination of quantitative calculations using multiple economic scenarios and additional qualitative assessments that considered the degree of economic uncertainty in the current environment. The projected unemployment rates considered in the estimate ranged from 3.6 percent to 9.4 percent, with a peak weighted average unemployment rate of 5.9 percent. 

The following table summarizes the baseline forecast for key economic variables the Company used in its estimate of the allowance for credit losses at September 30, 2025 and December 31, 2024: 

September 30,2025December 31,2024United States unemployment rate for the three months ending(a)September 30, 20254.3 %4.4 %December 31, 20254.5 4.3 September 30, 20264.4 4.4 United States real gross domestic product for the three months ending(b)September 30, 20251.3 %1.7 %December 31, 2025.9 1.7 September 30, 20261.6 2.1 

(a)