Company: USB-PA
Filing Date: 2025-03-05
Form Type: DEF 14A
Source: 0001104659-25-020883
Chunk: 40

Company: US BANCORP \DE\
Filing Date: 2025-03-05
Form: DEF 14A
Chunk 40
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 corporate achievement; and ▶ encourages an appropriate sensitivity to risk on the part of senior management, which protects long-term shareholder interests. Pay for performance We operate in a highly complex business environment and compete with both well-established financial institutions and also with non-banks. Our long-term business objective is to maximize shareholder value by consistently delivering superior returns on common equity that exceed the cost of equity. If we are successful in achieving this objective, the Committee believes the results will benefit our shareholders. Accordingly, our executive compensation program is designed to reward our executives for achieving annual and long-term financial results that further our long-term business objectives. ▶ The annual cash incentive plan rewards performance relative to corporate EPS and business line pretax income targets established at the beginning of the fiscal year, with consideration of qualitative factors to support alignment with additional corporate priorities. ▶ For PRSUs granted between 2022 and 2024, NEOs earn PRSUs based on achievement of absolute and relative ROE targets over a three-year performance period, which directly measure the return generated by the company on shareholders’ investment. ▶ For PRSUs granted in 2025, NEOs earn PRSUs based on achievement of absolute and relative ROTCE targets over a three-year performance period, which measures profitability and efficiency, and a TSR modifier based on our cumulative three-year performance relative to our financial performance peer group to further align the interests of our executives with the long-term interests of our shareholders. ▶ The ultimate value of both the PRSUs and RSUs earned depends on our long-term financial success, as reflected in the price of our common stock. At the same time, the Committee carefully weighs the risks inherent in our executive compensation program against the program’s goals and the company’s risk appetite. Additional discussion of the risk oversight undertaken by the Committee can be found below under “Decision making and policies — Risk considerations.” Pay levels When determining executive compensation levels each year, the Committee considers the value of each compensation element as well as the value of the total direct compensation package. Key factors that inform pay levels include the following: ▶ a review of market data and the competitive landscape, which includes our complexity and size relative to our peer institutions and the comparability of our NEOs’ responsibilities to similar roles at peer institutions; ▶ the performance, experience and expertise of the executive, including expanded scope of responsibilities when applicable; ▶ internal pay equity within the executive officer group; ▶ the company’s strategy and performance; ▶ the company’s and each individual executive’s