Company: USB-PA
Filing Date: 2025-03-05
Form Type: DEF 14A
Source: 0001104659-25-020883
Chunk: 46

Company: US BANCORP \DE\
Filing Date: 2025-03-05
Form: DEF 14A
Chunk 46
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 respect to the loan loss reserve that is often dependent upon a number of judgmental factors and economic assumptions. In an effort to measure performance based on actual credit losses, the company excludes changes in the allowance driven by these factors and includes net charge-offs in the determination. For 2024, this calculation resulted in a downward adjustment to our reported EPS of $0.15. It has also been the Committee’s practice to adjust for notable items that are unusual or related to acquisitions. In 2024, the EPS result was adjusted upward by $0.19 to exclude the impact of merger and integration charges related to the MUFG Union Bank acquisition, FDIC special assessment charges and charges related to lease impairments and operational efficiency actions. The Committee adjustments resulted in a total Corporate Result EPS of $3.83.

| ​ | 46 | ​ | ​ | U.S. Bancorp 2025 Proxy Statement | ​ |

TABLE OF CONTENTS Compensation discussion and analysis

2024 Business Line Results: The Business Line Result was calculated as follows: ▶ Pre-tax income targets are established at the beginning of the year for each of our company’s more than 15 revenue-producing business lines in support of our Corporate EPS target. ▶ For 2024, pretax income results, inclusive of the regular adjustments relating to loan loss reserves and CECL described above and adjustments for certain notable items, ranged from 99.9% to 107.9% of target performance across our company’s more than 15 revenue-producing business lines. ▶ These results generated Business Line Results of 99.9% for Payment Services,105.3% for Consumer and Business Banking, and 107.9% for Wealth, Corporate, Commercial and Institutional Banking following application of the leverage factor and the 0% floor and 200% ceiling. ▶ The weighted average Business Line Result of all business lines was 104%. For purposes of computing the Formulaic Bonus Funding Percentage for the Business Line Result, pretax income includes a component for changes in the loan loss reserve driven by loan balances and changes in loan portfolio credit quality. The Committee adjusts these results so that the effect of any variation in our loan loss reserve build or release driven by such changes in loan portfolio credit quality is reduced by 50%. The Committee believes that this adjustment serves to align bonus funding with changes in credit quality while reducing some of the volatility caused by variable judgmental factors. The Committee applies these adjustments for loan loss reserve variation consistently, whether the ultimate impact is positive or negative,