OVERVIEW

Earnings Summary U.S. Bancorp and its subsidiaries (the “Company”) reported net income attributable to U.S. Bancorp of $1.4 billion for the first quarter of 2014, or $.73 per diluted common share, both equal to the first quarter of 2013. Return on average assets and return on average common equity were 1.56 percent and 14.6 percent, respectively, for the first quarter of 2014, compared with 1.65 percent and 16.0 percent, respectively, for the first quarter of 2013.

Total net revenue, on a taxable-equivalent basis, for the first quarter of 2014 was $60 million (1.2 percent) lower than the first quarter of 2013, primarily reflecting a 2.6 percent decrease in noninterest income. Net interest income was essentially flat from a year ago, the result of an increase in average earning assets, offset by a decrease in the net interest margin. The noninterest income decrease was due to lower mortgage banking revenue.

Noninterest expense in the first quarter of 2014 was $74 million (3.0 percent) higher than the first quarter of 2013, primarily due to an increase in other expense driven by insurance-related recoveries in the first quarter of 2013, partially offset by a decrease in costs related to foreclosed properties, and the Company’s adoption in the first quarter of 2014 of new accounting guidance for certain affordable housing tax credit investments.

The provision for credit losses for the first quarter of 2014 of $306 million was $97 million (24.1 percent) lower than the first quarter of 2013. Net charge-offs in the first quarter of 2014 were $341 million, compared with $433 million in the first quarter of 2013. Refer to “Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.

STATEMENT OF INCOME ANALYSIS

Net Interest Income Net interest income, on a taxable-equivalent basis, was $2.7 billion in the first quarter of 2014, essentially flat to the first quarter of 2013, the result of a lower net interest margin, offset by higher average earning assets. The net interest margin in the first quarter of 2014 was 3.35 percent, compared with 3.48 percent in the first quarter of 2013. The decrease in the net interest margin from the first quarter of 2013 primarily reflected lower reinvestment rates on investment securities, as well as growth in the investment portfolio at lower average rates, and lower rates on loans, partially offset by lower rates on deposits and short-term borrowings, and the positive impact from maturities of higher rate long-term debt. Average earning assets were $12.2 billion (3.9 percent) higher in the first quarter of 2014, compared with the first quarter of 2013, driven by increases of $13.4 billion (6.0 percent) in loans and $8.7 billion (11.9 percent) in investment securities, partially offset by decreases in loans held for sale of $6.1 billion (70.0 percent) and other earning assets of $3.8 billion (40.8 percent), primarily due to the deconsolidation of certain consolidated variable interest entities during the second quarter of 2013. Refer to the “Consolidated Daily Average Balance Sheet and Related Yields and Rates” table for further information on net interest income.

Average total loans for the first quarter of 2014 were $13.4 billion (6.0 percent) higher than the first quarter of 2013, driven by growth in residential mortgages (14.4 percent), commercial loans (8.5 percent), commercial real estate loans (7.6 percent), credit card loans (5.3 percent) and other retail loans (.9 percent). These increases were driven by higher demand for loans from new and existing customers. The increases were partially offset by a decline in loans covered by loss sharing agreements with the Federal Deposit Insurance Corporation (“FDIC”) (24.4 percent). Average loans acquired in FDIC-assisted transactions that are covered by loss sharing agreements with the FDIC (“covered” loans) were $8.3 billion in the first quarter of 2014, compared with $11.0 billion in the same period of 2013.

Average investment securities in the first quarter of 2014 were $8.7 billion (11.9 percent) higher than the first quarter of 2013, primarily due to purchases of U.S. government agency-backed securities, net of prepayments and maturities, in anticipation of final liquidity coverage ratio regulatory requirements.

Average total deposits for the first quarter of 2014 were $12.5 billion (5.1 percent) higher than the first quarter of 2013. Average noninterest-bearing deposits increased $4.4 billion (6.7 percent) over the prior year, driven primarily by growth in balances related to the Company’s corporate trust and wholesale businesses. Average total savings deposits were $10.8 billion (8.2 percent) higher, the result of growth in Consumer and Small Business Banking, and Wholesale Banking and Commercial Real Estate balances. Average time deposit less than $100,000 were $2.2 billion (15.9 percent) lower in the first quarter of 2014, compared with the same period of 2013, due to maturities. Average time deposits greater than $100,000 were $636 million (2.0 percent) lower, primarily due to a decline in Consumer and Small Business Banking and corporate trust balances, partially offset by an increase in Wholesale Banking and Commercial Real Estate balances. Time deposits greater than $100,000 are managed as an alternative to other funding sources such as wholesale borrowing, based largely on relative pricing.

Provision for Credit Losses The provision for credit losses for the first quarter of 2014 decreased $97 million (24.1 percent) from the first quarter of 2013. Net charge-offs decreased $92 million (21.2 percent) in the first quarter of 2014, compared with the same period of

the prior year, due to improvements in the commercial real estate, residential mortgages and home equity and second mortgages portfolios. The provision for credit losses was lower than net charge-offs by $35 million in the first quarter of 2014, compared with $30 million lower than net charge-offs in the first quarter of 2013. Refer to “Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.

Noninterest Income Noninterest income in the first quarter of 2014 was $2.1 billion, a decrease of $57 million (2.6 percent), compared with the first quarter of 2013. The decrease from a year ago was due to a reduction in mortgage banking revenue, due to lower origination and sales revenue, partially offset by growth in several other fee categories. Credit and debit card revenue increased primarily due to higher transaction volumes. Merchant processing services revenue was higher as a result of an increase in fee-based product revenue and higher volumes, partially offset by lower rates. Trust and investment management fees increased, reflecting account growth, improved market conditions and business expansion. Commercial products revenue increased, principally due to higher syndication fees on tax-advantaged projects, while investment products fees increased due to higher sales volumes and fees. In addition, other income increased, driven by higher equity investment revenue.

Noninterest Expense Noninterest expense in the first quarter of 2014 was $2.5 billion, an increase of $74 million (3.0 percent), compared with the first quarter of 2013. The increase in noninterest expense from a year ago was the result of higher compensation expense, reflecting growth in staffing for business initiatives and the impact of merit increases, partially offset by a reduction in employee benefits expense driven by lower pension costs, higher net occupancy and equipment expense due to business initiatives, higher rent expense, and the timing of marketing expense in Payment Services. In addition, other expense increased, driven by insurance-related recoveries in the prior year, partially offset by lower tax-advantaged project costs resulting from the first quarter of 2014 adoption of new accounting guidance for certain affordable housing tax credit investments, and lower costs related to foreclosed real estate. Other intangibles expense decreased from the prior year due to the reduction or completion of the amortization of certain intangibles.

Income Tax Expense The provision for income taxes was $496 million (an effective rate of 26.0 percent) for the first quarter of 2014, compared with $558 million (an effective rate of 28.7 percent) for the first quarter of 2013. The decrease from the prior year primarily reflected the impact of the accounting presentation changes, begun in the fourth quarter of 2013, related to certain investments in tax-advantaged projects, net of the impact of the adoption of new accounting guidance for certain affordable housing tax credit investments in the first quarter of 2014. For further information on income taxes, refer to Note 10 of the Notes to Consolidated Financial Statements.

BALANCE SHEET ANALYSIS

Loans The Company’s loan portfolio was $238.4 billion at March 31, 2014, compared with $235.2 billion at December 31, 2013, an increase of $3.2 billion (1.3 percent). The increase was driven primarily by increases in commercial loans, commercial real estate loans and residential mortgages, partially offset by lower credit card, other retail and covered loans.

Commercial loans and commercial real estate loans increased $3.7 billion (5.2 percent) and $246 million (.6 percent), respectively, at March 31, 2014, compared with December 31, 2013, reflecting higher demand from new and existing customers.

Residential mortgages held in the loan portfolio increased $552 million (1.1 percent) at March 31, 2014, compared with December 31, 2013. Residential mortgages originated and placed in the Company’s loan portfolio are primarily well-secured jumbo mortgages and branch-originated first lien home equity loans to borrowers with high credit quality. The Company generally retains portfolio loans through maturity; however, the Company’s intent may change over time based upon various factors such as ongoing asset/liability management activities, assessment of product profitability, credit risk, liquidity needs, and capital implications. If the Company’s intent or ability to hold an existing portfolio loan changes, the loan is transferred to loans held for sale.

Credit card loans decreased $892 million (4.9 percent) at March 31, 2014, compared with December 31, 2013, the result of customers seasonally paying down their balances. Other retail loans, which include retail leasing, home equity and second mortgages and other retail loans, decreased $71 million (.1 percent)

at March 31, 2014, compared with December 31, 2013. The decrease was driven by lower home equity and second mortgages and student loan balances, partially offset by higher auto and installment loans, and retail leasing balances.

Loans Held for Sale Loans held for sale, consisting primarily of residential mortgages to be sold in the secondary market, were $1.8 billion at March 31, 2014, compared with $3.3 billion at December 31, 2013. The decrease in loans held for sale was principally due to a lower amount of mortgage loan originations during the first quarter of 2014, which was the result of less refinance activity.

Almost all of the residential mortgage loans the Company originates or purchases for sale follow guidelines that allow the loans to be sold into existing, highly liquid secondary markets; in particular in government agency transactions and to government-sponsored enterprises (“GSEs”).

Investment Securities Investment securities totaled $85.5 billion at March 31, 2014, compared with $79.9 billion at December 31, 2013. The $5.6 billion (7.0 percent) increase reflected $5.3 billion of net investment purchases, primarily U.S. government agency-backed securities in anticipation of final liquidity coverage ratio regulatory requirements, and a $297 million favorable change in net unrealized gains (losses) on available-for-sale investment securities.

The Company’s available-for-sale securities are carried at fair value with changes in fair value reflected in other comprehensive income (loss) unless a security is deemed to be other-than-temporarily impaired. At March 31, 2014, the Company’s net unrealized gains on available-for-sale securities were $172 million, compared with net unrealized losses of $125 million at December 31, 2013. The favorable change in net unrealized gains (losses) was primarily due to increases in the fair value of agency mortgage-backed and state and political securities as a result of decreases in interest rates and changes in credit spreads. Gross unrealized losses on available-for-sale securities totaled $596 million at March 31, 2014, compared with $775 million at December 31, 2013. At March 31, 2014, the Company had no plans to sell securities with unrealized losses, and believes it is more likely than not that it would not be required to sell such securities before recovery of their amortized cost.

In December 2013, U.S. banking regulators approved final rules that prohibit banks from holding certain types of investments, such as investments in hedge and private equity funds. The Company does not anticipate the implementation of these final rules will require any significant liquidation of securities held or impairment charges. Refer to Notes 2 and 13 in the Notes to Consolidated Financial Statements for further information on investment securities.

Deposits Total deposits were $260.6 billion at March 31, 2014, compared with $262.1 billion at December 31, 2013, the result of decreases in noninterest-bearing deposits and time deposits less than $100,000, partially offset by increases in total savings deposits and time deposits greater than $100,000. Noninterest-bearing deposits decreased $3.6 billion (4.7 percent), primarily due to a seasonal decrease in Wealth Management and Securities Services balances. Time deposits less than $100,000 decreased $652 million (5.5 percent) at March 31, 2014, compared with December 31, 2013, primarily due to maturities. Savings account balances increased $1.6 billion (4.8 percent), primarily due to continued strong participation in a savings product offered by Consumer and Small Business Banking. Money market balances increased $606 million (1.0 percent) primarily due to higher Consumer and Small Business Banking and government banking balances. Interest checking balances increased $247 million (.5 percent) primarily due to higher Consumer and Small Business Banking and Wholesale Banking and Commercial Real Estate balances, partially offset by lower corporate trust and broker-dealer balances. Time deposits greater than $100,000 increased $314 million (1.1 percent) at March 31, 2014, compared with December 31, 2013. Time deposits greater than $100,000 are managed as an alternative to other funding sources such as wholesale borrowing, based largely on relative pricing.

Borrowings The Company utilizes both short-term and long-term borrowings as part of its asset/liability management and funding strategies. Short-term borrowings, which include federal funds purchased, commercial paper, repurchase agreements, borrowings secured by high-grade assets and other short-term borrowings, were $30.8 billion at March 31, 2014, compared with $27.6 billion at December 31, 2013. The $3.2 billion (11.5 percent) increase in short-term borrowings was primarily due to higher federal funds purchased, commercial paper and other short-term borrowings balances, partially offset by lower repurchase agreement balances. Long-term debt was $23.8 billion at March 31, 2014, compared with $20.0 billion at December 31, 2013. The $3.8 billion (18.6 percent) increase was primarily due to the issuances of $3.0 billion of bank notes and $.8 billion of medium-term notes, and a $1.0 billion increase in Federal Home Loan Bank advances, partially offset by $1.0 billion of subordinated note maturities. These increases in borrowings were used to fund the Company’s loan growth and securities purchases. Refer to the “Liquidity Risk Management” section for discussion of liquidity management of the Company.

CORPORATE RISK PROFILE

Overview Managing risks is an essential part of successfully operating a financial services company. The Company’s Board of Directors has approved a risk appetite statement and framework for the Company which defines acceptable levels of risk taking, including risk limits, and establishes the governance and oversight activities over risk management and reporting. Compliance with the risk appetite statement is overseen by the Risk Management Committee of the Company’s Board of Directors and managed by the Executive Risk Committee, which is comprised of senior management and led by the Chief Risk Officer. Within this framework, the Company has established quantitative measurements and qualitative considerations for monitoring risk across the Company.

The Company’s most prominent risk exposures are credit, residual value, operational, interest rate, market, liquidity and reputation risk. Credit risk is the risk of not collecting the interest and/or the principal balance of a loan, investment or derivative contract when it is due. Residual value risk is the potential reduction in the end-of-term value of leased assets. Operational risk includes risks related to fraud, processing errors, technology, breaches of internal controls and in data security, and business continuation and disaster recovery. Operational risk also includes legal and compliance risks, including risks arising from the failure to adhere to laws, rules, regulations and internal policies and procedures. Interest rate risk is the potential reduction of net interest income as a result of changes in interest rates, which can affect the re-pricing of assets and liabilities differently. Market risk arises from fluctuations in interest rates, foreign exchange rates, and security prices that may result in changes in the values of financial instruments, such as trading and available-for-sale securities, mortgage loans held for sale, mortgage servicing rights (“MSRs”) and derivatives that are accounted for on a fair value basis. Liquidity risk is the possible inability to fund obligations to depositors, investors or borrowers. Further, corporate strategic decisions, as well as the risks described above, could give rise to reputation risk. Reputation risk is the risk that negative publicity or press, whether true or not, could result in costly litigation or cause a decline in the Company’s stock value, customer base, funding sources or revenue. In addition to the risks identified above, other risk factors exist that may impact the Company. Refer to “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, for a detailed discussion of these factors.

The Company’s risk management governance approach includes comprehensive board level and management risk committee structures as well as a “three lines of defense” system of checks and balances. Under this system, the first line of defense is responsible for managing the risks it undertakes in accordance with established boundaries such as risk appetite and policy limits. Line of business leaders, along with their Business Line Chief Risk Officers, are responsible for the risk management activities within each business line. The second line of defense, which includes independent risk management and corporate support functions, establishes policies and other requirements and interacts with the Company’s business lines to oversee effective execution. The second line of defense also monitors significant risks on a regular basis, including independent assessments of credit and financial risk processes to ensure the accuracy of loan risk ratings, the quality of underwriting, and to monitor market, interest rate and liquidity risks. The third line of defense, the Company’s internal audit department, engages in independent assessments to provide assurance on the risk management framework.

Under the guidance of the Executive Risk Committee, risk management personnel help promote a culture of compliance through oversight, credible challenge, advice, monitoring, testing and reporting with respect to the Company’s adherence to laws, rules, regulations and internal policies and procedures.

Management provides various risk-related reporting to the Risk Management Committee of the Board of Directors. The Risk Management Committee discusses with management the Company’s risk management performance, covering the status of existing matters, areas of potential future concern, and specific information on certain types of loss events. The discussion also covers quarterly reports by management assessing the Company’s performance relative to the risk appetite statement and the associated risk tolerance limits, including:

Credit Risk Management The Company’s strategy for credit risk management includes well-defined, centralized credit policies, uniform underwriting criteria, and ongoing risk monitoring and review processes for all commercial and consumer credit exposures. In evaluating its credit risk, the Company considers changes, if any, in underwriting activities, the loan portfolio composition (including product mix and geographic, industry or customer-specific concentrations), trends in loan performance, the level of allowance coverage relative to similar banking institutions and macroeconomic factors, such as changes in unemployment rates, gross domestic product and consumer bankruptcy filings. The Risk Management Committee oversees the Company’s credit risk management process.

In addition, credit quality ratings, as defined by the Company, are an important part of the Company’s overall credit risk management and evaluation of its allowance for credit losses. Loans with a pass rating represent those not classified on the Company’s rating scale for problem credits, as minimal risk has been identified. Loans with a special mention or classified rating, including all of the Company’s loans that are 90 days or more past due and still accruing, nonaccrual loans, those considered troubled debt restructurings (“TDRs”), and loans in a junior lien position that are current but are behind a modified or delinquent loan in a first lien position, encompass all loans held by the Company that it considers to have a potential or well-defined weakness that may put full collection of contractual cash flows at risk. The Company’s internal credit quality ratings for consumer loans are primarily based on delinquency and nonperforming status, except for a limited population of larger loans within those portfolios that are individually evaluated. For this limited population, the determination of the internal credit quality rating may also consider collateral value and customer cash flows. The Company obtains recent collateral value estimates for the majority of its residential mortgage and home equity and second mortgage portfolios, which allows the Company to compute estimated loan-to-value (“LTV”) ratios reflecting current market conditions. These individual refreshed LTV ratios are considered in the determination of the appropriate

allowance for credit losses. However, the underwriting criteria the Company employs consider the relevant income and credit characteristics of the borrower, such that the collateral is not the primary source of repayment. Refer to Note 3 in the Notes to Consolidated Financial Statements for further discussion of the Company’s loan portfolios including internal credit quality ratings. In addition, refer to “Management’s Discussion and Analysis — Credit Risk Management” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, for a more detailed discussion on credit risk management processes.

The Company manages its credit risk, in part, through diversification of its loan portfolio and limit setting by product type criteria and concentrations. As part of its normal business activities, the Company offers a broad array of lending products. The Company categorizes its loan portfolio into three segments, which is the level at which it develops and documents a systematic methodology to determine the allowance for credit losses. The Company’s three loan portfolio segments are commercial lending, consumer lending and covered loans. The commercial lending segment includes loans and leases made to small business, middle market, large corporate, commercial real estate, financial institution, non-profit and public sector customers. Key risk characteristics relevant to commercial lending segment loans include the industry and geography of the borrower’s business, purpose of the loan, repayment source, borrower’s debt capacity and financial flexibility, loan covenants, and nature of pledged collateral, if any. These risk characteristics, among others, are considered in determining estimates about the likelihood of default by the borrowers and the severity of loss in the event of default. The Company considers these risk characteristics in assigning internal risk ratings to, or forecasting losses on, these loans which are the significant factors in determining the allowance for credit losses for loans in the commercial lending segment.

The consumer lending segment represents loans and leases made to consumer customers including residential mortgages, credit card loans, and other retail loans such as revolving consumer lines, auto loans and leases, student loans, and home equity loans and lines. Home equity or second mortgage loans are junior lien closed-end accounts fully disbursed at origination. These loans typically are fixed rate loans, secured by residential real estate, with a 10 or 15 year fixed payment amortization schedule. Home equity lines are revolving accounts giving the borrower the ability to draw and repay balances repeatedly, up to a maximum commitment, and are secured by residential real estate. These include accounts in either a first or junior lien position. Typical

terms on home equity lines in the portfolio are variable rates benchmarked to the prime rate, with a 15-year draw period during which a minimum payment is equivalent to the monthly interest, followed by a 10-year amortization period. A 10-year draw and 20-year amortization product was introduced during 2013 to provide customers the option to repay their outstanding balances over a longer period. At March 31, 2014, substantially all of the Company’s home equity lines were in the draw period. Key risk characteristics relevant to consumer lending segment loans primarily relate to the borrowers’ capacity and willingness to repay and include unemployment rates and other economic factors, customer payment history and in some cases, updated LTV information on real estate based loans. These risk characteristics, among others, are reflected in forecasts of delinquency levels, bankruptcies and losses which are the primary factors in determining the allowance for credit losses for the consumer lending segment.

The covered loan segment represents loans acquired in FDIC-assisted transactions that are covered by loss sharing agreements with the FDIC that greatly reduce the risk of future credit losses to the Company. Key risk characteristics for covered segment loans are consistent with the segment they would otherwise be included in had the loss share coverage not been in place, but consider the indemnification provided by the FDIC.

The Company further disaggregates its loan portfolio segments into various classes based on their underlying risk characteristics. The two classes within the commercial lending segment are commercial loans and commercial real estate loans. The three classes within the consumer lending segment are residential mortgages, credit card loans and other retail loans. The covered loan segment consists of only one class.

The Company’s consumer lending segment utilizes several distinct business processes and channels to originate consumer credit, including traditional branch lending, indirect lending, portfolio acquisitions, correspondent banks and loan brokers. Each distinct underwriting and origination activity manages unique credit risk characteristics and prices its loan production commensurate with the differing risk profiles.

Residential mortgages are originated through the Company’s branches, loan production offices and a wholesale network of originators. The Company may retain residential mortgage loans it originates on its balance sheet or sell the loans into the secondary market while retaining the servicing rights and customer relationships. Utilizing the secondary markets enables the Company to effectively reduce its credit and other asset/liability risks. For residential mortgages that are

retained in the Company’s portfolio and for home equity and second mortgages, credit risk is also diversified by geography and managed by adherence to LTV and borrower credit criteria during the underwriting process.

The Company estimates updated LTV information quarterly, based on a method that combines automated valuation model updates and relevant home price indices. LTV is the ratio of the loan’s outstanding principal balance to the current estimate of property value. For home equity and second mortgages, combined loan-to-value (“CLTV”) is the combination of the first mortgage original principal balance and the second lien outstanding principal balance, relative to the current estimate of property value. Certain loans do not have a LTV or CLTV, primarily due to lack of availability of relevant automated valuation model and/or home price indices values, or lack of necessary valuation data on acquired loans.

The following tables provide summary information for the LTVs of residential mortgages and home equity and second mortgages by borrower type at March 31, 2014:

At March 31, 2014, approximately $1.3 billion of residential mortgages were to customers that may be defined as sub-prime borrowers based on credit scores from independent agencies at loan origination, compared with $1.4 billion at December 31, 2013. In addition to residential mortgages, at March 31, 2014, $.3 billion of home equity and second mortgage loans were to customers that may be defined as sub-prime borrowers, unchanged from December 31, 2013. The total amount of consumer lending segment residential mortgage, home equity and second mortgage loans to customers that may be defined as sub-prime borrowers represented only .4 percent of total assets at March 31, 2014, compared with .5 percent at December 31, 2013. The Company considers sub-prime loans to be those made to borrowers with a risk of default significantly higher than those approved for prime lending programs, as reflected in credit scores obtained from independent agencies at loan origination, in addition to other credit underwriting criteria. Sub-prime portfolios include only loans originated according to the Company’s underwriting programs specifically designed to serve customers with weakened credit histories. The sub-prime designation indicators have been and will continue to be subject to re-evaluation over time as borrower

characteristics, payment performance and economic conditions change. The sub-prime loans originated during periods from June 2009 and after are with borrowers who met the Company’s program guidelines and have a credit score that generally is at or below a threshold of 620 to 650 depending on the program. Sub-prime loans originated during periods prior to June 2009 were based upon program level guidelines without regard to credit score.

Covered loans included $957 million in loans with negative-amortization payment options at March 31, 2014, compared with $986 million at December 31, 2013. Other than covered loans, the Company does not have any residential mortgages with payment schedules that would cause balances to increase over time.

Home equity and second mortgages were $15.3 billion at March 31, 2014, compared with $15.4 billion at December 31, 2013, and included $4.8 billion of home equity lines in a first lien position and $10.5 billion of home equity and second mortgage loans and lines in a junior lien position. Loans and lines in a junior lien position at March 31, 2014, included approximately $3.9 billion of loans and lines for which the Company also serviced the related first lien loan, and approximately $6.6 billion where the Company did not service the related first lien loan. The Company was able

to determine the status of the related first liens using information the Company has as the servicer of the first lien or information reported on customer credit bureau files. The Company also evaluates other indicators of credit risk for these junior lien loans and lines including delinquency, estimated average CLTV ratios and updated weighted-average credit scores in making its assessment of credit risk, related loss estimates and determining the allowance for credit losses.

The following table provides a summary of delinquency statistics and other credit quality indicators for the Company’s junior lien positions at March 31, 2014:

See the Analysis and Determination of the Allowance for Credit Losses section for additional information on how the Company determines the allowance for credit losses for loans in a junior lien position.

Loan Delinquencies Trends in delinquency ratios are an indicator, among other considerations, of credit risk within the Company’s loan portfolios. The Company measures delinquencies, both including and excluding nonperforming loans, to enable comparability with other companies. Accruing loans 90 days or more past due totaled $1.2 billion (approximately $.7 billion excluding covered loans) at March 31, 2014 and December 31, 2013. These balances exclude loans purchased from Government National Mortgage Association (“GNMA”) mortgage pools whose repayments are primarily insured by the Federal Housing Administration or guaranteed by the

Department of Veterans Affairs. Accruing loans 90 days or more past due are not included in nonperforming assets and continue to accrue interest because they are adequately secured by collateral, are in the process of collection and are reasonably expected to result in repayment or restoration to current status, or are managed in homogeneous portfolios with specified charge-off timeframes adhering to regulatory guidelines. The ratio of accruing loans 90 days or more past due to total loans was .49 percent (.30 percent excluding covered loans) at March 31, 2014, compared with .51 percent (.31 percent excluding covered loans) at December 31, 2013.

The following table provides summary delinquency information for covered loans:

Restructured Loans In certain circumstances, the Company may modify the terms of a loan to maximize the collection of amounts due when a borrower is experiencing financial difficulties or is expected to experience difficulties in the near-term. In most cases the modification is either a concessionary reduction in interest rate, extension of the maturity date or reduction in the principal balance that would otherwise not be considered.

Troubled Debt Restructurings Concessionary modifications are classified as TDRs unless the modification results in only an insignificant delay in the payments to be received. TDRs accrue interest if the borrower complies with the revised terms and conditions and has demonstrated repayment performance at a level commensurate with the modified terms over several payment cycles. At March 31, 2014, performing TDRs were $6.0 billion, unchanged from December 31, 2013. Loans classified as TDRs are considered impaired loans for reporting and measurement purposes.

The Company continues to work with customers to modify loans for borrowers who are experiencing financial difficulties, including those acquired through FDIC-assisted acquisitions. Many of the Company’s TDRs are determined on a case-by-case basis in connection with ongoing loan collection processes. The modifications vary within each of the Company’s loan classes. Commercial lending segment TDRs generally include extensions of the maturity date and may be accompanied by an increase or decrease to the interest

rate. The Company may also work with the borrower to make other changes to the loan to mitigate losses, such as obtaining additional collateral and/or guarantees to support the loan.

The Company has also implemented certain residential mortgage loan restructuring programs that may result in TDRs. The Company participates in the U.S. Department of the Treasury Home Affordable Modification Program (“HAMP”). HAMP gives qualifying homeowners an opportunity to permanently modify their loan and achieve more affordable monthly payments, with the U.S. Department of the Treasury compensating the Company for a portion of the reduction in monthly amounts due from borrowers participating in this program. The Company also modifies residential mortgage loans under Federal Housing Administration, Department of Veterans Affairs, and its own internal programs. Under these programs, the Company provides concessions to qualifying borrowers experiencing financial difficulties. The concessions may include adjustments to interest rates, conversion of adjustable rates to fixed rates, extensions of maturity dates or deferrals of payments, capitalization of accrued interest and/or outstanding advances, or in limited situations, partial forgiveness of loan principal. In most instances, participation in residential mortgage loan restructuring programs requires the customer to complete a short-term trial period. A permanent loan modification is contingent on the customer successfully completing the trial period arrangement and the loan documents are not modified until that time. The Company reports loans in a trial period arrangement as TDRs.

Credit card and other retail loan modifications are generally part of distinct restructuring programs. The Company offers a workout program providing customers modification solutions over a specified time period, generally up to 60 months. The Company also provides modification programs to qualifying customers

experiencing a temporary financial hardship in which reductions are made to monthly required minimum payments for up to 12 months.

In accordance with regulatory guidance, the Company considers secured consumer loans that have had debt discharged through bankruptcy where the borrower has not reaffirmed the debt to be TDRs. If the loan amount exceeds the collateral value, the loan is charged down to collateral value and the remaining amount is reported as nonperforming.

Modifications to loans in the covered segment are similar in nature to that described above for non-

covered loans, and the evaluation and determination of TDR status is similar, except that acquired loans restructured after acquisition are not considered TDRs for purposes of the Company’s accounting and disclosure if the loans evidenced credit deterioration as of the acquisition date and are accounted for in pools. Losses associated with modifications on covered loans, including the economic impact of interest rate reductions, are generally eligible for reimbursement under the loss sharing agreements.