U.S. Bancorp reshuffles leadership, CFO reports to CEO

MINNEAPOLIS – U.S. Bancorp (NYSE: USB), the parent company of U.S. Bank, has announced a reorganization of its leadership structure, which includes Chief Financial Officer John Stern now reporting directly to Chairman and CEO Andy Cecere. This change is effective immediately and is part of a broader strategy to align the company’s leadership team with its growth objectives.

John Stern, who took on the CFO role in 2023, has a history with the company that includes serving as president of its global corporate trust and custody business and nearly eight years as corporate treasurer. His new direct reporting line to Cecere underscores his pivotal role in the company’s financial leadership over the past year.

In anticipation of Vice Chair of Payment Services Shailesh Kotwal’s retirement in the first half of the next year, U.S. Bancorp is also adjusting its payments business structure. The Payment Services business will now be divided into two divisions: Payments: Merchant and Institutional (PMI) and Payments: Consumer and Small Business (PCS). The leaders of these new divisions will report to President Gunjan Kedia following the transition plan for Kotwal’s retirement.

Mark Runkel, currently Chief Transformation Officer, will lead the PMI division starting in early January. Runkel’s experience includes significant involvement with the company’s merchant and institutional payments businesses in his previous credit and risk roles. Terry Dolan will take over the responsibilities currently overseen by Runkel while continuing to lead the company’s administration office.

The recruitment process is underway for the head of the PCS division, who will oversee personal and small business debit and credit cards, among other functions. The company aims to fill this position in the first half of 2025.

These leadership changes are part of U.S. Bancorp’s strategy to capitalize on its current growth trajectory and leverage its investments and disciplined approach to financial results. The company, which employs over 70,000 people and reported $686 billion in assets as of September 30, 2024, offers a diverse range of banking and financial services.

This restructuring reflects U.S. Bancorp’s commitment to adapt its operations and leadership to the evolving demands of the financial services industry. The information is based on a press release statement from U.S. Bancorp.

In other recent news, U.S. Bancorp has been the subject of several analyst notes following robust earnings reports. Deutsche Bank downgraded U.S. Bancorp’s stock from Buy to Hold due to concerns over macroeconomic risks and elevated market valuations. Despite the downgrade, the bank’s earnings per share (EPS) of $1.03 in both Q3 and Q4 of 2023 and net revenue of $6.9 billion in Q3 2024 were noted.

Several financial firms adjusted their price targets in response to these results. DA Davidson, Oppenheimer, Baird, RBC Capital Markets, and Stephens increased their price targets to $54, $59, $54, $53, and $52 respectively, while JP Morgan maintained a neutral stance with a consistent price target of $48.

U.S. Bancorp has also expressed a clear stance against mergers and acquisitions, opting instead for organic growth. The bank plans to initiate modest share buybacks in the near future and continues to invest $2.5 billion annually in technology, including AI initiatives. Successful partnerships with State Farm and Edward Jones are anticipated to support future growth. These are the recent developments for U.S. Bancorp.

InvestingPro Insights

U.S. Bancorp’s recent leadership reorganization aligns with its strong market position and financial performance. According to InvestingPro data, the company boasts a substantial market capitalization of $76.45 billion, reflecting its significant presence in the banking sector. This is further supported by an InvestingPro Tip highlighting U.S. Bancorp as a “prominent player in the Banks industry.”

The company’s financial health is underscored by its impressive dividend track record. An InvestingPro Tip reveals that U.S. Bancorp “has raised its dividend for 13 consecutive years” and “has maintained dividend payments for 54 consecutive years.” This consistency in dividend payments, coupled with a current dividend yield of 4.15%, demonstrates the company’s commitment to shareholder returns and financial stability.

U.S. Bancorp’s profitability is evident in its P/E ratio of 14.98, which suggests a reasonable valuation relative to earnings. Additionally, the company’s revenue for the last twelve months stands at $24.9 billion, with an operating income margin of 30.98%, indicating robust operational efficiency.

These insights from InvestingPro complement the article’s focus on U.S. Bancorp’s strategic leadership changes, suggesting that the company is well-positioned to capitalize on its strong financial foundation and market presence. Investors seeking more comprehensive analysis can access additional tips and metrics through InvestingPro, which offers a total of 9 tips for U.S. Bancorp.

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