US Bancorp De (USB) September 2026 Conference Transcript

Next up, if everyone could take their seats, very pleased to have U.S. Bank Corp. from the company, Gunjan Keda, Chief Executive Officer, and John Stern, Chief Financial Officer. Welcome back, guys.

Glad to be here.

Good, Jim, maybe we'll just start with you. You're a little bit more than a year into your job as CEO at this point. Over that span, we've definitely seen a pickup in revenue growth, I think a pickup in sentiment around the name. Maybe just talk about how the pace of improvement at USP is better than you expected, worse than you expected, and maybe what have been some of the biggest drivers of the success the market is beginning to realize.

Well, thank you, Jason. Very nice to be here. And thank you for recognizing the progress in our results. It feels really rewarding to see the banks start to deliver financials that are consistent with our potential. When I stepped into my role April last year, I did inherit a very attractive franchise. Largely the mix of businesses, the fee-heavy businesses is very differentiating. It's very distinctive. The products were good. We had invested a lot in digital, and the customer base was very strong, especially with a union bank acquisition in California. There was just a very attractive customer base to work on. So the fundamentals were all in place. our opportunity was just good, consistent execution. The first year, we credit a lot of the inflection in the results to just urgency and pace. The first thing we did was to focus our efforts on three sharp strategic priorities. That was expense management, organic growth, and payments transformation, and did some meaningful shifts in resource allocations to support those priorities. and a lot of organizational changes. We elevated some revenue-facing roles in the structure of the company. There's been a very meaningful refresh of the talent, almost a quarter of the top 200 roles, so new to bank or new to roles, higher aspirations, flatter corporate center processes, a more leveraged compensation plan, and all of that collectively picked up more consistent financial results, and that was the first year. We are now four quarters operating within our medium-term financial guidance, and the first year has closed the valuation gap with our peers. But, of course, a lot more upside, but a good start in the first year.

I guess on the flip side, is there anything that has not gone quite as well as you have planned so far? And also, as you kind of look to year two or so under your leadership, is how are your priorities shifting, and are there areas you're more focused on to get them up to speed?

What's not gone to plan or disappointing, the biggest would be the mortgage and auto businesses. They are almost 10% of our companies, so very large businesses for us, and our base case was to see some moderation in rates and some pickup in that activity, and the demand there is very muted. So those have probably underperformed the base case in the last year. But for the rest, what has gone exceptionally well is expense management. We have taken almost five-plus points out of our efficiency ratio in the last two years, and fee growth inflection. We are at double digits over the last quarters, and those two pillars have surprised on the positive and quite a lot of runway going forward. So going forward, they continue to be very strong parts of the agenda. What gets added on in year two and beyond, Jason, are two other areas. The first is NII growth. We are very focused on our consumer and small business franchise. That improves our funding mix, our deposit mix, and we've seen some good results there. It will be another quarter of record consumer deposits. And on the loan side, we have focused very much on CNI and credit card growth, so that improves the loan mix. And collectively, they create both NII growth and NIM improvement. So that's an important part of the priority this year and beyond. And then the second, broadly, is making sure we get full leverage out of the twin technology shocks of AI and stable coins. Those are transformative levers for the industry, and we want to be very front-footed and ahead in terms of creating enduring success. Then I think all of the organizational health things that we started in the first year, as you know, these things take time, and they build a real high-performance culture. So as I think about my second year and beyond, you know, keep the momentum with expenses and fees, really inflect an AI, just get very front-footed with AI and stablecoin and just create a really high-performing bank.

You mentioned fees in that last remark as one of the areas, you know, almost 45% of revenue is a U.S. bank, so it kind of certainly differentiates you from some of the other super regionals. Just as you kind of think about the fee complex, maybe which areas you're most excited about over the next year or two and maybe which one's a little less so.

Well, first, I'm most excited that it is a fee complex, and it's a very marquee fee complex. You know, we have four fee categories, payments that we are known for, the trust and investments, which is very good for us, capital markets, and then the consumer fees, which is very traditionally seen in most banks. These are attractive. These are differentiated and very difficult to replicate either through organic growth or through acquisition. So we think it will be a differentiating feature for a long time. The beauty of these, the fee complexes, they do stabilize your earnings because there's a diversification benefit to them. The underlying growth trends are faster than GDP or population growth, which is really what the banking side gets anchored around. They also create very sticky relationships. So really that is a strategic focus for us is to keep the diversification of the complex and inch up even beyond the 44% that we see. The big two areas, though, is capital markets and payments. Capital markets, just because we are about 7%, 8% of revenue, we should be 10%, 11%. BTIG was a very strong start, and we expect to go into the balance sheet we are already deploying. So this is not more use of balance sheet that could inflect it even more, but right now we're just trying to get a fair share of the balance sheet that's being deployed. And the second is payments. You know, that was one of my first priorities, even in my president's role, and we are beginning to see the results inflect up every quarter. The growth rates are inching up. It is a long game, though. You have to wait for contracts to come due. So even on the credit card side, you have to wait for your marketing offers to sort of deplete out of the upfront cost. So we are very pleased with those, and those two will create sort of the fee engines going forward. Other categories, too, but they tend to be more ballast-like and steady.

We'll come back to maybe strategy and longer-term topics in a bit, but maybe kind of pull up for a second, and could you just talk to what you're seeing and hearing from your clients in terms of sentiment, spending, trends, et cetera?

It's all favorable, and our outlook is that as we end the year, the commercial clients are particularly vibrant. Loan pipelines continue to be very strong and quite diversified, so it's not just the AI trade. And the consumer is stable. We see some moderation of spend in August relative to the FIFA bump of June, but still very healthy delinquency, credit, all looks good. So it's a favorable outlook for the rest of the year.

I guess, John, we'll have to bring you in against that backdrop. You know, you had your slide deck, your slide in July with the outlooks for, you know, 3Q and the full year. Anything you want to call out or update us on?

Yeah, you know, Jason, it's going to be another strong quarter for us. We talked about net interest income being in that 4% to 6%. We anticipate being on the high end of that range on a year-over-year basis. Fee revenues, we mentioned to be 12% to 14%. We, again, expect to be on the high end of the range and maybe even above that, depending on some of the capital markets transactions that may or may not occur, but not in the third quarter. It will happen certainly in the fourth. So we feel really good about the momentum there on the revenue side. Expenses are going to come in as expected. We have 8% was what we had anticipated. So we feel like that's a good place for that to be, and charge-offs are very stable. And as Gunjan mentioned, there's a lot of momentum on the client side. So overall, we feel very good about, you know, where we're at. And, you know, we feel, you know, looking at it from a full-year perspective, you know, our outlook was 7% to 9%. As the third quarter is coming into shape, that just gives us confidence that we'll be on the higher end of the range. So it's just looking to be a very strong year for us.

Maybe we can kind of maybe double-click into some of those components starting with NAI. But, you know, one of the things we're hearing about is just a competitive environment. Maybe just talk to you how it's evolving for loans with deposit this quarter and anything you just call out in terms of demand and pricing.

Yeah, I mean, loans, you know, just looking at that, the market, as always, is competitive. But, you know, the spreads and everything like that have been pretty stable over the last several quarters, and I really haven't really seen anything that's unique or different there. Demand is still very strong, so we see just a lot of growth in that particular area. Gunjan mentioned some of the areas that we're paying more attention to from a growth standpoint. The deposit side, I'd say there is a lot of competition there. We're seeing more of our peers do specials, whether it's CD specials at higher rates or they're providing $750 to $500 for a new operating account on the consumer side. That money goes through marketing expense generally, but it's still all the same from a competition standpoint, right? And so we compete against that. The good news for us is we're competing very well on that space. Gunjan mentioned record consumer deposits. We feel like we're going to get that again. We've gotten some of the seasonality back on our commercial side, So we're going to have a very strong growth amount in the deposit side this quarter. It actually probably will outpace our loan side of the loan growth this quarter, which is a little bit of reversal of the second quarter. So all in all, we feel that the markets are right there in line with where we need to be.

Got it. And maybe, you know, one thing that some people talk to and you kind of see in the HA data, just a slowing of C&I growth, you know, so far this quarter. or maybe kind of just elaborate what you're seeing there?

Blunk growth is, I'd say the demand is still very strong. I mean, there's a lot of companies that are looking for CapEx. They're looking for additional capital and things like that. I think what we have seen is still very strong growth, but there is some timing. I think there is some time for things to get booked. I also think we are being a little bit more, we're looking at our levels in terms of return hurdles and things like that, and we're being a little bit more prescriptive on that. The first half, we saw some tremendous growth on the loan side of the equation. I'd say now we're being a little bit more strict about return hurdles and fewer exceptions, things of that variety. But still, beyond that, demand is still quite strong.

I guess all that said, on the July call, you mentioned that you expect it to be a little bit better than mid-single-digit growth for loans for the full year. Is that still the case?

Yeah, that is the case. Yeah, I expect 6% to 7% loan growth this year on a full-year basis, yeah.

Got it. And then maybe a little bit more on deposits. Gunjan, you mentioned before record consumer deposits. I think for this quarter, you know, that's certainly, I think, outpacing the industry there. So maybe talk to kind of what have been the primary drivers of the success and just how do you think about sustaining that growth over time?

Well, we are very intensely focused on strengthening the consumer and small business franchise, not only does it anchor high-quality deposits, it also provides the base that then we deepen in a quite disciplined manner with credit cards and then wealth. So our fee complexes really benefit from a vibrant consumer and small business franchise. So we have three very integrated strategies that we have deployed and are maturing. The first is just the products need to be attractive and differentiated so that you don't just pay up for deposits. We have done just some really good work interconnecting a banking and payments product. This is the Smartly Suite. It is now $84 billion. It's like a mini bank in itself and has just been a very attractive value proposition to the customers. Our branch and digital marketing people tell us it's easy to convey the value proposition and get people excited about something different. So we'll continue to lean in on creative value propositions that play to our strengths in terms of breadth. The second is deposit pricing, Jason. We have invested a fair amount in making it highly granular, highly surgical, and it allows us to optimize growth and cost of funds in a way that we were not doing a few years back. And so the micro-pricing disciplines have been helpful to us here. And now we are just scaling up the branch side. You might recall that over the last five-ish years, we've been at about $200 million a year in investment into the branch. And a big portion of that has gone into reformatting service branches and tier three locations into these broad multi-product hubs. That work is largely concluding at this point, and what we're looking at is a $300 million-like investment per year and going far more into new branch formats. Our earlier focus is on densifying into, within our footprint, those areas that have much higher household formation growth rates. And all of that, along with good branch execution and elevation and refreshing of the incentive structure, the tools, we are supporting them with some AI-enabled tools, and all of that is just coming together to create a sustainably better-performing consumer and small business franchise. A lot of that movement coming into the small business side, too, but the consumer is a few years ahead there.

Right. And I guess you put a press release out a couple weeks ago, talking about Florida, Georgia, Texas, you know, new markets that I guess we traditionally didn't think of you, maybe in from a branch standpoint. Just, you know, why now? And just will you need branches over time to kind of serve that segment?

Yeah. So maybe I'll step back and just explain the context of the press release. We got a lot of interest in our business banking expansion markets press release. So three quarters of our businesses, so this is all our institutional businesses, our payments businesses, our wealth businesses, do operate fully nationally and have been for some time. Approximately five years back, we started to be intentional about creating client centers that co-locate our wealth, our commercial real estate, our commercial, and our mortgage teams. And these client centers sometimes have branch licenses, but they are cashless branches. They're mostly sort of not branches and like office spaces. We have found that the upper end of the small business can also serve clients in that model. So this recent expansion is to co-locate the higher end of the small businesses with these client centers. These are in all the vanguard markets that is seeing a lot of population and business growth. The smaller end of the small business, which is also very attractive from a deposit side, does need branch presence, so it is our expectation that in due course our retail network will follow these expansion markets or at least some of them, although right now our retail focus, as I said, is really on densifying markets. So it's a very long-range strategy that sees ourselves inching out of our traditional places. We are just choosing to do it with Vanguard businesses. For example, Atlanta is a hub for our payments business. That's where Elevon and Merchant is And Dallas, we have a very large technology presence in Dallas and Houston. And Houston is very big for our corporate trust business. So we are also leveraging some of our national presence. It gives you connectivity. It gives you a reason to extend the brand presence. And we are investing a lot in national brands with the NFL with the sense that these are all ingredients you need on top of just a pure branch expansion to truly sort of create a better national presence.

You can probably guess the next question. Would a bank acquisition help accelerate that process?

You know, I get asked that question a lot, and I do feel like I have to say I don't have anything ideological, philosophical against a bank acquisition. Our organic opportunities are very high, So when we look at any of our inorganic or organic options, we are saying what's the bar for strategic fit, for execution risk, for financial and cultural fit, and right now our organic opportunities are very clear and present, and that's been our focus.

Sure. I guess, John, maybe back to you. There's this ongoing debate with investors between the trade-off between NII dollar growth and NIM. Banks that can grow both seems to be ideal. There's not all of them to do that, but you've talked before about a path to a 3% NIM at some point next year, which I think is up 20 basis points from where we are. At the same time, a couple of banks have kind of talked about some pressure there. So how do you think about that 3% number, and can you get there, will you get there, and just any updated thoughts around that?

Yeah, your first comment there, the debate, which is an interesting way to put it, we have that conversation quite a bit internally, just is it net interest income, is it net interest margin, and I think the answer is yes. You have to look at both. I mean, I would lean toward net interest income because at the end of the day, that's going to drive EPS and all that sort of thing. But you can't do that and just completely ignore the metric of net interest margin. I think there's a feel of efficiency there. There's a balance sheet stewardship mindset that you have that goes along with net interest margin. Fortunately for us, we expect to grow both net interest income and net interest margin here in the third and the fourth quarter. We think that's powered very much by the asset mix. Gunjan has talked about that a little bit. Fixed asset repricing is favorable. So, yeah, we do see and continue to see a path on 3% net interest margin. And, you know, you asked, is it getting any harder? I guess, you know, 18 months ago, we didn't know if the Fed was going to be in a hike cycle, and that's new and different. And so not that the hikes themselves are consequential to net interest income for us, but it's the curve after that, right? What does the curve look like? So that's something that we'll focus on very much in 2027 as we kind of think about our budgeting and all that sort of thing. But we definitely see a path. But at the end of the day, I do lean non-interest income. That's where our clients, you know, where our clients seem to be is going to be of utmost importance. We're not going to manage to a metric just for the sake of managing to it. But it's really all about the client growth and where is that coming from.

Got it. And then on fee income, you got it to the upper end of 12% to 14% for the quarter. I think for the year you were talking about low teens growth. I'm not sure if there's an update there. Let me just kind of drill down and just give us some flavor in terms of what's performing better than expected this quarter.

Yeah, fee revenue has a lot of momentum in a lot of areas. We talked about the fee complex, the four-legged stool, however you want to kind of call it. All these areas are doing quite well. So maybe just to start, capital market's very strong. You know, this is going to be the first quarter, as you know, where we have BTIG fully loaded. So from a fee growth perspective, that will be not quite, but about half of our fee growth will come from just BTIG being now in the run rate. But the broader or the legacy capital markets businesses are doing very well. I expect, you know, a low double digit from a capital market standpoint in the core kind of legacy businesses, whether that's foreign exchange or commodities, loan syndications, they're all doing very well. There's just a lot of activity and market gains that I believe we're making. On the payment side, I expect continued strong growth there, very similar to what we had in the second quarter. Bright spots there include the consumer card. It's doing very well. Gunjan highlighted a couple points there as well as our corporate payments. A lot of new business being won, a lot of just market tailwinds that are supporting that business, so we feel really good about that. On the merchant processing side, we're likely looking at a flat year-on-year growth for merchant processing, and that probably will persist for the next two or three quarters as we're kind of working through, you know, our go-to-market strategy and kind of shedding some distribution partners and things like that. And then finally, the investment products and investment services businesses like corporate trusts, fund services and things like that, doing very well, just like clockwork, taking advantage of the marketplace, taking advantage of their market share. There's a lot of market activity there, and that bodes very well for those businesses, so strong growth there as well.

If we could maybe double-click on BTIG, Goonjin, you mentioned you want to take them from 7% of revenues to 10%. I imagine that's the context of the rest of the company continuing to grow. So I guess, you know, how do you envision kind of building it to a bigger component?

So we have started off beautifully with BTIG. You know, there's a lot of conversation around culture fits, and these executives have been great colleagues of ours, have really embraced the bank. We measure referrals, and they're going both ways very strongly. So we have great hopes of this marriage going forward. The bar from 7% to 11% requires capital markets to go twice the rest of the franchise, and I hope the rest of the franchise makes it harder and harder for them, and we are very comfortable with that path going forward. So the levers are twofold. On the fixed income side, which is a legacy business, it's really new product introductions organically. Commodities was a big build-out over the last couple of years. if the timing was very right, that has performed very well. We've introduced some macro capabilities, and we'll keep doing that. And on BTIG, it's a very nascent investment bank. It's the equity, and that is leveraging our existing relationships and our existing balance sheet and their product capabilities. I do not expect it to be a meaningful M&A-driven growth rate, although if we see something unique that's a small bolt-on, we'll certainly be open to it. but it's a largely organic play, really bringing together the balance sheet that's in play with the new capabilities that we haven't had our fair share there.

Got it. I guess one area I haven't asked you about in a while, global fund services and corporate trust. But just maybe talk to, you know, those are businesses that others, you know, some of your peers actually don't have, and just, you know, how they give you a competitive advantage when you're talking to new or current clients.

Well, first, thank you for asking me about investment services. It is, like John said, not a business we talk about very much. But collectively, these two businesses are now almost 10% of our revenue. So they matter. They are very fee intensive. The fees are recurring fees. If we lose a business today, it will be 18, 24 months before we lose the revenue. And so, you know, very sticky relationships, large, large relationships. These are also producers of very good operating deposits, 70, 80 billion in operating deposits. They give us a lending capacity that you wouldn't otherwise have. And they create the most sticky relationships. What has created success for this, and you see these businesses in the trust banks a fair amount. So you do sort of explore that area, just not with the traditional banks, is that our deposits do more just because of our lending capacity. You know, if you're only deploying your deposits into an investment portfolio, your natural NIM is much less than when a bank owns these. But the market share gains outside of just the market momentum have come from two areas that are very vibrant for us.

One is ETF formations.

We early on got very good with brand-new ETF startups. because some of the large families were pretty anchored with the large trust banks. That has turned out to be a very meaningful growth engine for us, because so many 40-act funds are converting to ETF structures, and all of the mania around cryptocurrency, AI, has come to the investment market through an ETF structure, which is a low cost, and we have just a very disproportionate share of brand new ETFs, and many of them have become very sizable. So that's been a sort of market share gain strategy. And the second is private credit, corporate trust, which is largely a fixed income type of a business. It's a large business for us. And so we have very good waterfall capabilities, private credit capabilities. And as that market has taken off in the last five or seven years, our business has grown a lot. So we think very intentionally about connecting that as a way of getting paid for balance sheet usage with people who really do need a lot more balance sheet. And now with even the BTIG acquisition, there's just so much of the trading volumes from these businesses that was going to third party is now hopefully going to be reverse referrals back to the equity trading businesses. So these businesses are very interconnected with the bank franchise, and that's the biggest point I want to make, not just attractive as a stand-alone thing that we own, but products that really deepen our client relationships on the institutional side.

Got it. And maybe, John, for you on expenses, you know, a two-part question. You know, first, when you talk to the high end of the up 7% to 9% revenue growth for the full year, I guess any update to your operating leverage target for the full year? And then just secondly, as you kind of head into the planning season, you know, for next year, or just how you're balancing investments versus operating leverage and just how you're thinking about their target or just how that plays through?

Yeah, I mean, first of all, in operating leverage, we feel very comfortable with at least 200 basis points of operating leverage for the full year, at least 300 if you exclude BTIG, so we're on a really good path there. If I think about the budgeting process that we have right now, And, you know, we're very committed to positive operating leverage. That's kind of the starting point that we have. I think it would take us to be, you know, in that 55 to 58 range for a long, consistent period of time before we would ever really consider start to, you know, move away from that sort of commitment. We are not there yet. But as I think about 27, I would think more about, you know, we have revenue growth and a lot of tailwinds that are coming our way. Our mindset is around revenue focus, as Gunjan has laid out in her priorities, as well as, you know, we have this commitment to operating leverage. That should give us a very nice, high-quality earnings per share growth, and that's what we're focused on for 27. So as I think about, you know, kind of the future and the journey that we're going on, though, there will come a time, assuming we can and we expect our ranges to be up and to the right, so to speak, in our medium-term targets and we get closer to that mid-55 area, that we start to focus less on operating leverage and more on EPS growth, being a high-return bank, more so than we even are now, as well as just investing in our products and capabilities and making sure we have that sort of investment in doing that. So that's really the focus that we have. We're not there yet, but that's just kind of what our aspirations are at this point.

I'll add one thing. We keep getting asked the expenses versus investing in the franchise. It's not a tradeoff. The expense management is coming from what I call true productivity. We have invested an enormous amount of money over the last five years, like $5, $6 billion, into just updating every platform, custody platform, loan underwriting platform, the core modernization, the cloud program, and that yields productivity over time. The investments are coming outside in if you lower in technology and marketing because we are really expanding the sort of revenue side of the equation with both of those. So I just wanted to amplify the point that we are not thinking of productivity as a trade-off with investing into growth.

Got it. Maybe shifting to credit quality, the nine for you and many of your peers so far, any areas in your portfolio you're watching more closely, any areas you're seeing cracks, what should we be paying attention to? And is the Fed starting to hike, change anything?

Well, I mean, our answer is very boring. There's just nothing that we see that's really an area of issue right now. As I mentioned, credit metrics are likely going to be stable in quarter. We are watching for what is the impact of higher interest rates, what's the impact of potential inflation, the AI cycle as we're going through that, if there's anything that derails off of that. Is there any exposure? So those are kind of the conversations that we're having on credit and just kind of watching in different pockets. So we have our eyes set on areas that we are watching, but I don't see anything right now that gives us any concern. Got it.

And just maybe on capital deployment, you know, you've kind of been buying back stock $200 million a quarter. You know, you talked about this payout ratio, 70%, 75% at some point. You're obviously below that now.

Yeah.

I don't know. Is there a timeline or how should we be thinking about when you're returning to that level?

Yeah. So a couple of things. Maybe just our framework on capital. We we prioritize organic growth, client growth, as well as dividend. Those are priorities. One A, one B, you know, however you want to want to say it. And then Sherry purchases. Right. And so as I think about the third quarter, we've had a lot of demand on our on our capital. We've had a lot of strong growth. We've talked about the high demand that we have on capital. We've talked about the Amazon portfolio, and that's coming online. We've also had interest rates move up pretty significantly this quarter. So given just our prudent nature, we actually elected to pause on buybacks for the third quarter. But we're shortly thereafter where we expect to go back right into share purchases and to increase those and very much committed to that 70%, 75% area. And so that's what we're really focused on. We are still building our capital for a Cat 2 perspective. We still think 10% on a Cat 2 basis is the right level for us. And, you know, we generate 25, 30 basis points of capital a quarter, and that has been increasing as we've been earning more and more over this time frame. So I still feel good about the long-term projections of our share buyback program. Do you care to guess on what time frame we get back to that? Oh, we think right away. I think it's shortly. So it's just this is a quarter where we had a lot of demand. It was a lot of unique things going on. Amazon was a big amount for RWA. We had the interest rate movement, which affects the AFS portfolio. So those were kind of the big factors that swayed us here. That's just a temporary thing.

So 70-75 is still the right way to think about it.

That is absolutely the right way to think about it.

Got it. And then you mentioned CAT2. Is there anything around that we need to know in terms of that impacts liquidity, NIM, expenses that, you know, will change things?

You know, our CAT II, we're just, you know, we continue to grow. As you know, from our seat, what we anticipate getting to that CAT II, effective date would be either the second or the third quarter is likely when that would occur. You know, there's like a two-quarter lag between when you go over the $700 billion to when you actually become that. So second, third quarter is probably the right way to think about it. And, you know, we have the appropriate amount of liquidity. We have all the expense and the reporting kind of built in. We've already been kind of ramping up our discussions with regulators on it. So we feel like it's kind of as expected.

Got it. And then, Gujan, earlier you kind of touched on stable coins and digital currencies, and how do you talk to new use cases, tangible benefits that you see?

On the AI program? Both of those?

Both AI and digital currencies.

So there's a lot of focus on it internally. On the AI side, we are seeing very real, measurable benefits on the productivity use cases, the revenue use cases are gearing up more, and so we expect them to contribute, the bigger contributor going forward. A lot of conversation in the industry around the slowdown. We don't, you know, our use cases don't require the most complex frontier models, so we don't think the slowdown of model upgrades impacts our program. If anything, it helps us. It's a little difficult to keep up with all those model upgrades when you don't need most of the capacity, so maybe just a little breathing room to use the stuff that we already have. So it's a very powerful technology, and we think it has the potential to really elevate and differentiate and personalize the customer experience and shred the productivity. We are implementing it in a very methodical, straightforward way, and it's a big contributor to our expense management program. And we don't see that changing with all of the debates that we're hearing. The stable points was new. We introduced U.S. Bank Digital Coin and did the first transaction with our own Dublin Bank. The thesis there is the numbers are very large on stable coin transactions. The majority of them are cryptocurrency trading with each other. The real payments use cases are still nascent, but what has shifted in the last few quarters is many of our clients are engaging with us to really see if there's something there. So the use case that is most real for us is the 24-7 gap with the banking system. And is there some way to tokenize deposits on a Friday and rebring it back to the balance sheet on Monday, but have some transaction capabilities with stablecoins. So that's the use case that we announced. We are not going to compete on the actual stablecoin infrastructure. This one was stellar. We are part of many consortiums. What we are building, which we think could be differentiating, is what we call digital assets platform, DAP. So clearly, our marketing people didn't have anything to do with the naming. It's called digital asset platform. But we are building into that the compliance and controls of a bank. So the clawback capability with stable coins, the ability to block airdropping, these are things that are quite important to our commercial clients, and we think that could be a differentiator. But I will say that the supply side is far more active than real demand. So excited to take this step. We'll have tokenized deposits early in the year, and still exploring the revenue models. Makes sense.

We've got two minutes left. Maybe, Gunjan, as you kind of look to build on your success after your first plus year as CEO, just how would you define what the next legacy looks like as you look out over the next couple of years?

Well, thank you. We talked about many of the ingredients just to put it together. The first year was helpful in bringing back the confidence, confidence externally and internally creating momentum as we look forward our focus is on EPS growth within tight guardrails of return and prudent risk management. Strategically, we are very committed to being a very attractive, fee-heavy complex and then increasingly delivering scale and national presence. And that, along with just re-bringing back the high-performance consistency that many of you expect out of U.S. Bank's name, we think is a franchise that brings back the premium valuation and more. So that, in a nutshell, is the plan looking forward.

Great place to end it. Gunjan, John, thank you for your time today. Thank you.