U.S. Bancorp Announces 21 Percent Increase in Common Stock Dividend.

MINNEAPOLIS -- The board of directors of U.S. Bancorp (NYSE:USB) has approved a 21 percent increase in the dividend rate on U.S. Bancorp common stock to $1.60 on an annualized basis, or $0.40 on a quarterly basis. The board declared a quarterly common stock dividend of $0.40 per common share payable on January 16, 2007, to shareholders of record at the close of business on December 29, 2006.

U.S. Bancorp, through its predecessor companies, has increased its annual common share dividend rate in each of the past 35 years and will have paid a dividend for 144 consecutive years as of January 16, 2007. Prior to this announced increase, U.S. Bancorp's dividend on an annualized basis was $1.32, or $0.33 on a quarterly basis.

Richard K. Davis, president and chief executive officer of U.S. Bancorp noted, "We are very proud of U.S. Bancorp's long history of paying a dividend, which provides our shareholders with an additional reward for investing in our company. Increasing the dividend by 21 percent is an important part of our strategy to continue our commitment to return at least 80 percent of our earnings to our shareholders through dividends and a stock repurchase program. We believe shifting the total payout to shareholders toward a higher mix of dividends is a more effective means to transfer the company's superior profitability directly to the shareholders. The decision to move to a greater proportion of dividends in no way diminishes the growth prospects of the company, since we will continue to retain 20 percent of earnings to support expected asset growth, capital expenditures and cash acquisitions. A higher dividend payout such as this is consistent with our strategy of low risk, dependable earnings and financial discipline."

The board of directors has also declared a regular quarterly dividend of $381.66 per share (equivalent to $.38166 per depositary share) on U.S. Bancorp's Series B Non-Cumulative Perpetual Preferred Stock, payable January 16, 2007, to stockholders of record at the close of business on December 29, 2006.

U.S. Bancorp, with $217 billion in assets, is the 6th largest bank holding company in the United States. The company operates 2,467 banking offices and 4,943 ATMs in 24 states, and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services products to consumers, businesses and institutions. U.S. Bancorp is the parent company of U.S. Bank. Visit U.S. Bancorp on the web at www.usbank.com.