MINNEAPOLIS ( TheStreet) -- Even though it's still waiting for guidance from regulators about capital requirements, U.S. Bancorp ( USB) views an eventual dividend increase for shareholders as a top priority.

"I think the Fed, up until the last few calls, has been waiting, like we all have, for a stronger, sustained economic recovery," Chairman and CEO Richard Davis said during a conference call with analysts on Wednesday.

Davis added: "I think that's still present, but I think now all that has been trumped by the waiting and seeing on the G-20 activities in November, at which point we'll start giving guidance on what kind of capital levels we need to look for in a certain period of time, measure those against the stress test and get permission to go or no go."

U.S. Bancorp is "still, I think, first in with our application to increase the dividend," Davis said.

U.S. Bancorp currently pays an annual common stock dividend of 20 cents a share. It slashed its quarterly payout to 5 cents a share from 42.5 cents a share in the first quarter of 2009, as the financial crisis came to a head. The bank paid its most recent quarterly dividend to shareholders on July 15.

Investors waiting to see the return of meaningful dividends to bank stocks may have some downtime ahead of them, possibly until the end of the year at the very least. Observers say that regulators are pressuring banks to hold off on increasing their payouts as the economy gradually gets back on its feet.

Instead, some banks are looking to share repurchases as a shareholder-friendly way of using excess capital. JPMorgan Chase ( JPM) disclosed it recently repurchased $500 million worth of stock when it reported its second-quarter earnings last week.

Chairman and CEO Jamie Dimon said he is more inclined to do share buybacks these days rather than raise the bank's dividend. In prior quarters, Dimon had stressed a desire to raise the dividend as soon as was feasible, so the commentary this time around was a definite shift.

U.S. Bank didn't repurchase any stock this quarter, but it did swap roughly $430 million of perpetual preferred stock in exchange for certain "income trust securities," which added 5 cents a share to earnings.

U.S. Bank said it is aiming to get back to its old capital allocation model of using earnings to pay back shareholders through dividends and share repurchases.

"Our old model was a majority of the earnings pay back in the form of dividends or share repurchases, with the remainder putting back into the company for investment," Davis said on the call. "We still see that. We're going to make sure that there's room for both buybacks and dividend increases over the course, long course of the future. But we like that model. We think it's served us well and shareholders deserve that."

U.S. Bank beat Wall Street earnings expectations early Wednesday, with its performance boosted by lower loan loss provisioning and a solid increase in revenue year over year as top-line growth continued to benefit from acquisitions made during the height of the crisis. Davis noted on the call that further acquisitions are possible.

U.S. Bancorp shares were most recently rising 0.7% to $23.30.

--Written by Laurie Kulikowski in New York.
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