Categories Earnings, Finance

Interest income bump lifts US Bancorp in the first quarter

U.S. Bancorp (USB) reported first quarter earnings of $0.96 per share, beating street estimates driven by bump in interest income and lower tax expenses. The bank’s bottom line rose 13.7% to $1.68 billion over prior year period, but dropped marginally compared to fourth quarter. Revenue increased 3.4% to $5.47 billion.

Net interest margin, a key metric tracked by investors, improved 7 basis points to 3.13%. Thanks to rising interest rates, the bank’s interest income grew 5.5% to $3.2 billion over last year quarter. The regional bank’s expenses shot up 5% to $3.05 billion mainly due to increasing labor costs. On the flip side, tax expenses nosedived 28.8% to $391 million on a taxable-equivalent basis.

Average loans rose 2.3% due to across the board growth in loans disbursed offset by 6.5% drop in commercial real estate loans. The bank’s average deposits saw 1.9% increase, primarily driven by time deposits.

Asset quality improved in the quarter where bank’s non-performing assets (NPA) decreased 19.5% to $1.2 billion, driven by improved performance in commercial and mortgage related loans. All the segments of the bank recorded double-digit growth compared to last year except Treasury and Corporate Support line’s profits declined 33%. The decrease was primarily due to increased labor costs and reduced profit contribution from investments from stocks.

US Bancorp Q1 2018 Earnings

Most Popular

Does Unity Software (U) stock has more room to run?

Last month, the IPO market was in a full swing. IPOs of Snowflake (NYSE: SNOW) and JFROG (NASDAQ: FROG) had an impressive opening day in September, the former creating a

PepsiCo (PEP): Steady snacking habits amid pandemic drive strong quarter for beverage giant

PepsiCo Inc. (NASDAQ: PEP) beat market expectations on both revenue and earnings for the third quarter of 2020. The company saw the momentum continue in its snacks business while the

Does the virus-driven boom make Electronic Arts (EA) a good investment?

With more and more people turning to virtual entertainment sources, amid the virus-related movement restrictions, video game publishers like Electronic Arts (NASDAQ: EA) are witnessing unusually high demand. Not surprisingly,

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top