U.S. Bancorp Earnings Hit Record High, Helped by Rates
October 18 2017 - 8:05AM
Dow Jones News
By Christina Rexrode
U.S. Bancorp, the biggest so-called regional bank in the U.S.,
said Wednesday that its third-quarter profit rose to a record
level, helped by higher interest rates.
The Minneapolis-based bank reported net income of $1.56 billion,
or 88 cents a share. That compared with $1.50 billion, or 84 cents
a share, in the same period a year ago. Analysts polled by Thomson
Reuters had expected 88 cents a share.
Revenue rose 4% from a year ago to $5.61 billion. That slightly
beat the $5.59 billion expected by analysts.
Like some other banks, U.S. Bank has benefited as the Federal
Reserve has raised interest rates this year, which allows banks to
charge more for loans. The bank's net interest income was up 8%
from a year ago.
Average loans were up 3% from a year ago. Consumer loans,
including residential mortgage loans and credit card loans, also
rose. Commercial loans increased, but commercial mortgages were
down.
Lending to businesses has been a key factor that analysts are
watching this year at regional banks, the group of firms that are
smaller than the big, national banks, yet bigger and broader in
reach than community banks. After the Trump election, bankers and
investors predicted that lending to businesses would take off, but
the growth of such loans has faltered.
Executives at U.S. Bank and others said last month that was
partly because corporate customers were paying off bank loans to
instead borrow from the bond market. The bank's
quarter-over-quarter loan growth was in line with what executives
had predicted last month, though they had lowered their
expectations from a previous forecast.
Income from treasury-management fees, trust and
investment-management fees and corporate-payment products rose from
a year ago.
Shares were unchanged in premarket trading.
Write to Christina Rexrode at christina.rexrode@wsj.com
(END) Dow Jones Newswires
October 18, 2017 07:50 ET (11:50 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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