U.S. Bancorp in Minneapolis reported higher first-quarter profits as gains from fee-based business lines overcame higher expenses.

1Q boost
U.S. Bancorp's fee income rose 8% on increases in credit card, investment management and other business units. Bloomberg News

The $449.5 billion-asset company earned $1.4 billion during the quarter, or 4% more than a year earlier. Earnings per share were 82 cents, beating by 2 pennies an average estimate compiled by FactSet Research Systems.

Noninterest income was a key driver of the company’s performance, rising 8% to $2.3 billion thanks to increases in credit cards and investment management among other business units, it said in a news release Wednesday.

Net interest income increased 4% to $2.9 billion. The net interest margin dipped 3 basis points to 3.03%, which the company attributed to loan mix and investment yields. Total loans grew 4% to $273 billion.

Noninterest expenses jumped 7% to $2.9 billion, due in part to higher compensation and marketing costs.

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Kristin Broughton

Kristin Broughton

Kristin Broughton is a reporter for American Banker, where she writes about the business of national and regional banking.