Don't expect U.S. Bancorp to share any glowing news when it reports quarterly results next month.

Chief Executive Richard Davis said Tuesday that he expects a "neutral outcome" in the second quarter, as low interest rates continue to weigh on income from loans.

"Nothing is moving backward — everything is going slightly forward," Davis said at a banking conference sponsored by Morgan Stanley in New York.

Profits at the Minneapolis company were lackluster in the first quarter, dipping 3% to $1.4 billion.

Davis said he expects second-quarter net interest margin — a key measure of profitability — to shrink by 3-5 basis points compared with the first quarter. He attributed the projected decline to historically low yields on 10-year Treasury notes.

U.S. Bancorp's margin was 3.06% as of March 31.

Moreover, Davis reiterated that expenses are likely to grow by about 4% as the company ramps up spending on marketing and compliance.

Davis did not provide updated guidance U.S. Bancorp's oil book, though he said earlier this month that the company has "plenty" of reserves.

The Minneapolis company's reserves stood at 9.1% as of March 31. Total energy loans were about $3.4 billion.

Still, it's not all bad news.

The company's $263 billion loan book is expected to grow 1.5%. Additionally, fee-based revenue will likely be stable, Davis said.

U.S. Bancorp is scheduled to release its second-quarter earnings on July 15.

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