U.S. Bancorp earned $65.8 million in the third quarter, up 58% from the same period a year ago. The Portland, Ore.-based company, which has $21 billion of assets, said the gain was fueled largely by improving credit quality and higher revenue.
The company's earnings translate to a 1.25% return on assets and a 15.74% return on equity.
Strong Credit Card Fees
U.S. Bancorp recorded a 42.3% rise in noninterest revenue during the quarter, reflecting strong credit card and mortgage banking fees. It also booked a net gain of $116 million from the sale of mortgage servicing rights.
Net interest income rose 10% from the 1992 third quarter, the result of a modest increase in loan volume and a 26-basis point increase over last year's net interest margin in the third quarter.
The company said overall loan demand in its markets was moderately strong, despite economic weakness in Washington State and Northern California.
Nonperforming assets dropped 9%, permitting U.S. Bancorp to add $17.5 million to loan-loss reserves, its lowest provision in more than three years.
In one sour note, noninterest expenses rose 11% from a year ago to a relatively high 65.8% of revenue for the quarter. U.s. Bancorp said the increase reflected marketing costs and acquisitions in California and Nevada.
