U.S. Bancorp in Minneapolis reported higher quarter earnings as revenue growth outpaced higher expenses.
The $402 billion-asset company reported that its fourth-quarter income rose 2% from a year earlier, to $1.49 billion. Earnings of 79 cents a share beat the average estimate of analysts polled by Bloomberg by 2 cents. Revenue increased 6%, to $5.17 billion.
Net interest income rose 2.4%, to $2.8 billion, up 2.4%. Average total loans increased 6%, to $246.4 billion, while the net interest margin compressed by 26 basis points, to 3.14%.
Noninterest income jumped 10%, to $2.37 billion. The company attributed the increase to "higher revenue in most fee businesses and higher other income, including" a $124 million gain tied to an equity interest in Nuveen Investments.)
Operating expenses rose 4.5%, to $2.8 billion. The company attributed the increase to "accruals related to recent developments in several legal matters, charitable contributions and an increase in compensation expense, reflecting the impact of merit increases, acquisitions, and higher staffing for risk and compliance activities."