U.S. Bancorp on Wednesday reported stronger quarterly results thanks to revenue gains from its loan book as well as a one-time, $910 million accounting benefit related to the tax law.
The Minneapolis company's fourth-quarter profit of $1.7 billion was 14% higher than a year earlier. Earnings per share were 97 cents, or 11 cents more than an estimate compiled by FactSet Research Systems.
Net interest income increased 6% to $3.1 billion. Total loans rose 3% to $280.4 billion primarily due to increases in commercial lending and auto leasing. The net interest margin climbed 10 basis points to 3.08%.
Noninterest income, at $2.4 billion, was flat from a year earlier as gains in card revenue and corporate payments offset double-digit declines in mortgage banking.
Noninterest expenses spiked 31% to $3.9 billion. A number of one-time items drove the sharp increase in costs, including a special employee bonus and charitable contribution following the signing of the tax law in December.
A $608 million accrual for the company’s ongoing issues with money laundering controls also contributed to the expense increase.
U.S. Bancorp disclosed last year that it was cooperating with a federal investigation of the race car driver Scott Tucker, who is accused of running a payday lending scam. The $462 billion-asset company in 2015 was also hit with a consent order from the Office of the Comptroller of the Currency, which ordered it to boost its money laundering controls.
The company expects to settle those issues “soon,” it said in a press release announcing its the results.