U.S. Bancorp in Minneapolis reported higher quarterly profit boosted by increased fee revenue from credit and debit cards.
The $438 billion-asset company reported that its second-quarter earnings rose 3% from a year earlier to $1.5 billion. Earnings per share of 83 cents were 2 cents higher than the average estimate of analysts polled by Bloomberg.
Fee income rose 12% to $2.6 billion. The increase was driven, in part, by higher card transaction volumes. Equity gains from U.S. Bancorp's investment in Visa Europe, which was
Net interest income rose 5% to $2.9 billion. Total loans grew 8% to $268 billion on higher commercial and construction lending. The net interest margin compressed by 1 basis point to 3.02%.
Energy troubles continued to weigh on the company's loan book, as the loan-loss provision increased by 16% to $327 million.
Revenue gains helped to offset sharply higher costs. Noninterest expenses climbed 12% to $3 billion on a combination of compensation and marketing costs.
The efficiency ratio edged up to 54.9%, compared to 53.2% a year earlier.
