U.S. Bancorp : 2nd-Quarter Net Up 18% on Lower Credit Costs and Higher Revenue
07/18/2012| 07:59am US/Eastern
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By Chelsea Stevenson
U.S. Bancorp's (USB) second-quarter profit rose 18% as the lender reduced its credit costs and posted strengthening revenue growth.
The large regional bank has been one of the strongest performers in the banking industry, with solid lending demand. Lending activity in the latest quarter was $67.2 billion. The activity has aided its momentum and helped offset some of the continued pressure the sector faces from ultra-low interest rates, though weak job reports earlier this summer caused shares to tumble.
Average total loans at the bank increased 7.7% in the latest period amid a 19.9% jump in commercial borrowing and 24.3% surge in commercial and commercial-real-estate commitments.
Loan-loss provisions totaled $470 million in the latest quarter, down from $572 million a year earlier and $481 million in the first quarter.
For the period ended June 30, U.S. Bancorp reported a profit of $1.42 billion, or 71 cents a share, up from $1.2 billion, or 60 cents a share, in the year-ago quarter. Revenue climbed 8.1% to $5.07 billion.
Analysts polled by Thomson Reuters most recently expected earnings of 70 cents a share on revenue of $4.98 billion.
Shares closed Tuesday at $32.95 and were inactive premarket. The stock has been up 35% in the past 12 months.
Write to Chelsea Stevenson at chelsea.stevenson@dowjones.com
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