Growth in commercial lending, mortgage lending and some payments businesses helped U.S. Bancorp in Minneapolis match profit expectations for the first quarter.
Net income for the $475.8 billion-asset U.S. Bancorp rose 1.5% year over year to $1.7 billion. Earnings per share came in at $1, in line with the mean estimate of analysts polled by Fact Set Research Systems.
Total loans increased 2.4% to $286.1 billion. Commercial lending rose 4.6% to $101.9 billion, and residential mortgages rose 9% to $65.6 billion. Credit cards also increased 6.2% to $22.6 billion, and retail leasing increased 7.6% to $8.6 billion. Commercial real estate, home equity and other retail lending declined on a yearly basis.
Noninterest income increased slightly to $2.3 billion. Corporate payment and merchant processing fee income rose on a yearly basis, while deposit service charges, card revenue and mortgage banking revenue fell.
“We had a good start to the year with momentum continuing across our lending and fee businesses,” Chairman and CEO Andy Cecere said in a press release Wednesday. “In the first quarter, our industry-leading returns on assets and equity were supported by solid loan growth, disciplined expense management and stable credit quality.”
Net interest income increased 2.9% to $3.3 billion in the first quarter. The net interest margin widened 3 basis points to 3.16%.
U.S. Bancorp increased its provision for credit losses by 10.6% to $377 million. Net charge-offs rose 7.6% to $367 million and represented 0.52% of total loans compared with 0.49% a year earlier.
Deposits increased slightly to $335.4 billion. Non-interest-bearing deposits declined 7.6% to $73.4 billion, while interest-bearing deposits increased 2.7% to $261.9 billion.
Noninterest expenses increased 1% to $3.1 billion.