US Bancorp shares rise as profit beats expectations

Key insights

• US Bancorp's net interest income (NII) rose quarter-over-quarter, beating analysts' expectations.

• The higher NII helped the bank's third-quarter profit come in above estimates.

• US Bancorp also increased funds set aside to cover loan defaults by 8.2%.

U.S. Bancorp (USB) shares jumped on Wednesday as earnings were boosted by higher-than-expected net interest income.

The bank reported third-quarter earnings per share (EPS) of $1.03, $0.04 higher than estimates from analysts surveyed by Visible Alpha. Revenue fell 2.4% year-over-year to $6.86 billion, falling slightly short of forecasts.

Net interest income (NII) of $4.17 billion was 2.4% lower than 2023 but increased 2.8% from the second quarter. It also exceeded expectations. Net interest margin increased to 2.74% from 2.67% in the previous quarter, but was lower than last year's 2.81%.

Provisions for loan losses are increasing

Like many of its peers, US Bancorp boosted its loan loss reserves, increasing them 8.2% year-over-year to $557 million.

Shares of US Bancorp rose nearly 5% on Wednesday to their highest level since early last year. In 2024 they have increased by about 14%.

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