U.S. Bancorp Q2 earnings helped by improved NII, loan growth, higher rates (NYSE:USB)

U.S. Bancorp (NYSE:USB) third-quarter earnings topped the Wall Street consensus Friday, fueled by robust growth in net interest income, loan and deposit growth as well as higher interest rates.

“Our fee businesses continued to benefit from good underlying consumer and business conditions,” said U.S. Bancorp President and CEO Andy Cecere. “Credit quality remains strong and in the third quarter our net charge-off ratio improved on both a sequential and year over year basis.”

Q3 adjusted EPS of $1.18 (excluding M&A integration charges of $0.02) exceeded the average analyst estimate of $1.16 and compared with $0.99 in Q2 and $1.30 in Q3 a year ago.

Total net revenue of $6.33B surpassed the consensus of $6.20B and rose from $6.01B in Q2 and $5.89B in Q3 2021.

Q2 net interest income on taxable equivalent basis of $3.86B gained from $3.5B in the prior quarter but fell from $4.2B in the year-ago period. As such, net interest margin of 2.83% vs. 2.59% in Q2 and 2.53% in Q3 of last year.

Noninterest income decreased to $2.47B from $2.55B in Q1 and $2.7B in Q3 2021.

Average total loans of $336.78B climbed 3.9% from Q2; average total deposits of $456.77B ticked up 0.1%.

Provision for credit losses was $362M in Q3 vs. $311M in Q2 and a benefit of $163M in Q3 2021.

Earlier, U.S. Bancorp Non-GAAP EPS of $1.18 beats by $0.02, revenue of $6.33B beats by $130M.