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U.S. Bancorp (NYSE:USB) turned in stronger-than-expected Q2 earnings on Wednesday as net interest income improved from the prior quarter and deposits grew and lending activity increased.
The bank reaffirmed its 2024 net interest income guidance at $16.1B-$16.4B vs. the Visible Alpha consensus of $16.2B. It also still expects adjusted noninterest expense of $16.8B or less.
The company expects Q3 net interest income to be relatively stable to $4.05B in Q2 2024. Visible Alpha consensus of $4.07B.
Q2 adjusted EPS of $0.98, topping the average analyst estimate of $0.95, rose from $0.90 in Q1 and declined from $1.12 in Q2 2023.
“This quarter we generated $6.9B in net revenue driven by improved linked quarter net interest income, supported by healthy deposit growth, and continued momentum in leveraging our diversified fee income platform to deepen relationships,” said Chairman and CEO Andy Cecere.
U.S. Bancorp (USB) stock rose 1.2% in Wednesday premarket trading.
Provision for credit losses of $568M rose from $553M in the previous quarter and declined from $821M a year ago. Net charge-off ratio, excluding notable items, increased to 0.58% from 0.53% in Q1 and 0.35% in Q2 2023.
Net interest income on a taxable equivalent basis of $4.05B, beating the Visible Alpha estimate of $3.99B, increased from $4.02B in the prior quarter and dropped from $4.45B a year ago. Net interest margin (taxable equivalent) of 2.67% slipped from 2.70% in Q1 and 2.90% in Q2 2023.
Adjusted noninterest income of $2.82B rose from $2.70B in the previous quarter and $2.73B in the year-ago period.
Average deposits increased to $513.9B from $503.1B in the prior quarter. Average total loans grew to $374.7B from $371.1B in the prior quarter.
Conference call at 8:00 AM ET.
Earlier, U.S. Bancorp GAAP EPS of $0.97 beats by $0.02, revenue of $6.87B beats by $70M
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