US Bancorp Profit Falls 21%, Hurt by Charges
U.S. Bancorp, the sixth-largest U.S. bank, said on Tuesday fourth-quarter profit fell 21 percent, hurt by losses from loans and money market mutual funds, and a legal settlement.
Net income was $942 million, or 53 cents per share, down from $1.19 billion, or 66 cents, a year earlier.
U.S. Bancorp said results included 13 cents per share of charges. These included costs for the bank's share of Visa's$2.1 billion antitrust settlement with American Express, and a loss tied to financial market liquidity problems that led the bank to repurchase asset-backed commercial paper held in money market mutual funds run by its FAF Advisors unit.
Revenue rose 3 percent to $3.54 billion, while expenses rose 20 percent to $1.93 billion.
Analysts on average had forecast profit of 59 cents per share on revenue of $3.51 billion, according to Reuters Estimates. It wasn't immediately clear on what basis the average earnings estimate was computed.
Chief Executive Richard Davis in a statement said net charge-offs and nonperforming assets rose in the quarter. He said U.S. Bancorp "will not be immune to the current stress in the residential real estate markets and mortgage-related industries," but that credit quality remained sound."
Minneapolis-based U.S. Bancorp operates 2,518 branches in 24 states, largely in the western two-thirds of the country. It ended the quarter with $238 billion of assets.
Shares of U.S. Bancorp closed Monday at $30.32 on the New York Stock Exchange. The shares have fallen 15 percent in the last year, compared with a 28 percent drop in the Philadelphia KBW Bank Index.