U.S. Bancorp, the fifth-biggest U.S. bank, posted a 63 percent increase in second-quarter profit as income from lending and fee-generating businesses grew after the purchase of failed lenders.
Net income advanced to $766 million, or 45 cents a share, from $471 million, or 12 cents, in the same period a year earlier, Minneapolis-based U.S. Bancorp said today in a statement. Twenty-seven analysts surveyed by Bloomberg had an average profit estimate of 38 cents a share. Profit in the year- earlier period included a $123 million accrual for a special assessment to the Federal Deposit Insurance Corp.
Chief Executive Officer Richard Davis,52, has overseen the lender’s U.S.-assisted purchases of failed banks and thrifts, with more than 200 offices and assets topping $35 billion over the past two years. U.S. Bancorp’s return on assets and return on equity have outpaced nine other large U.S. banks since Jan. 1, 2008, according to a May investor presentation.
“Their FDIC-assisted acquisitions have been a nice strategy because there is favorable accounting and they bought them early in the cycle,” Anton Schutz, president of Mendon Capital Advisors in Rochester, New York, said yesterday. His firm owned 100,000 US Bancorp shares as of March 31.