U.S. Bancorp (USB, Financial) came out strong in Q3 2024, posting a solid net income of $1.71 billion—up 12.5% from the same quarter last year. Diluted earnings per share climbed to $1.03, compared to $0.91 in Q3 2023. The boost in profitability was driven by a 2.8% increase in net interest income, hitting $4.17 billion. This gain was powered by higher interest rates on earning assets and tight control over liabilities. While the quarter saw $119 million in securities losses, that was mostly neutralized by lower tax expenses thanks to some favorable tax settlements.
Despite a slight 2.4% dip in noninterest income, mainly due to lower service charges and securities losses, U.S. Bancorp still posted growth in key areas. Commercial products revenue jumped 12.1%, and trust and investment management fees rose 6.4%. On the expense side, noninterest costs dropped 7.2% year-over-year as notable items from last year were off the books. Compensation and employee benefits ticked up by 0.8%, but overall, the company kept a tight lid on costs.
Capital remains a strong suit for U.S. Bancorp, with the Common Equity Tier 1 (CET1) ratio rising to 10.5%, up from 9.7% a year ago. The company's disciplined expense management paired with capital growth efforts signals that U.S. Bancorp is in a strong position to resume share repurchases soon, a move that reflects confidence in its long-term financial health and commitment to returning value to shareholders.
