U.S. Bancorp reported Q1/16 net income of $1.39 billion compared with $1.43 billion in the first quarter of 2015. The bank noted the decrease in net income year-over-year was partially due to a 25% ($66 million) increase in loan loss provisions driven by energy-related commercial loans. The bank said reserves for energy-related commercial loans were 9.1% of outstanding balances at March 31, 2016, compared with 5.4% at December 31, 2015.
The following highlights were excerpted from the news release:
U.S. Bancorp Chairman and CEO Richard K. Davis said, “U.S. Bancorp is off to a solid start in 2016 as we once again delivered industry-leading performance metrics against a backdrop of global concerns driving long-term interest rates lower and continuing pressure in the energy sector. We continued to produce strong loan and deposit growth which combined with a stable net interest margin, resulted in growth in net interest income. Our payments-related businesses remain strong and we continue to invest in those businesses, as demonstrated by the acquisition of the $1.6 billion retail card portfolio at the end of 2015. Although the pressures from the energy industry negatively impacted the quarter, we took appropriate measures and remain confident that we are well positioned to continue delivering industry-leading returns throughout the year.”
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