NYSE$USB

US Bancorp · Q1 2023 earnings

Q1 2023 earnings · · Investor relations

Briefing

Reported a strong first quarter performance driven by revenue growth and the acquisition of MUFG Union Bank.

U.S. Bancorp reported a net income of $1.698 billion and diluted earnings per common share of $1.04 for Q1 2023. The results reflect the impact of the MUFG Union Bank acquisition and rising interest rates on earning assets.

  • Net income attributable to U.S. Bancorp was $1,698 million.
  • Diluted earnings per common share were $1.04.
  • Net revenue of $7,175 million including $4,668 million of net interest income and $2,507 million of noninterest income.
  • Net interest margin of 3.10%.

Headline financials

Total Revenue

$7.14B

Previous: $5.57B+28.2%
EPS (adj)

$1.16

Previous: $0.99+17.2%
Net Interest Margin

3.1%

Previous: 2.4%+27.0%
Return on Avg Assets

1.0%

Previous: 1.1%-5.5%
Return on Common Equity

14.1%

Previous: 12.7%+11.0%
Efficiency Ratio

63.2%

Previous: 62.8%+0.6%
Return on Tangible Equity

22.0%

No prior period
Net Charge-Off Ratio

0.4%

Previous: 0.2%+85.7%
Free Cash Flow

$1.7B

Previous: $1.56B+9.1%
Net Income

$1.7B

Previous: $1.56B+9.1%
Operating Income

$3.24B

Previous: $2.15B+50.8%
Gross Profit

$6.71B

Previous: $5.46B+23.0%
Cash & Equivalents

$68.2B

Previous: $44.3B+54.0%
Total Assets

$682B

Previous: $587B+16.3%

Revenue & EPS history

US Bancorp · Revenue · Quarterly

$7.14B

Q1 2023+28.2%vs Q1 2022
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Revenue by segment

US Bancorp · $5.99B total across 4 segments · Q1 2023

  • Consumer & Business
    $2.71B+37.1%
  • Payment Services
    $1.59B+7.3%
  • Corporate & Commercial
    $1.39B+41.8%
  • Treasury & Corporate
    $297M+3.1%

Forward guidance

U.S. Bancorp expects the CET1 ratio to expand over the next several quarters as they realize the accretive benefit of the recently-acquired Union Bank. The integration is proceeding as planned, and they continue to target conversion over the upcoming Memorial Day weekend.

Tailwinds

  • MUB transition progressing as planned and we remain on track for conversion over Memorial Day weekend
  • Tangible common equity accretion of 7.5% in 1Q23
  • Robust liquidity profile highlighted by total available liquidity of $315 billion and a year-end 2022 Liquidity Coverage Ratio (LCR) of 122%
  • High quality deposit base with insured deposits accounting for 51% of total deposits. Of the uninsured deposits, approximately 80% are retail customers or operational in nature.
  • Deposit balances were relatively stable from March 8, 2023, to the end of the quarter

Headwinds

  • Deterioration in general business and economic conditions or turbulence in domestic or global financial markets, which could adversely affect U.S. Bancorp’s revenues and the values of its assets and liabilities, reduce the availability of funding to certain financial institutions, lead to a tightening of credit, and increase stock price volatility
  • Turmoil and volatility in the financial services industry, including failures or rumors of failures of other depository institutions, which could affect the ability of depository institutions, including U.S. Bank National Association and MUFG Union Bank, N.A., to attract and retain depositors, and could affect the ability of financial services providers, including U.S. Bancorp, to borrow or raise capital
  • Changes to regulatory capital, liquidity and resolution-related requirements applicable to large banking organizations in response to recent developments affecting the banking sector
  • Changes in interest rates
  • Increases in unemployment rates

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2023

Historical avgQ1 2023

+0.0%

Avg return

Earnings day

+0.3%

Avg return

5 days after

+2.2%

Avg return

30 days after

54%

39 / 72 earnings

Positive

+7.1%

Q2 2023

Best reaction

-11.2%

Q1 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.0%+0.8%-5.8%
Q3 2025-1.8%+2.5%+1.4%
Q2 2025+0.5%-0.9%+5.4%
Q1 2025-2.1%-2.1%+16.3%
Q4 2024-5.0%-3.1%-6.2%
Q3 2024+6.3%+2.0%+6.2%
Q2 2024+2.6%+4.0%-0.2%
Q1 2024-3.8%+0.1%+1.0%
Q4 2023-3.0%+1.0%+0.3%
Q3 2023-6.1%-10.4%+7.9%
Q2 2023+7.1%+7.4%+0.8%
Q1 2023-1.2%-6.8%-14.4%
Q4 2022+4.3%+4.6%+2.1%
Q3 2022+3.1%-0.3%+8.6%
Q2 2022+5.5%+6.3%+10.2%
Q1 2022+4.2%+4.5%-4.0%
Q4 2021-8.4%-8.7%-8.2%
Q3 2021-2.0%-0.2%-1.6%
Q2 2021+0.3%-1.6%+2.2%
Q1 2021+0.5%-2.4%+7.5%
Q4 2020-5.0%-4.8%+4.1%
Q3 2020+1.9%+1.4%+12.7%
Q2 2020+3.5%-2.0%+4.1%
Q1 2020-11.2%-4.3%-14.3%
Q4 2019-2.5%-2.2%-2.6%
Q3 2019+1.8%+4.5%+9.9%
Q2 2019+4.1%+4.3%-1.4%
Q1 2019+1.8%+1.8%+2.5%
Q4 2018+3.7%+4.7%+7.0%
Q3 2018+2.3%+0.9%+7.7%
Q2 2018+0.1%+1.1%+3.9%
Q1 2018-0.6%-0.9%-0.9%
Q4 2017-1.8%+0.2%-2.7%
Q3 2017-0.5%+0.5%-3.7%
Q2 2017+1.6%+2.2%+0.1%
Q1 2017+1.8%+3.5%+2.6%
Q4 2016+0.8%+1.3%+9.1%
Q3 2016+2.2%+2.3%+14.5%
Q2 2016+1.5%+1.7%+3.6%
Q1 2016+1.6%
Q4 2015-2.0%
Q3 2015+0.7%
Q2 2015+4.5%
Q1 2015-1.4%
Q4 2014+5.4%
Q3 2014+0.3%
Q2 2014-3.9%
Q1 2014-1.9%
Q4 2013-2.1%
Q3 2013+2.2%
Q2 2013-0.5%
Q1 2013-2.8%
Q4 2012-1.6%
Q3 2012+2.4%
Q2 2012+2.6%
Q1 2012+0.4%
Q4 2011-0.3%
Q3 2011+1.1%
Q2 2011-1.5%
Q1 2011+0.0%
Q4 2009-1.5%
Q4 2008-1.5%
Q4 2010-1.5%
Q2 2010-1.5%
Q3 2010-3.4%
Q1 2009+4.2%
Q1 2010+1.5%
Q4 2007+0.9%
Q3 2009+2.2%
Q3 2008+2.2%
Q2 2008-4.9%
Q2 2009-4.9%

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