U.S. Bancorp Earnings: Slight Drop in Revenue Outlook, but Capital Build Should Remain on Track

Wide-moat-rated U.S. Bancorp reported what we see as average results. The bank’s deposit base and funding costs are tracking roughly as would have been expected even before the Silicon Valley Bank implosion, although the bank’s through-the-cycle deposit beta estimate of 40% is just above what we were previously projecting (39%). A sequential deposit decline of 4% and a shift into interest-bearing deposits, which now account for 75% of the deposit base, still fit well within our previous expectations of a 5% drop for the year and interest-bearing deposits growing to 77% of deposits.