U.S. Bancorp's Buying Spree Pays Off

MINNEAPOLIS (TheStreet -- U.S. Bancorp(USB Quote)'s steady pace of acquisitions throughout the financial crisis reverberated in the Midwest institution's better-than-expected third quarter results on Wednesday.

The bank, which has $265 billion in assets and operates the sixth largest commercial bank in the United States, topped Wall Street expectations as revenue rose 26% year-over-year to $4.25 billion. The stock was gaining more than 6% in recent trades to $25.23.

Earnings totaled $603 million, or 30 cents a share, in the three months ended Sept. 30, up from a year-ago equivalent profit of $576 million, or 32 cents a share, and its second-quarter earnings of $471 million, or 12 cents a share. The latest results were ahead of the average estimate of analysts polled by Thomson Reuters was for earnings of 27 cents a share in the September period.

While much of the non-interest revenue growth at U.S. Bancorp was organic, particularly from strong mortgage loan volume and commercial products, the bank's recent acquisitions are starting to add up. The company is clearly positioning itself for growth as opposed to Citigroup (C Quote), which is divesting many assets, even profitable ones such as energy trading unit Phibro, as it works to claw its way out of the precarious position it's found itself in as a result of the financial crisis.

U.S. Bancorp's average loan growth rose 9.3% over the year-earlier quarter. Excluding acquisitions, loan growth rose 2.6%, the bank said. Deposit growth surged 24.6% with strong average noninterest bearing deposits and total savings deposit growth. Without the acquisitions, growth was 16.1%.