July 20, 2023 | Premium Service | U.S. Bancorp (USB) had a decent quarter in Q2 2023, but one that is still obscured by the accounting for the Union Bank purchase from Mitsubishi UFJ Financial Group, Inc. (MUFG). The Q2 numbers in terms of returns were down from Q1, but the analyst community took comfort from the fact that the capital levels rose.
In terms of USB, we need to see the efficiency for the combined entity down in the mid-50s before we are ready to declare success. That said, Buy Side manager are already buying USB on the assumption that management will ultimate return to trend earnings. The table below shows key performance indicators for USB from the Q2 2023 earnings presentation.