U.S. Bancorp, the parent company of U.S. Bank, has reported net income of $1.52bn for the second quarter of 2016, an increase of 2.6% compared with $1.48bn in the year ago quarter.

For the period ended 30 June 2016, the bank’s total net revenue rose 8.2% to $5.45bn from $5.04bn in the second quarter of 2015.

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Net interest income on a taxable-equivalent basis in the second quarter of 2016 was $2.89bn, an increase of $126 million (4.5%) over the second quarter of 2015. The increase was driven by loan growth and higher rates, partially offset by the loan portfolio mix, the lender said.

The net interest margin in the second quarter of 2016 was 3.02%, compared with 3.03% in the second quarter of 2015, and 3.06 percent in the first quarter of 2016.

Expenses rose 11.6% to $2.99bn on higher variable compensation expense, increased compliance costs and higher marketing expense due to "brand investment.

The bank’s provision for credit losses for the second quarter of 2016 was $327m, which was $46m or 16.4% higher than the second quarter of 2015.

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U.S. Bancorp chairman and CEO Richard Davis said, “The second quarter was a record quarter for us as we once again delivered industry-leading returns, steady loan growth and strength in our fee-based businesses. Steady loan growth, demonstrated by continued strength in commercial loans and momentum in consumer loans, led to increased net interest income despite a decline in net interest margin. Growth in our fee revenue continued across many of our fee-based businesses, including our payments business lines.”