By Everdeen Mason
Fifth Third Bancorp (FITB) said its profit climbed slightly in
the fourth quarter on improved credit quality and smaller loan-loss
provisions, masking a decline in revenue.
The Cincinnati-based lender said it earned $402 million, up from
$399 million a year earlier. Per-share earnings, which reflect the
payment of preferred dividends, were flat at 43 cents. The current
quarter included $69 million in charges related to an increase in
litigation reserves, a $91 million benefit from the sale of its
shares in payment processor Vantiv Inc. (VNTV) and other items.
Revenue, a combination of noninterest income and net interest
income, dropped 9.8% to $1.61 billion.
Analysts polled by Thomson recently expected per-share earnings
of 42 cents on revenue of $1.53 billion.
Like other regional banks, Fifth Third saw a plunge in
mortgage-banking revenue as rising mortgage rates stymied loan
refinancing activity by borrowers. Mortgage-banking revenue dropped
51% to $126 million from
year earlier.
The company recorded a smaller provision for loan losses, off
30% to
a$53 million from a year earlier. The move came as its net
charge-off rate, which measures loans deemed uncollectible, slipped
to 0.67% from 0.7% a year earlier.
The bank's net interest margin, which measures the spread
between what lenders make from lending and investing and what they
pay depositors, fell to 3.21% from 3.49% a year earlier and 3.31%
in the previous quarter.
Fifth Third shares closed at $21.92 Wednesday and were inactive
premarket. The stock is up 34% in the past 12 months.
Write to Everdeen Mason at everdeen.mason@wsj.com
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