U.S. Bank tech spend up 12% to $513M

U.S. Bank made digital and operational investments during the fourth quarter as it focused on modernizing payments and technology. The $668 billion, Minneapolis, Minn. bank spent $513 million on technology and communication during Q4, up 12% year over year, according to its Q4 2023 earnings presentation. [caption id="attachment_57365455" align="alignright" width="300"] Courtesy/Bloomberg [/caption] U.S. Bank is investing in its merchant processing capabilities, Chief Executive Andy Cecere said during today’s Q4 earnings call. “No. 1 is our tech-led initiative, which is now up over 30% of our activities related to tech-led [spend], so that is integrating our merchant processing capabilities into the software that people use to run their businesses.” BIGGER PICTURE: The bank’s tech investments are ongoing; it announced third-quarter digitalization efforts to expand its network without growing its physical footprint, Chief Financial Officer John Stern said in November at the BancAnalyst Association of Boston Conference . Stern said the bank plans to expand into Arizona, Florida, Georgia, North Carolina, New York, Texas and Tennessee. As the bank works to expands outreach, its branch network dropped 9% YoY to 2,274 branches, according to its earnings supplement. BY THE NUMBERS: U.S. Bank reported in Q4: Efficiency ratio of 75.9%, up from 63.3% during the same period in 2022; Noninterest expense of $5.2 billion, up 29% YoY; and Noninterest income up 28% YoY to $2.6 billion. NOTEWORTHY: U.S. Bank’s integration of Union Bank continued during Q4 as merger and integration costs totaled $171 million during the period, according to the earnings presentation. Cost efficiencies from the integration are still expected to total $900 million by yearend 2024, Cecere said during the earnings call. FUTURE LOOK: The bank has identified more opportunities for efficiencies within personnel and operations when it comes to implementing technology, Cecere said. Further investments in technology “will allow us to more efficiently deliver the services we have,” he said. [stock_market_widget type="inline" template="generic" assets="USB" markup="{name} ({symbol}) is trading at {price} ({change_pct}) as of {last_update}" api="yf"]. Get ready for the Bank Automation Summit U.S. 2024 in Nashville on March 18-19! Discover the latest advancements in AI and automation in banking. Register now.

U.S. Bank tech spend up 12% to $513M

Bank makes digital, operational investments

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U.S. Bank tech spend up 12% to $513M

Bank makes digital, operational investments

Q4 transactions: Ally, Microsoft team up on gen AI

Citizens to deliver on AI, data analytics in 2024

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