By Jeff McKinney
The Cincinnati Enquirer
Loan growth, expense control and strong asset quality helped the parent of Fifth Third Bank post a 15 percent gain in third-quarter profits.

Cincinnati-based Fifth Third Bancorp on Tuesday said it earned $416.5 million, or 70 cents a share, up from $363.5 million, or 62 cents a share, during last year's third quarter.

Excluding last year's merger-related charge tied to Fifth Third's $5.5 billion purchase of Michigan's Old Kent Financial Corp., Fifth Third earned $416.5 million, or 70 cents a share, up from $279.4 million, or 47 cents a share.

Fifth Third chief executive George A. Schaefer Jr. said the bank's higher profits came as it expanded customer relationships in consumer and business banking, and experienced strong loan growth and continued strength in all lines of business.

The growth came as Fifth Third increased net interest income to $677.6 million, up 11.2 percent from $607.9 million a year ago. The bank's fee income also jumped to $607.6 million, up 30.5 percent from $465.3 million, in last year third quarter.

On the expense side, as it previously announced, Fifth Third took a $53 million after-tax charge to cover losses on treasury-related securities.

Mr. Schaefer said the bank foresees no other major charges or problems in that area going forward. He said the bank also is reviewing those investments to identify any problems and see whether any lost investments are recoverable.

In another report:

U.S. Bancorp: Higher fee income and gains from the sales of investments helped the parent of U.S Bank post record third-quarter profits.

The Minneapolis-based bank had operating earnings of $906.2 million, or 47 cents a share, compared with $149.7 million, or 8 cents a share, a year ago. The bank beat Wall Street's consensus share earnings estimates of 46 cents for this quarter.

Including merger-related charges tied to its recent deal with Firstar Corp. and restructuring charges, U.S. Bancorp had net income of $860.3 million, or 45 cents a share.

The higher profits came as the bank's fee income rose to $1.56 billion, up from $1.32 billion during last year's third quarter, fueled by gains in credit-card processing, mortgage banking deposit fees and consumer banking.

Also during the quarter, U.S. Bancorp completed its systems integration process tied to its $22 billion merger with Firstar.

E-mail jmckinney@enquirer.com