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(Reuters) -Capital One Financial reported a rise in second-quarter adjusted profit on Tuesday, as the consumer lender was helped by a boost in interest income on its credit card debt and higher fee income. Shares of the company, which have gained nearly 22% in 2025, rose 2.5% after the bell. Consumer spending displayed underlying resilience in the April to June quarter, as many consumers curtailed discretionary spending amid inflationary pressures fueled by uncertainties over U.S. President Trump’s trade policies, while maintaining steady outlays on essential goods and services. However, companies such as Capital One (NYSE:COF) are shielded from economic volatility and ensuing industry weakness because of their credit card business. Interest rates on credit card debt are significantly higher than those on mortgages and other kinds of loans. Capital One became the biggest U.S. credit card issuer by balances after its acquisition of Discover Financial was completed midway through the second quarter, following more than a year of regulatory to-and-fro. The McLean, Virginia-based company’s net interest income — the difference between what it makes on loans and pays out on deposits — rose 32.5% to $10 billion in the quarter. Capital One’s quarterly non-interest income, which primarily consists of interchange income, net of reward expenses, service charges and other customer-related fees, rose nearly 27% to $2.50 billion. However, as consumers pull back on discretionary spending due to high borrowing costs, companies have resorted to building a bigger buffer to help shield themselves from potential loan defaults. The company’s loan loss provisions stood at $11.43 billion in the second quarter, compared to $3.91 billion a year earlier. Net charge-offs, or debts that are unlikely to be recovered, jumped 16% to $3.06 billion in the period, the company said. Capital One’s adjusted net income available to common stockholders was $2.77 billion, or $5.48 per share, in the three months ended June 30, from $1.21 billion, or $3.14 per share, a year earlier.

(Reuters) -Regional lender Huntington Bancshares (NASDAQ:HBAN) on Friday raised its annual interest income forecast, betting on robust loan growth and lower deposit costs. The Columbus (WA:CLC), Ohio-based Huntington has delivered strong growth in its core businesses and expanded to North and South Carolinas and Texas in recent years, despite high interest rates squeezing loan demand for regional banks. Rate cuts by the U.S. Federal Reserve last year have also allowed banks to reduce deposit costs. The bank now expects net interest income (NII) - the difference between what it earns on loans and pays out on deposits - to grow between 8% and 9% in 2025, compared with its prior forecast of 5% and 7% rise. Annual loan growth is expected between 6% and 8%, higher than its prior forecast of 5% to 7% rise. NII jumped 12% to $1.47 billion in the second quarter, putting the bank on track for a record full-year interest income. Average total loans and leases grew $9.8 billion from the year-ago quarter. Huntington’s profit per share rose to 34 cents in the quarter ending June 30, from 30 cents a year earlier. On Monday, Huntington struck a $1.9 billion deal for rival Veritex (NASDAQ:VBTX), furthering its Texas push. BOND PORTFOLIO REJIG Months after a similar move, Huntington rejigged a portion of its securities portfolio to boost profits, as banks increasingly dump lower-yielding securities. Huntington sold $900 million of corporate bonds in the quarter and reinvested proceeds into higher-yielding securities, resulting in a pre-tax loss of $58 million. The rejig is expected to boost revenue and interest margin in the second half of the year and into 2026, with Huntington picking up about 340 basis points of yield on the trade.

(Reuters) -BNY’s profit jumped in the second quarter, the Wall Street bank reported on Tuesday, driven by higher interest income and fee revenue growth, as client portfolios swelled due to a recovery in the equity market. A late-quarter rally driven by hopes of trade deals and possible rate cuts lifted major U.S. indexes and improved sentiment. Shifting U.S. tariff policies and mounting geopolitical tensions had whipsawed the markets earlier in the quarter. BNY’s assets under custody and administration rose 13% in the quarter ended June 30 to $55.8 trillion from a year earlier. The world’s largest custodian bank said the increase reflected higher market values, client inflows and the favorable impact of the weaker U.S. dollar. Its total revenue climbed 9% and exceeded $5 billion for the first time in a quarter. Net interest income (NII) - the spread between earnings from assets and costs on liabilities - also rose 17%. Analysts on average had forecast growth of 11.8%, according to estimates compiled by LSEG. Profit applicable to BNY shareholders came in at $1.39 billion, or $1.93 per share, compared with $1.14 billion, or $1.52 per share, a year earlier. Assets under management rose 3% over the same period. SECURITIES SERVICES SHINES The bank’s asset servicing business, which handles the safekeeping and settlement of trades, posted a 7% rise in revenue. Meanwhile, its issuer services segment, which supports clients issuing securities, reported a 17% increase. Total fee revenue rose 7% to $3.64 billion, compared with the year-ago quarter. "BNY’s ongoing transformation has significant momentum," CEO Robin Vince said in a statement. "Only one year after the launch of our new commercial model last summer, we delivered two consecutive quarters of record sales in the first half of the year." Custodian banks play a critical role in global markets by safeguarding trillions of dollars in client assets, handling the settlement of trades, and ensuring a smooth transfer of securities and cash between financial institutions. Last month, the Wall Street Journal reported that BNY had approached smaller rival Northern Trust (NASDAQ:NTRS) about a potential merger. Chicago-based Northern Trust later said it remained fully committed to staying independent. But analysts have said a tie-up between BNY and Northern Trust is unlikely, citing doubts over Northern Trust’s interest in selling and the regulatory hurdles in a merger of two globally significant banks. They added that BNY could instead pursue a different target. With NTRS making headlines, savvy investors are asking: Is it truly valued fairly? In a market full of overpriced darlings, identifying true value can be challenging. InvestingPro's advanced AI algorithms have analyzed NTRS alongside thousands of other stocks to uncover hidden gems. These undervalued stocks, potentially including NTRS, could offer substantial returns as the market corrects. In 2024 alone, our AI identified several undervalued stocks that later surged by 30 or more. Is NTRS poised for similar growth? Don't miss the opportunity to find out.