U.S. Bancorp CEO Richard Davis said Wednesday that he sees loan demand coming back in the second half of 2014 because bank customers are much more willing to discuss future investments than they have been in years.

“My intuition tells me we’re on the verge and the advent of an increasing sentiment for consumer spending, but I think we’ll see it in the second half of the year,” Davis told analysts after the company reported its last results for 2013. “I think it may be a tale of two halves of the year.”

Davis said his reading is based simply on sentiment and reports from his bankers, and that he doesn’t have evidence of the turn yet.

More corporate customers are taking out lines of credit from U.S. Bank, for instance, yet they still aren’t rushing to draw on the money. The bank’s utilization rate on credit lines remains historically low.

The Minneapolis-based lender, fighting to offset a steep decline in mortgage banking activity, grew profits 2.5 percent in the fourth quarter to $1.46 billion, or 76 cents a share. The results beat the Wall Street consensus expectation by a penny.

Gains in business and commercial real estate lending, credit and debit card revenue, as well as trust and investment management fees and commercial products such as bond underwriting drove profit growth, along with an extra $35 million that came from dipping into the reserves held for future credit losses.

Revenue of $4.89 billion, however, was flat from the previous quarter and 4 percent lower than a year ago.

For the full year, U.S. Bank had profits of $5.8 billion, up 3.3 percent from 2012.

Investors knocked the stock immediately after the bank released earnings, but U.S. Bank shares quickly bounced back and were down 14 cents at $41.44, off about a half-percent, at the end of the day.

“Nothing stood out necessarily as overly positive because they’re still subject to some of the same challenges being posted by the macro environment … loan growth is modest, interest rate levels remain low,” said Shannon Stemm, a bank analyst at Edward Jones.

Stemm said she has a hold rating on the stock because she expects only modest earnings growth until the bank can grow revenue. Known for its highly efficient operations, U.S. Bank simply doesn’t have much fat to trim to boost earnings and is already pulling all its levers, she said.

In the conference call with analysts, Davis addressed the security issues that have embroiled retailers since Target Corp.’s huge data breach late last year. He described it as a “burden on the banks” and said U.S. Bank is deep in the conversion to EMV, the chip-based payment technology set to replace magnetic stripes on payment cards.

In an interview, U.S. Bank Chief Financial Officer Andy Cecere said U.S. Bank has now decided to replace all debit and credit cards for customers who could be affected by shopping at Target during the breach period, which is about 1.2 million cards.

“We wanted to make our customers secure over the long term,” Cecere said.

The bank has already replaced a majority of the cards, he said, and expects to be done in a “month or so.”

He stressed that the switch to EMV is a step in the right direction but not the final answer to security, and that the bank is working with other banks, retail partners and the Clearing House, a bank trade association focused on the payments system, to find a better fraud solution.

“It’s likely we will go from magnetic stripes to chip, but ultimately there will be another solution and the question is how far down the road that comes,” Cecere said. “There are a lot of potential solutions here.”