Wells Fargo Earned $1.01 for Q2

Wells Fargo reported Q2 earnings this morning of $1.01 per share which matched expectations. Unfortunately, this report snapped WFC’s streak of quarterly earnings increases at 17.

Net income for the second quarter advanced to $5.73 billion, or $1.01 a share, from $5.52 billion, or 98 cents, a year earlier, the San Francisco-based lender said today in a statement. The average estimate of 31 analysts surveyed by Bloomberg was $1.01 a share excluding special items. Earnings per share fell from $1.05 in the three months ended March 31.

Chief Executive Officer John Stumpf, 60, has sought to counter a drop in mortgage revenue as higher interest rates crimp new home loans. He’s expanded in businesses including credit-card and auto lending, investment banking and retail wealth management to help cover the shortfall.

“Our strong results in the second quarter reflected the benefit of our diversified business model,” Stumpf said in the statement. “Our results also reflected strong credit quality driven by an improved economy, especially the housing market.”

The lender set aside $217 million to cover bad loans, or 67 percent less than a year earlier, according to the statement. Wells Fargo released $500 million in loan-loss reserves, matching the estimate of Sanford C. Bernstein & Co.’s John McDonald.

The stock is down this morning, but not by much. WFC’s revenue slid to $21.1 billion but topped expectations. Mortgage revenue fell 39%. The bank seems to be managing itself well during a critical turn for the industry.

Posted by on July 11th, 2014 at 10:01 am


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