A Wells Fargo customer uses the ATM at a branch in San Bruno, California, on Aug. 8, 2023.
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Wells Fargo on Friday surpassed Wall Street expectations for third-quarter earnings and revenue because the profit from higher rates of interest offset slowing lending activity.
Shares of the bank rose 3.1% following the report.
Wells Fargo posted earnings per share of $1.48 within the quarter, or $1.39 excluding discrete tax advantages. It was unclear what the precise comparable number was to Wall Street’s expectations, but each figures are higher than the LSEG consensus EPS of $1.24. The earnings are also significantly higher than the 86 cents per share earned in the identical quarter a yr ago.
Total revenue got here to $20.9 billion throughout the quarter, beating the consensus estimate of $20.1 billion, based on LSEG, formerly generally known as Refinitiv. Revenue was 6.5% higher than the $19.6 billion recorded within the third quarter of 2022.
“Our revenue growth from a yr ago included each higher net interest income and noninterest income as we benefited from higher rates and the investments we’re making in our businesses,” Wells CEO Charlie Scharf said in an announcement.
“While the economy has continued to be resilient, we’re seeing the impact of the slowing economy with loan balances declining and charge-offs continuing to deteriorate modestly,” Scharf added.
Net income rose to $5.77 billion within the three months ended Sept. 30 from $3.59 billion a yr earlier, driven by an 8% increase in net interest income.
Wells Fargo said provision for credit losses within the quarter included a $333 million increase within the allowance for credit losses for industrial real estate office loans and better bank card loan balances.