No recommendation
No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.
(Sharecast News) - US lender Wells Fargo posted higher thirdquarter profits on Tuesday, as loan growth and firmer interest income continued to support performance, but revenues disappointed.
Wells Fargo reported net income of $5.95bn, or $1.87 a share, up from $5.59bn or $1.66 a year earlier. However, revenues of $21.87bn missed consensus estimates of $22.31bn.
Net interest income rose 5% to $12.52bn, helped by the removal of the Fed's longstanding asset cap, which has allowed Wells to deploy more of its balance sheet and compete more aggressively for lending.
Growth in creditcard and auto loans underpinned a solid consumer book, reflecting stillresilient spending trends. Average loans grew 11% year-on-year to $1.03trn, while average deposits rose 11% to $1.48trn.
The bank's provision for credit losses rose to $1.03bn, up from $681m a year earlier, reflecting higher allowances tied to growth in commercial, industrial and auto lending. Net chargeoffs increased to $983m, equivalent to 0.38% of average total loans on an annualised basis.
Wells Fargo also said underlying customer behaviour remained healthy despite mixed sentiment, with chief executive Charlie Scharf noting that both consumer and business clients were "doing well".
As of 1320 BST, Wells Fargo shares were down 1.39% in pre-market action at $82.16 each.
Reporting by Iain Gilbert at Sharecast.com
The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website is not personal advice based on your circumstances. So you can make informed decisions for yourself we aim to provide you with the best information, best service and best prices. If you are unsure about the suitability of an investment please contact us for advice.