Wells Fargo (WFC) Q2 Earnings Report

Wells Fargo & Co (NYSE:WFC) history dates back to 1852 when Henry Wells and William Fargo established the company to provide banking and express delivery services. Back then, Wells Fargo used to buy and sell gold, besides offering rapid delivery of valuable items. Over the years, the company earned the trust and good reputation that helped it to become one of the most valuable financial companies in the United States.

The San Francisco-based bank recently announced its financial results for the second quarter above expectations. Wells Fargo reported earnings of $1.38 per share for the three months ended June 30, versus a loss of $1.01 per share in the same period last year. Analysts, on average, were expecting Wells Fargo to report earnings of 98 cents per share. Net interest income fell 11 percent to $8.8 billion, primarily due to lower interest rates.

Revenue came in at $20.270 billion, up from $18.286 billion in the year-ago quarter and above the consensus forecast of $8.847 billion. Revenue from the consumer banking and lending segment jumped 14 percent on a year-over-year basis. Comparatively, commercial banking revenue decreased 10 percent, while corporate and investment banking revenue plummeted 18 percent.

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Commenting on the quarter, CEO Charlie Scharf said in a statement, “Wells Fargo benefited from the continued economic recovery, strong markets that helped drive gains in our affiliated venture capital businesses, and our progress on improving efficiency, but the headwinds of low interest rates and tepid loan demand remained. Credit quality continued to be exceptionally strong. Our results included a $1.6 billion pre-tax reduction in the allowance for credit losses, and charge-offs continued to decline. While we expect charge-offs will increase at some point, we continue to see strong trends in all of our businesses.”

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