Wells Fargo beat sales and profit targets in the first quarter of the year, a period that saw the collapse of two banks that rattled the financial sector and the broader stock market
ByMATT OTT AP Business Writer
Wells Fargo beat sales and profit targets in the first quarter compared with a year earlier, boosted by higher interest rates.
The quarter saw the collapse of two banks that rattled the financial sector and the broader stock market. Wells Fargo participated with other banks in pumping $30 billion in deposits into First Republic Bank in a so far successful effort to prevent a third failure.
Wells earned $5 billion, or $1.23 per share, in the three months ended March 31, beating analyst projections by 10 cents a share. Revenue of $20.7 billion topped Wall Street's target of $20.1 billion.
Revenue and profit also came in well ahead of last year's first quarter, when the San Francisco-based bank posted net earnings of $3.8 billion, or 91 cents per share, on revenue of $17.7 billion.
Wells, which until recently was the U.S.'s biggest mortgage lender, set aside $643 million for potential loan losses, specifically commercial real estate loans, credit cards and auto loans.
Wells is still trying to exit the strict federal guidelines imposed in 2018 that sets its asset cap at just under $2 billion after a series of scandals, including the uncovering of millions of fake checking accounts its employees opened to meet sales quotas. That order was expected to last only a year or two, but additional improprities have surfaced and regulators have been skeptical about the bank’s efforts to clean up its act.
Shares of Wells Fargo rose 3% in premarket trading.
