Wells Fargo beats Wall Street targets for Q1, earning $5 billion
Wells Fargo exceeded year-over-year sales and earnings targets in the first quarter, helped by higher interest rates.
The quarter saw the collapse of two banks that shook the financial sector and the broader stock market. Wells Fargo joined other banks in pumping $30 billion in deposits into First Republic Bank in a so far successful attempt to avert a third collapse.
Wells earned $5 billion, or $1.23 per share, for the three months ended March 31, beating analysts’ forecasts by 10 cents per share. Revenue of $20.7 billion surpassed Wall Street’s target of $20.1 billion.
Revenue and earnings were also well above last year’s first quarter, when the San Francisco-based bank reported net income of $3.8 billion, or 91 cents a share, on revenue of $17.7 billion.
Wells, until recently the largest US mortgage lender, has set aside $643 million for potential loan losses, particularly on commercial real estate, credit card and auto loans.
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Wells is still trying to get out of strict federal guidelines imposed in 2018 that capped his wealth at just under $2 billion after a series of scandals including uncovering millions of fake checking accounts his employees opened to meet sales quotas. That order was only supposed to last a year or two, but other shortcomings have surfaced and regulators have been skeptical of the bank’s efforts to clean up its actions.
Wells Fargo shares are up 3% in premarket trading.
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