Wells Fargo Q2 Net Income Declines, Net Interest Income Down 9%

(RTTNews) - Wells Fargo (WFC) reported second quarter net income of $4.91 billion compared to $4.94 billion, last year. Earnings per common share was $1.33 compared to $1.25. On average, 20 analysts polled by Thomson Reuters expected the company to report profit per share of $1.29, for the quarter. Analysts' estimates typically exclude special items.

Second quarter revenue was $20.7 billion, up 1% from a year ago. Analysts on average had estimated $20.29 billion in revenue.

Net interest income decreased 9% year-over-year to $11.9 billion, due to the impact of higher interest rates on funding costs, including the impact of lower deposit balances and customer migration to higher yielding deposit products in Consumer Banking and Lending and Wealth and Investment Management, higher deposit costs in Commercial Banking and Corporate and Investment Banking, as well as lower loan balances, partially offset by higher yields on earning assets. Noninterest income increased 19% to $8.8 billion.

CEO Charlie Scharf said: "Our efforts to transform Wells Fargo were reflected in our second quarter financial performance as diluted earnings per common share grew from both the first quarter and a year ago. We continued to see growth in our fee-based revenue offsetting an expected decline in net interest income."

For fiscal 2024, the company still expects net interest income to be in the range of down approximately 7-9% from 2023 level. The company currently expects it to be in the upper half of the range, or down approximately 8-9%.

Shares of Wells Fargo are down 5% in pre-market trade on Friday.

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