Wells Fargo earnings rise as credit quality improves
New York (AFP) - Wells Fargo Friday reported higher earnings on better credit quality as increases in industrial and commercial loans offset declines in many home-lending categories.
Wells Fargo, the nation's largest mortgage lender, said first-quarter earnings were $5.6 billion, up 14 percent on the year-ago quarter.
"Our solid first-quarter results again demonstrated the ability of our diversified business model to perform for shareholders," chief executive John Stumpf said in a statement.
"First-quarter 2014 earnings were another record for our company and capital levels continued to strengthen."
The San Francisco-based lender continued to notch better results due to improving credit quality. Credit losses were $825 million in the January-March quarter, compared with $1.4 billion a year ago.
The improvement comes as more consumers pay bills on time and the bank's stash of nonperforming assets diminishes.
Total loans at Wells Fargo stood at $826.4 billion, up $4.2 billion from the prior year. Improving categories included commercial and industrial and commercial real estate.
But Wells Fargo reported mortgage originations worth $36 million, down $67 million from the year-ago level. The company also had fewer mortgage applications and a smaller application pipeline.
The results translated into $1.05 per share, better than the 97 cents forecast by Wall Street analysts. Revenues slipped from $21.26 billion to $20.63 billion. Analysts had forecast revenues of $20.6 billion.
Shares of Wells Fargo rose 0.3 percent to $47.83 in pre-market trading.
