Wells Fargo (WFC) drops as NII trails analyst estimates

April 12, 2024 6:53 AM EDT

Wells Fargo (NYSE: WFC) reported first-quarter revenue that surpassed the average analyst estimate.

However, WFC stock fell about 2.5% in pre-open trade after the company reported softer-than-expected net interest income (NII) numbers.

Total revenue amounted to $20.86 billion, exceeding the Bloomberg Consensus estimate of $20.18 billion. Earnings per share (EPS) stood at $1.20, easily ahead of the expected $1.07.

Commercial banking revenue came in at $3.15 billion, slightly below the estimate of $3.35 billion. Meanwhile, corporate and investment banking revenue performed well, generating $4.98 billion, surpassing the estimate of $4.85 billion.

In the wealth & investment management segment, total revenue reached $3.74 billion, in line with expectations. Consumer banking and lending total revenue reached $9.09 billion, below the estimate of $9.41 billion.

However, net interest income was reported at $12.23 billion, slightly below the estimate of $12.32 billion.

The efficiency ratio was reported at 69%, slightly above the estimate of 68%. The net interest margin was reported at 2.81%.

Total average deposits amounted to $1.34 trillion, also in line with expectations. The common equity Tier 1 ratio was reported at 11.2% while non-interest expenses totaled $14.34 billion, above the estimate of $13.91 billion.

Return on tangible common equity exceeded expectations, reaching 12.3%, compared to the estimate of 10.9%.

By Senad Karaahmetovic

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