Wells Fargo (WFC) Misses Q3 EPS by 3c, Revenue Beats
Wells Fargo (NYSE: WFC) reported Q3 EPS of $0.42, $0.03 worse than the analyst estimate of $0.45. Revenue for the quarter came in at $18.9 billion versus the consensus estimate of $17.97 billion.
Financial results1:
◦Third quarter 2020 pre-tax results were impacted by the following:
▪$961 million of customer remediation accruals
▪$718 million of restructuring charges, predominantly severance expense
▪$452 million of noninterest income related to nonmarketable equity securities
◦Revenue of $18.9 billion, down from $22.0 billion
▪Net interest income of $9.4 billion, down $2.3 billion
▪Noninterest income of $9.5 billion, down $891 million
◦Noninterest expense of $15.2 billion, up $30 million
◦Average loans of $931.7 billion, down $18.1 billion, or 2%
◦Average deposits of $1.4 trillion, up $107.7 billion, or 8%
•Credit quality1:
◦Provision expense of $769 million, up $74 million
▪Total net charge-offs of $731 million, up $86 million
•Net loan charge-offs of 0.29% of average loans (annualized), up from 0.27%
▪Allowance for credit losses for loans of $20.5 billion, flat compared with second quarter 2020
◦Nonaccrual loans of $8.0 billion, up $2.5 billion, or 45%
•Liquidity and capital positions:
◦Liquidity coverage ratio2 (LCR) of 134%, which continued to exceed the regulatory minimum of 100%
◦Common Equity Tier 1 (CET1) ratio of 11.4%3, up from 11.0% in second quarter 2020; the CET1 ratio continued to exceed both the regulatory minimum of 9% and our current internal target of 10%
For earnings history and earnings-related data on Wells Fargo (WFC) click here.