After the beating S&P gave BBT a few days ago, we need some help. Interesting increase in top line revenue for WFC. I have no clue whether BB&T comes up with anything like that. Note $ from Wealth Management. This is a strength for BB&T. I don't know how it compares with WFC wealth management in terms of size but I know BB&T WM is very highly regarded. WFC has not taken the % beating BBT has in terms of % drop from high to low. That could mean the market had a better handle on WFC's strength. Or we could have a skyrocket day tomorrow with a good report.
NEW YORK (AP) -- Wells Fargo gave anxious investors a pleasant surprise Wednesday, reporting a profit drop that was milder than anticipated and lifting its quarterly dividend by 10 percent. Wells Fargo's second-quarter profit fell 22 percent as more customers at the nation's fifth-largest bank failed to pay back their loans. But it raised its dividend to 34 cents from 31 cents -- at a time when many other financial institutions are slashing theirs to preserve capital.
Shares rose nearly 12 percent to $22.90 in premarket trading Wednesday, after tumbling alongside other financial stocks over the last several days on worries about more U.S. mortgage losses and bank failures. The San Francisco-based company's stock is down about 42 percent over the past year.
Wells Fargo & Co. earned $1.75 billion, or 53 cents per share, in the April to June period, down from $2.28 billion, or 67 cents per share, in the same timeframe last year. Analysts polled by Thomson Financial had predicted, on average, a profit of 50 cents per share on revenue of $10.65 billion.
Wells Fargo has now logged three straight quarters of profit declines. But the bank has been weathering one of the nation's worst credit crises much better than most of its peers, in part because it had less exposure to the subprime mortgages whose failured undermined the financial sector.
The bank took a provision for credit losses of $3 billion. That provision included total charge-offs of $1.5 billion, and an increase in reserves for future losses of $1.5 billion. Wells Fargo's total allowance for credit losses now stands at $7.52 billion, up from $6.01 billion at the end of the first quarter.
But revenue soared 16 percent to a record $11.5 billion, on strength in the bank's deposits, mortgage banking, credit card, and wealth management businesses.
"We were able to lend more to current customers where we believed it was prudent and properly priced," said President and Chief Executive John Stumpf in a statement. He added that the company gained more business and customers through acquisitions.
The mortgage lending climate remains tough, but Wells Fargo managed to keep total retail mortgage originations at $31 billion, the same as last year, despite tightening its pricing and underwriting standards.