Wells Fargo said Friday that second-quarter profit declined 48% from a year earlier as the bank set aside funds for bad loans and was stung by declines in its equity holdings.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
Earnings per share: 82 cents adjusted vs 80 cents expectedRevenue: $17.03 billion vs $17.53 billion expected
Profit of $3.12 billion, or 74 cents per share, fell sharply compared with $6.04 billion, or $1.38, a year earlier, the bank said in a statement. Shares of the company dropped nearly 1% in premarket trading.
Excluding the impairment, the bank would have earned 82 cents per share in the quarter, edging out the 80 cents per share estimate from analysts surveyed by Refinitiv.
“While our net income declined in the second quarter, our underlying results reflected our improving earnings capacity with expenses declining and rising interest rates driving strong net interest income growth,” CEO Charlie Scharf said in the release.
Analysts and investors have been closely poring over bank results for any signs of stress on the U.S. economy. While borrowers of all types have continued to repay their loans, the possibility of a looming recession triggered by surging interest rates and broad declines in asset values has begun to appear in results.