By Senad Karaahmetovic
Wells Fargo (NYSE:WFC) delivered a solid beat to see its shares trade modestly higher in pre-open Friday.
The bank delivered Q3 EPS of $1.30 on revenue of $19.51 billion, which is ahead of the Street consensus of $1.10 on sales of $18.75 billion. Net interest income (NII) came in at $12.10 billion, ahead of the $11.64 billion estimate. Return on tangible common equity was 9.6%, lower than the estimate of 12.2%
“We have been focused on increasing our earnings capacity and see the positive impacts of rising interest rates driving strong net interest income growth and our continued focus on improving operating efficiencies resulting in lower expenses excluding the operating losses above,” Chief Executive Officer Charlie Scharf said in a press release.
“Credit performance remains strong and we are continuing to invest in our technology platforms, digital platforms and an expanded product set.”
Revenue was boosted by a 42% jump in the Commercial banking unit, which topped the average analyst consensus by $300 million. Corporate and investment banking revenue rose 20% to $4.06 billion, again easily ahead of the consensus. Wealth & investment management also saw its revenue top the average analyst consensus.
The bank also noted that the Q3 results were impacted by $2 billion, or $0.45 per share, in operating losses related to litigation, customer remediation, and regulatory matters