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Wells Fargo Reports In Line Q2 Results

Wells Fargo & Co. WFC reported a 2 percent drop in profit for the second quarter despite 4 percent growth in revenue. However, both earnings and revenue were in line with the Street analysts' expectations. The stock ticked about 1 percent lower in pre-market trading.

The company said it earned $5.6 billion or $1.03 a share for the second quarter compared to $5.7 billion or $1.03 a share in the year-ago quarter. Analysts too expected the same EPS.

Wells Fargo's top line advanced 4 percent to $22.2 billion from $21.3 billion in the previous year quarter. Street estimated the bank to generate $22.17 billion revenue. While net interest income increased $66 million to $11.7 billion from first quarter 2016, Noninterest income slipped to $10.4 billion from $10.5 billion in first quarter 2016.

The company's Chairman and CEO, John Stumpf, said, "Wells Fargo's second quarter results demonstrated our ability to generate consistent performance during periods of economic, capital markets and interest rate uncertainty. Compared with a year ago, we had solid growth in loans, deposits and customers, which are our fundamental drivers of long-term value. We also improved our efficiency ratio while continuing to reinvest in the franchise. We returned more capital to our shareholders in the quarter and were pleased to have received a non-objection to our 2016 Capital Plan from the Federal Reserve. We remain well positioned to continue to meet the financial needs of our customers."

Wells Fargo's total average loans increased 9 percent or $80.3 billion to $950.8 billion, while total average deposits grew four percent or $51.4 billion to $1.2 trillion. The company claimed solid overall credit quality.

The company's equity topped $200 billion mark for the first time. The bank boosted its quarterly dividend to $0.38 a share under its comprehensive capital analysis and review.

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