Wells Fargo Reports $6.2 Billion in Net Income in Q2/2019



Wells Fargo reported its preliminary financial results for the second quarter of 2019, including a net income of $6.2 billion, an 8% increase year over year from Q2/2018.

Other financial highlights from the quarter included:

  • Diluted earnings per share (EPS) of $1.30, compared with $0.98 in Q2/2018
  • Revenue of $21.6 billion
  • Net interest income of $12.1 billion, down $446 million
  • Noninterest income of $9.5 billion, up $477 million
  • Noninterest expense of $13.4 billion, down $533 million
  • Average deposits of $1.3 trillion, down $2.4 billion
  • Average loans of $947.5 billion, up $3.4 billion
  • Return on assets (ROA) of 1.31%, return on equity (ROE) of 13.26%, and return on average tangible common equity (ROTCE) of 15.78%1
  • Provision expense of $503 million, up $51 million from second quarter 2018
  • Net charge-offs of $653 million, up $51 million
  • Net charge-offs of 0.28% of average loans (annualized), up from 0.26%
  • Reserve release2 of $150 million, equal to the amount released in second quarter 2018
  • Nonaccrual loans of $5.9 billion, down $1.2 billion, or 17%
  • Strong capital position while returning more capital to shareholders:
  • Returned $6.1 billion to shareholders through common stock dividends and net share repurchases, up 52% from $4.0 billion in second quarter 2018
  • Common equity Tier 1 ratio (fully phased-in) of 12.0%3, which continued to exceed both the regulatory minimum of 9% and our current internal target of 10%
  • Received a non-objection to the company’s 2019 Capital Plan submission from the Federal Reserve

As part of the capital plan, the company expects to increase its third quarter 2019 common stock dividend to $0.51 per share from $0.45 per share, subject to approval by the company’s board of directors. The plan also includes up to $23.1 billion of gross common stock repurchases, subject to management discretion, for the four-quarter period from third quarter 2019 through second quarter 2020.

Interim CEO Allen Parker commented, “In second quarter 2019, we recorded strong earnings and continued to make progress on our top priorities: focusing on our customers and team members; meeting the expectations of our regulators; and continuing the important transformation of our company. During the second quarter, we formed a new Strategic Execution and Operations Office that will focus on achieving operational excellence across our businesses to enable us to execute more effectively on our regulatory priorities and further drive our transformation. Finally, our recent CCAR results demonstrated the strength of our diversified business model, our strong capital position, our sound financial risk management, and our commitment to return excess capital to our shareholders in a prudent manner.”

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