Catenaa, Friday, April 11, 2025- Wells Fargo posted revenue below Wall Street’s expectation for the first quarter on Friday as with higher deposit costs and slow growth in personal loans.
The San-Francisco based banker reported revenue of $20.15 billion versus the expectation of $20.75 billion, first quarter revenue was down by 2% year on year.
Adjusted earnings per share stood at $1.39, 16% higher year on year but not quite comparable to the estimate of $1.24 due to a number of special items during the quarter.
Net interest income, a key measure of what a bank makes on loans, fell 6% year over year to $11.50 billion. Non-interest income, which includes investment banking fees, brokerage commissions and advisory fees, rose 1% to $8.65 billion from last year’s $8.54 billion.
Consumer, Small and Business Banking was down 2% driven by higher deposit costs, reflecting the impact of customer migration to higher yielding deposit products, partially offset by higher deposit balances, while personal lending was down 10% driven by lower loan balance.
CEO Charlie Scharf said diluted earnings per share increasing 16% from a year ago reflects fee-based revenue growth across many of its core businesses, continued expense discipline, improved credit results, and an 8% reduction in diluted common shares as the bank continued to return capital to shareholders.
“We support the administration’s willingness to look at barriers to fair trade for the United States, though there are certainly risks associated with such significant actions,” Scharf said in a statement.
“Timely resolution which benefits the US would be good for businesses, consumers, and the markets. We expect continued volatility and uncertainty and are prepared for a slower economic environment in 2025, but the actual outcome will be dependent on the results and timing of the policy changes.” he said.
