Wells Fargo beats by $0.14, beats on revs (56.69)
- Reports Q1 (Mar) earnings of $1.20 per share, $0.14 better than the FactSet Consensus of $1.06; revenues rose 0.6% year/year to $20.86 bln vs the $20.19 bln FactSet Consensus.
- Net interest income decreased 8%, due to the impact of higher interest rates on funding costs, including the impact of customer migration to higher yielding deposit products, as well as lower loan balances, partially offset by higher yields on earning assets
- NIM of 2.81% vs 2.92% in Q4
- Noninterest income increased 17%, driven primarily by improved results in our affiliated venture capital business on lower impairments, higher investment banking fees, an increase in asset-based fees in Wealth and Investment Management on higher market valuations, and higher trading revenue in our Markets business
- Noninterest expense increased 5%, driven by higher operating losses reflecting customer remediation accruals for historical matters, higher FDIC assessments, an increase in revenue-related compensation predominantly in Wealth and Investment Management, and higher technology and equipment expense, partially offset by the impact of efficiency initiatives including lower professional and outside services expense
- Provision for credit losses in first quarter 2024 included a decrease in the allowance for credit losses driven by commercial real estate and auto loans, partially offset by a higher allowance for credit card loans
- Outlook
- 2024 NII expected to be ~7-9% lower than 2023 level of $52.4 bln (unchanged)
- 2024 noninterest expense expected to be ~52.6 bln (unchanged)