Wells Fargo securities showed growth on Wednesday, January 15, after the bank released information about its earnings for the fourth quarter of 2024, which exceeded preliminary expectations, and issued strong guidance on net interest income for 2025.
The revenue of the mentioned financial institution, headquartered in San Francisco, for the three-month period ended December 31 was recorded at the $20.38 billion mark. It is worth noting that the preliminary forecast of LSEG provided that this figure would amount to $20.59 billion. In the last quarter of 2023, the financial institution’s revenue was recorded at the $20.47 billion mark.
The bank’s net income for the fourth quarter of 2024 amounted to $5.1 billion. This indicator increased by 47% year-on-year. Adjusted earnings per share amounted to $1.58. LSEG’s preliminary forecast envisaged that this figure would be $1.35 per equity.
The financial institution expects that in 2025 its interest income will be 1-3% higher than the 2024 figure which amounted to $47.7 billion. It is worth noting that this indicator is the main measure of what a bank makes on loans.
The value of Wells Fargo shares showed growth on Wednesday. This indicator rose by more than 5%.
Charlie Scharf, chief executive officer of the financial institution, said that the solid performance for the fourth quarter of 2024 caps a year of significant progress for the bank he leads. It was also noted that the lender’s earnings profile continues to improve. According to Charlie Scharf, the financial institution sees benefits from investments that are being made to increase Wells Fargo’s growth and improve customer and community service. He also stated that the bank maintained a strong balance sheet, returned about $25 billion of capital to shareholders, and made significant progress in its risk and control work.
Wells Fargo’s investment banking fees in the fourth quarter of 2024 were recorded at the $725 million mark. This indicator showed an increase of 59% compared to reading for the same period in 2023.
Last year, the financial institution repurchased 57.8 million shares worth $4 billion.
In 2024, the value of the financial institution’s shares increased by almost 43%. Since the beginning of the current month, this indicator has grown by 6%.
Under the leadership of Charlie Scharf, Wells Fargo has undertaken a multi-year effort to address compliance problems. In 2016, the financial institution was at the center of a scandal that broke out due to fake accounts. Two years later, the Fed imposed a $1.95 trillion asset cap on Wells Fargo. This measure does not allow a financial institution to grow until regulators decide that the bank fixed failings in its governance and risk management.
Charlie Scharf stated that last year the asset cap was curtailing the lender’s ability to take in more deposits and expand its trading business.
In November, the media published information that the financial institution is in the last stage of the process of passing regulatory tests to lift the asset cap, which may happen as early as the first half of 2025. On Wednesday, Charlie Scharf stated that he is confident that the bank will successfully complete the work required in its content orders and compliance mindset into its culture.
As we have reported earlier, BNY Quarterly Profit Beats Estimates.
