Wells Fargo's quarterly profit rises 16 percent as cost cuts pay off
REUTERS: Wells Fargo & Co reported a 16.4 percent jump in quarterly profit on Friday, as the lender reaped the benefits of its aggressive cost-cutting efforts.
Noninterest expenses fell 7.5 percent to US$13.9 billion in the first quarter from a year earlier. The bank said it was on track to meet its 2019 expense target of US$52 billion to US$53 billion.
Wells Fargo, the fourth-largest U.S. bank by assets, has been leaning on cost cuts to grow its profits in the aftermath of a wide-ranging sales scandal that has crimped revenue, hurt its reputation and resulted in a regulatory growth restriction on its balance sheet.
Some of the bank’s business fundamentals remained challenged even more than two years after the scandal.
Total revenue fell 1.5 percent in the quarter to US$21.61 billion.
Loans rose marginally to US$948.25 billion, with growth in commercial loans cushioning a 2 percent decline in loans made at its consumer unit, the area most closely tied to the sales scandal.
Net income applicable to common stock rose to US$5.51 billion, or US$1.20 per share, in the first quarter ended March 31, from US$4.73 billion, or 96 cents per share, a year earlier. https://reut.rs/2P8a214
Analysts had expected a profit of US$1.09 per share, according to IBES data from Refinitiv, but it was not immediately clear if the numbers were comparable.
(Reporting By Aparajita Saxena and Imani Moise; Editing by Sriraj Kalluvila)