The Banking and Strategy Initiative

Chillin' out till it needs to be funded

Wells Fargo makes another Dollar for the stores~! :: Bank Earnings Season 1Q2015

Well the release is still awaited but the sneak preview says Wells Fargo made it past a $1.04 in earnings on par with December which definitely counts for an herculean effort from the bank which was second only to US Bank in the December quarter in growth in loans, only creditable because lending is actually negative at Bank of America and Citi and Wells Fargo has been trying its hands at originations in Auto and new accounts in Card lines for the first time in 2013, was up 10% and 16% in both as it expounded at the Credit Suisse forum to a net bag of $860 bln in 2014 (EOY)

Net Income is though much better than expected, still down only 0.1 from the $5.9 bln it posted in 1Q2014 and efficiency as the bank forewarned has made it back to 59% from under 58% last year quarter. Linked quarter figures are not inspiring either as you can see in our archives of December ( we hardly wrote anything else inbetween)

Average Loans have JP Morgan caught up at 863 Bln moving hardly from 862 Bln in 2014 but average deposits are up higher meaning more cash locked up for the bank in the period and the EPS chip resulting from the 7,4 mln shares sold down by the bank in the 201 buyback. Their dividend compares at 37.5 cents approved after CCAR with $0.44 cents approved for JP Morgan and ROA remains best in class at 1.4% undeterrred by size, ROE at 13.2%

Revenue ticked down marginally to $21.3 Bln for the quarter, 11 Bln from NII for the lesser number of days in the quarter and NIMs ( not comparable with the JPM calculation) down 0.1% to 2.95%

Both Gain on Sales ( income from mortgages sold down) and originations improved in the linked quarter with Originations up to $49 Bln again  and GoS a mighty 2.06% . Op expenses are down from the high in Q4 but still high as the efficiency ratios remain near 59% and the bank expects no respite this year. Consumer losses on loans were down to 0.60% the bank getting back control on Credit quality and we wil be unable to sit thru their conference as we switch off after the call at JP Morgan


This entry was posted on April 14, 2015 by in Uncategorized.


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