Daily News: April 14, 2017

Wells Fargo Q1 Global C&I Portfolio Reflects Growth, Higher Returns

Wells Fargo reported Q1/17 net income of $5.46 billion on revenue of $22.0 billion, in line with $5.46 billion and $22.2 billion in Q1/16.

The bank noted Q1/17 global C&I average loan balances of $330.1 billion were up 7.44% from $307.2 billion a year earlier. Interest income of $2,809 million was up from $2,435 million in Q1/16. Q1/17 yields of 3.59% and 2.73% on U.S. and non U.S. C&I loans, respectively were up from 3.39% and 2.10% a year earlier. Non-U.S. based C&I loans represented about 17% ($55.3 billion) of the total C&I loan portfolio in Q1/17, up 16% a year earlier.

The following highlights were excerpted from the news release:

  • The Q1/17 provision for loan losses of $605 million was down 44% from $1,086 million in Q1/16.
  • Credit Quality: Chief Risk Officer Mike Loughlin said, “First quarter credit results reflected strong performance in our commercial portfolios and consumer real estate portfolios. Improvement in the oil and gas portfolio, as well as continued improvement in residential real estate, drove a $200 million reserve release in the quarter.”
  • CEO Tim Sloan said, “Wells Fargo continued to make meaningful progress in the first quarter in rebuilding trust with customers and other important stakeholders, while producing solid financial results. We had taken significant actions throughout the company to date and we are committed to building a better bank as we move was more Wells Fargo forward. Earlier this week, the independent directors of Wells Fargo’s board of directors issued a report on their investigation into the company’s retail banking sales practices. The findings are valuable to us and beneficial in helping to identify areas for further improvement. While we have more work to done, I am pleases with all we have accomplished thus far. Our 273,000 team members have remained committed to helping our customers succeed financially, as reflected in improved retail customer service scores, record levels of deposits, more primary consumer checking customers, record client assets in Wealth and Investment Management, and industry leading mortgage originations.”