Daily News: January 11, 2013

Wells Fargo Reports Record Q4, FY Earnings

Wells Fargo reported fourth quarter and full year 2012 net income was a record $5.1 billion and $18.9 billion, respectively up 24% and 19% compared to the same year-ago periods. Revenues for the fourth quarter and full year were $21.9 billion and $86.1 billion, respectively up from 7% and 6% from the same 2011 periods.

Commenting on credit quality, chief risk officer Mike Loughlin said, “Credit losses were $9.0 billion in 2012, compared with $11.3 billion in 2011 – an improvement of $2.3 billion or 20%.” Loughlin added, “Reflecting on continued, improve credit performance, we released $250 million in loan loss reserves in the fourth quarter. Absent significant deterioration in the economy, we continue to expect future reserve releases in 2013, though at a lower level than in 2012.”

“2012 was an outstanding year for Wells Fargo,” said chairman and CEO John Stumpf. “We saw the continued benefits of our diversified business model and reported record full year and fourth quarter earnings, robust deposit and solid loan growth, and strong performance across our business units. The Company’s success is due to our more than 265,000 team members who remained focused on our customers and on our vision to satisfy all of our customers’ financial needs.

“This time last year, I said we would benefit from the many opportunities we saw for 2012 – and we did just that. From growing revenue, making strategic acquisitions and achieving efficiency improvements, I am extremely pleased with our 2012 performance. We also returned more capital to our shareholders through common stock dividends and common stock repurchases. We are very well positioned for and look forward to 2013, as Wells Fargo continues to work hard to contribute to a growing U.S. economy by doing what we do best: helping customers succeed financially.”

Chief financial officer Tim Sloan added, “The company’s underlying results were driven by solid loan growth, improved credit quality, and continued success in improving efficiency. While our fourth quarter included some noteworthy items, we achieved strong returns on average assets and equity of 1.46 percent and 13.35 percent, respectively. We are very pleased with the company’s outstanding performance despite the challenges our industry faced during this past year, including continued low interest rates and elevated unemployment. Our balanced business model helped us deliver strong results throughout these challenging times and should provide us the opportunity to continue to deliver value to our shareholders in the coming year.”

To read the full release, click here.