Wells Fargo reported Q2/18 net income of $5.2 billion, compared with $5.9 billion in Q2/17. Q2/18 included a net discrete income tax expense of $481 million mostly related to state income taxes driven by the recent U.S. Supreme Court decision in South Dakota v. Wayfair. Revenue of $21.6 billion was down from $22.2 billion a year earlier.
The U.S. C&I loan average balance of $273.7 billion for the six month period compared to $273.9 billion a year earlier. The average yield of 4.00% was up 35 bps from 3.65% in 2017. Interest income of $5.4 billion was up from $5 billion a year earlier.
The non-U.S. C&I average balance of $60 billion for the first six months of 2018 was up 7.3% from $55.9 billion for the same period in 2017. The average yield of 3.37% compared to 2.80% for the same six months in 2017. Interest income for the period of $1 billion was up 29% from $775 million a year earlier.
Wells Fargo CEO Tim Sloan said, “During the second quarter we continued to transform Wells Fargo into a better, stronger company for our customers, team members, communities and shareholders. Our progress included making further improvements to our compliance and operational risk management programs; hiring a new chief risk officer; announcing innovative new products including a digital application for Merchant Services customers and our enhanced Propel Card; launching our ‘Re-established’ marketing effort, the largest advertising campaign in our history; announcing a new $200 billion commitment to financing sustainable businesses and projects and continuing to move forward on our expense savings initiatives. I’m also pleased with our recent CCAR results, which demonstrates the strength of our diversified business model, our sound financial risk management practices and our strong capital position and enables us to return more capital to our shareholders in alignment with our goal of creating long-term shareholder value.”
