Wells fargo misses first quarter earnings estimates by a wide margin

Wells fargo misses first quarter earnings estimates by a wide margin

Wajeeh is a reporter for Invezz, covering the European, Asian and North American stock markets. Wajeeh has 5 years of experience… Read more.

Wells Fargo & Co (NYSE:WFC) said Tuesday it earned one percent of earnings per share in the first quarter. Anticipating that the ongoing coronavirus pandemic will fuel loan losses, the bank also said it has set aside about 3.2 billion pounds.

The health crisis has driven companies into temporary plant closures and put about 10 million people out of work so far. In the aftermath, banks had anticipated massive revenue losses as both businesses and individuals struggle to pay bills on time.

CEO Charlie Scharf says the U.S. Multinational financial services company has already offered a £23.95 million fee waiver and deferred £2.24 billion in payments.

Wells Fargo suspends its 2020 loan revenue forecast

For loan loss provisions, the bank added, it has set aside about 3.06 billion pounds, which is significantly higher than 675 million pounds last year.

Bank executives also highlighted that Wells Fargo has temporarily halted its cost-cutting programs due to the COVID-19 situation. Wells Fargo also suspended its 2020 loan revenue forecast.

At 770.55 billion pounds, total loans were recorded 2% higher, driven by an increase in business loans that outpaced declines in consumer credit card balances and some mortgage loans that were refinanced.

Wells Fargo's statement on Tuesday also highlighted that both its commercial and retail banking businesses saw a 6% increase in deposits in the first quarter.

Bank's lending activity led to 8% lower revenue in first quarter. At £9.02 billion, this revenue was not adjusted for the impact of loan loss provisions. Card fees and lower mortgages also led to a massive 31% drop in fee income, which totaled £5.11 billion in the first quarter, according to Wells Fargo.

Wells Fargo was supposed to be in the 1. Earn 33 cents of earnings per share in the third quarter

At £33.54 million (1 penny per share), the bank's total income was well below the £4.40 billion recorded in the same quarter last year. Refinitiv says analysts had estimated bank's earnings at 33 cents per share in latest quarter.

At the time of writing, Wells Fargo is exchanging hands for £24.15 per share on the stock market, down around 45% in 2020. Performance in 2019, on the other hand, was moderately positive, with an annual increase of more than 15%.

Wells Fargo currently has a market capitalization of 98.68 billion pounds and a price-to-earnings ratio of 7.45.

  • Wells Fargo earned 1 cent of earnings per share in the first quarter, down from an expected 33 cents.
  • U.S. Multinational bank suspends its 2020 lending forecast.
  • Wells Fargo posts 8% drop in loan revenue in first quarter.

Wells Fargo & Co (NYSE:WFC) said Tuesday it earned one percent in first-quarter earnings per share. Anticipating that the ongoing coronavirus pandemic will fuel loan losses, the bank also said it had set aside about 3.2 billion pounds.

The health care crisis has pushed companies into temporary plant closures and put about 10 million people out of work so far. Subsequently, banks had expected a massive drop in earnings as both corporate and retail customers struggle to pay bills on time.

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CEO Charlie Scharf says the U.S. Multinational financial services company has already offered a fee waiver of 23.95 million pounds and deferred payments of 2.24 billion pounds.

Wells Fargo suspends its 2020 loan revenue forecast

For loan loss provisions, the bank added, it has set aside about 3.06 billion pounds, which is significantly higher than 675 million pounds last year.

Bank executives also highlighted that Wells Fargo has temporarily halted its cost-cutting programs due to the COVID-19 situation. Wells Fargo also suspended its 2020 loan revenue forecast.

At 770.55 billion pounds, total loans were recorded 2% higher, driven by an increase in business loans that outpaced declines in consumer credit card balances and some mortgage loans that were refinanced.

Wells Fargo's statement on Tuesday also highlighted that both its commercial and retail banking businesses saw a 6% increase in deposits in the first quarter.

The bank's lending activities resulted in 8% lower revenues in the first quarter. At £9.02 billion, this revenue was not adjusted for the impact of loan loss provisions. Card fees and lower mortgages also led to a massive 31% drop in fee income, which totaled £5.11 billion in the first quarter, according to Wells Fargo.

Wells Fargo was expected to be listed in the 1. Earn 33 cents of earnings per share in the third quarter

At 33.54 million pounds (1 penny per share), the bank's total revenue was well below the 4.40 billion pounds recorded in the year-ago quarter. According to Refinitiv, analysts had estimated the bank's earnings at 33 cents per share in the latest quarter.

At the time of writing, Wells Fargo is exchanging hands for £24.15 per share on the stock market, down about 45% in 2020. Performance in 2019, on the other hand, was moderately positive, with an annual increase of more than 15%.

Wells Fargo currently has a market capitalization of 98.68 billion pounds and a price-to-earnings ratio of 7.45.

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