Wells Fargo’s profits were up for the second quarter. The bank is reporting net income of $5.73 billion. WFAE’s Duncan McFadyen reports the company is trying to diversify in order to make up for a decline in its mortgage business.
Wells Fargo is the country’s largest mortgage lender. The bank has capitalized on the rebound in the housing market, posting growth in revenue and income in consecutive quarters for three years. But, as interest rates have climbed up, the mortgage business has slowed down, and the streak ended this quarter.
Earnings per share fell four cents, to $1.01 per share; down four cents a share from the first quarter. But compared with a year ago, it’s up 3 cents. Revenue fell 1.5 percent from last year to $21.1 billion.
CEO John Stumpf says Wells Fargo’s expansion of other businesses, including credit cards, auto loans, and investment banking, helped make up the difference.
“While the economic recovery remains uneven, there are many indicators that economic growth is accelerating, and we remain optimistic about the opportunities the recovery provides for Wells Fargo and for our customers,” he said Friday on a conference call with investors.
Analysts had predicted the drop. The bank met Wall Street expectations for earnings per share and beat estimates for revenue.
Wells Fargo stock closed down 32 cents Friday, at $51.49.